Stringent action by the State have reduced the smuggling of watches, gold, alcohol and currency to a considerable extent, but there’s a lot that still needs to be done, said R. Sakkarapani, Minister for Food and Civil Supplies.
Addressing a seminar on ‘Preventive Strategies to Combat Counterfeiting and Smuggling’, organised by FICCI CASCADE (Committee Against Smuggling and Counterfeiting Activities Destroying the Economy), the Minister said that in Tamil Nadu, rice is being provided free of cost under the Public Distribution System which has benefited the poor and as a result of this the State has been leading in education and economic development. “Some don’t understand this and are smuggling rice causing loss to the government and public,” he pointed out, adding that the Tamil Nadu government is taking various measures to prevent it. The Minister also told the FICCI CASCADE team to highlight the problem of counterfeiting and smuggling on social media channels, newspapers and other promotional sources in order to create public awareness on the issue.
During a panel discussion, Mahesh Kumar Aggarwal, Additional Director General of Police, Crime, pointed out that during the COVID-19 pandemic there have been instances of counterfeiting of pharmaceutical products (especially face masks). He also gave details on how the Tamil Nadu government re-christened video piracy cell to IP Right Enforcement Cell and the cases booked for violations. Mr. Aggarwal also highlighted the initiatives taken by the State government in the last few months to eradicate the drug menace.
G.S.K. Velu, Chairman, FICCI Tamil Nadu State Council, and CMD, Trivitron/Neuberg Group of Companies, said that in the past ten years the magnitude of illicit trade has grown from $650 billion to about $3 trillion, representing 10% of the global trade and being rightly been termed as the crime of the 21st century by the FBI. He added that the total quantum of smuggling is increasing which could be due to tax arbitrage or global demand. “Consumers must be emphasized on taking a bill on every purchase for making India a tax complaint nation and encouraging citizens to be a part of progressive nation building,” Mr.Velu said.
According to the details provided by FICCI, the government suffers tax loss of ₹58,521 crore due to illicit trade in five key Indian industries. Products which cause maximum revenue loss to the exchequer are FMCG-packaged foods (₹17,074 crore), alcoholic beverages (₹15,262 crore) and tobacco products (₹13,331 crore). Illicit market in 5 industries, including mobile phones, FMCG-household and personal goods, FMCG-packaged foods, tobacco products, and alcoholic beverages, is valued at ₹2,60,094 crore
P.C. Jha, Advisor, FICCI CASCADE, and former Chairman, Central Board of Indirect Taxes & Customs, said, “Illicit trade is a grave concern, it undermines the nation’s economy, damages brand integrity, and most importantly affects health and safety of the citizens which needs to be addressed on an urgent basis.” “During the last twenty years, the volume of the counterfeiting activity globally has increased 100 times and the size of trade is 10% of the legal international trade (around 2% of the world’s overall economic output),” he added.
Deep Chand, Advisor, FICCI CASCADE, and former Special Commissioner of Police, New Delhi, emphasised the need for consumers being continuously made aware of the detrimental impact of illicit products. Consumer awareness campaigns that explain how to differentiate a spurious product from a genuine product, to demanding a copy of the bill from the seller, along with the harmful consequences of buying illegal products vis a vis a genuine one, needs to be explicitly conveyed. Increasing the rule of law and enhancing effectiveness of penalties and sanctions is important to curb the mounting hazards of counterfeiting and smuggling, he added.
