Our commitment to preserving traditional crafts, ensuring access to genuine, quality goods crucial for safeguarding economy and security: Director for Industries & Commerce, Govt of Karnataka

By City Today News (City today.media) on July 30, 2024

* Effective interventions required as Karnataka faces a range of illicit trade including gold, endangered species and red sanders smuggling
* Scaling multi-dimensional efforts can save India $159 billion from money laundering driven by illicit trade - FICCI CASCADE Report

BENGALURU, 30 July 2024: Ms Gunjan Krishna, Commissioner for Industrial Development & Director for Industries and Commerce, Govt of Karnataka today while addressing FICCI CASCADE's conference on Combating Illicit Trade: Insights, Challenges, and Solutions said, "Smuggling and counterfeiting not only finance terror groups but also undermine global security, posing severe threats to safety and economic growth. The proliferation of counterfeit products, including pharmaceuticals and consumer goods, endangers public health and safety, with the WHO reporting that 1 in 10 medicines in low- and middle-income countries is substandard. In response, Karnataka is taking decisive action by supporting 43 GI-tagged products and working closely with law enforcement to combat illicit trade. Our commitment to preserving traditional crafts and ensuring access to genuine, quality goods is crucial for safeguarding our economy, health, and security."

Ms Prabha Rao, Executive Director, South Asian Institute for Strategic Affairs and Scholar, Institute for Defence Studies and Analyses said, "Counterfeiting and smuggling undermine legitimate businesses, government revenues, heritage, and the livelihoods of artisans. To combat these illicit practices, it is crucial to engage grassroots communities and local leaders, raising awareness about their severe economic, health, and societal impacts."

Mr P C Jha, Advisor, FICCI CASCADE and Former Chairman, Central Board of Indirect Taxes and Customs (CBIC), said, "In recent years, we have made tremendous gains in advancing our formal economy, moving steadily towards our goal of becoming a developed nation. However, amidst these advancements, one critical challenge remains largely overlooked: illicit trade. Illicit activities, such as counterfeiting and smuggling, pose significant threats to our economic stability and development. It needs to be highlighted that tackling and mitigating counterfeiting and smuggling is essential to achieving a $5 Trillion Indian economy."

"In October last year, FICCI CASCADE in a novel report, said that when India's economy crossed the $3 trillion mark in 2021, money laundering in the country reached $159 billion, highlighting the severe impact of illicit markets. As India strives to transform its economy into a $5 trillion powerhouse in the coming years, the current trade composition of smuggling at 30 percent would make the trade value at $1.5 trillion," added Mr Jha.

This magnitude of the problem was highlighted in a FICCI CASCADE report in October 2023, titled 'Hidden Stream: Linkages between illicit markets, financial flows, organised crime and terrorism'

Mr. Deep Chand, Advisor, FICCI CASCADE and Former Special Commissioner of Police, New Delhi, said, "Just last week, Bengaluru Customs officials made a significant breakthrough by intercepting a major gold smuggling attempt. They seized 2.57 kg of gold, estimated to be worth Rs 1.68 crore, at Kempegowda International Airport. Apart from gold smuggling, Karnataka also faces various other forms of illicit trade like red sanders, drugs, including synthetic drugs, endangered wildlife species, illegal cigarettes, etc. More interventions are required to control this menace."

"However, it must be said that the Karnataka government and the enforcement agencies have been making consistent efforts and have done a remarkable work in addressing the menace of illicit trade. Their systematic and vigilant approach has led to the successful seizure of numerous illegal goods, reflecting their dedication to addressing smuggling and counterfeiting. I am confident that their ongoing efforts will play a vital role in supporting our broader fight against illicit trade and ensuring a safer, more secure environment for all," he added.

Dr Kotraswamy M, Commissioner, Bengaluru North CGST Commissionerate highlighted that to effectively combat illicit trade, we must form a united front—a human chain of solidarity and resolve against this global menace. Collaboration between central agencies, state enforcement bodies, and civil society is essential to successfully tackling this challenge and safeguarding our economy and society.

Karnataka has been facing a range of smuggling issues, with authorities making significant strides in uncovering various criminal networks. They have successfully dismantled numerous operations, including interstate drug rackets, international wildlife trafficking rings, and extensive smuggling operations through airports, trains, roads, waterways, and ports.

The other eminent speakers in the seminar Mr. Siddhartha Agarwal, Co-chair, FICCI Karnataka State Council; Ms. Kameswari Subramanian, Former Chief Commissioner of Central Excise, Customs and Service Tax, Bangalore Zone & International Expert, Customs Law, Procedures & Trade facilitation; Mr. Kalyanam Rajesh Rama Rao, Additional Commissioner, Customs; Mr. Gunjan Arya, IPS, Deputy Director, Security, State Intelligence, Bengaluru; Mr. Prem Mahadevan, Senior Analyst, Global Initiative Against Transnational Organized Crime and Ms. Jyothi VK, General Counsel & Sr VP, Aditya Birla Fashion and Retail Ltd.

According to another FICCI CASCADE report titled Illicit Markets: A Threat to Our National Interests, which examined the impact of illicit trade in five key industries in India — Mobile Phones, FMCG-Household and Personal Goods, FMCG-Packaged Foods, Tobacco Products, and Alcoholic Beverages, the size of illicit market in the above-mentioned industries was Rs 2,60,094 crore for the year 2019-20, with the FMCG industry — household and personal goods, and packaged foods — together accounting for 3/4th of the total illicit value of goods in five key industries.