Illegal cigarette trade in Punjab on the rise: FICCI report

  • HT Correspondent, Hindustan Times, Ludhiana
  • Updated: Aug 13, 2015 18:35 IST

FICCI's Committee Against Smuggling and Counterfeiting Activities Destroying the Economy (CASCADE) unveiled its nine sector report 'Illicit Market: A Threat to Our National Interest' on Monday.

The report is a quantitative study evaluating the impact of illicit markets on various economic aspects in the manufacturing industry including sectors like FMCG packaged foods and personal goods, computer hardware, automobiles, mobile phones, tobacco and alcohol and secondly the media and entertainment industry including broadcasting and motion picture sectors.

As per the report, the total loss to the government estimated for 2014, on account of the illicit markets in respect to the seven sectors in manufacturing industry is Rs 39,239 crore. It was pegged at Rs 26,190 crore in 2012. The loss is inclusive of both indirect and direct taxes- the indirect taxes component amounting to Rs 34,020 crore.

The study has also discovered that during the course of two years from 2011-12 to 2013-14, revenue loss to the government has grown-up exponentially by Rs 13,049 crore, an increase by 49.8%. Amongst the various sectors, the maximum revenue loss to the exchequer on account of counterfeiting and illicit trade is attributed to tobacco products at 23%, estimating a revenue loss of Rs 9,139 crore.

Ironically Punjab has seen a significant growth in illicit trade among these sectors in the last couple of years. It is one of the fastest growing markets for illegal cigarettes and alocohol in the country.

PC Jha, adviser, FICCI CASCADE and former chairman of Central Board of Excise and Customs, said that during the last 20 years, the volume of the counterfeiting activity has increased 100 times and the size of trade in counterfeited goods is 10% of the legal international trade (around 2% of the world's overall economic output)."

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