For underworld, bigger profits add glitter to gold
It has suddenly become much more profitable to smuggle gold, and the underworld is very interested. Smuggling syndicates have stepped up the action, often employing passengers who carry the gold for them. Manish Pachouly and Faizan Haider report.delhi Updated: Jul 07, 2013 11:23 IST
It has suddenly become much more profitable to smuggle gold, and the underworld is very interested.
Consider this: In June, customs in Delhi and Mumbai seized 35 kg of gold worth over Rs 9 crore. There were 10 seizures in Delhi alone. And sources in Mumbai said that 10-12 kg of smuggled metal is getting past customs and into waiting hands in the city — every day.
Smuggling syndicates, which had operated at a low intensity since liberalisation in the 1990s relaxed controls, have stepped up the action, often employing passengers who carry the gold — and the risk — for them.
The reason for the sudden surge: With the fall in the value of the rupee against the dollar, gold costs Rs 2.5 lakh per kg more in India than in Dubai, a price gap that has widened from Rs 1 lakh in less than a month’s time.
Import duties have risen to 8% from 6% and some banks have stopped selling gold coins, heightening Indians’ traditional hunger for the yellow metal.
Syndicates pay the flyer Rs 50,000 per kg plus costs.
If caught, he gets nothing. That’s a clean profit to smuggling groups of just under Rs 2 lakh per kg for a three-hour operation — the time it takes to fly someone with the cargo from Dubai.
A customs official said that organised syndicates were using “carriers” in large numbers, and another added: “The moment a carrier is caught, the syndicate members send their men to pay the bail amount and get him out.”
The carriers get bail easily as the offence is bailable.
Officials said smugglers had come out with innovative ways to conceal gold.
In recent cases in Mumbai and Delhi, officials found carriers concealing gold bars in socks, undergarments, in trouser waistbands, shoe soles and false cavities in handbags.
One man even tried to bring in gold in the form of staple pins. Gold has also been found inside TV sets.
Customs department sources also said that last month has seen a change in smuggling pattern, with more and more gold bars being smuggled than the earlier practice of smuggling jewellery.
Legal imports have plummeted to 40 tonnes in June from 162 tonnes in May and 142 tonnes in April.
“The syndicates are taking advantage of this by enhancing smuggling attempts to push gold, obtained through illegal channel, in the market,” said a gold trader.
Kumar Jain, vice-president of Mumbai Jewellers Association, said the government should take measures to reduce the gap in Dubai and India prices.
“They should also consider bringing down the duty. After the duty hike recently, so many attempts of smuggling have taken place,” said Jain.
First Published: Jul 06, 2013 20:49 IST