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Tightened rules leads to surge in gold smuggling cases by 400%

About 148.71 kg gold worth Rs 40 crore were smuggled between April and September in Mumbai airport alone

Shrimi Choudhary  |  Mumbai 

Gold jewellery sees lacklustre sale
Gold

Uncertainty over disclosure norms of sales under the Prevention of Money Laundering Act (PMLA), have led to an exponential increase in smuggling. The precious metal had seen an unprecedented 400 per cent increase in cases of smuggling seizures in just 6 months via air route, revealed air intelligence unit of custom department in Mumbai.

According to the air intelligence data, about 148.71 kg worth Rs 40 crore were smuggled between April and September in Mumbai airport alone. This is against 89 cases registered in the same period a year ago, worth Rs 17 crore.

Interestingly, in 2016-17, total 301 cases were registered by Mumbai custom unit, in which weighing 167 kilograms, worth Rs 46 crore were seized.

According to the sources, this rise could be attributed to multiple factors, which include, lack of awareness about making it mandatory for jewellers to keep record of personal identification in case of buying of worth Rs 50,000 and above.

However, the government on October 6, had revoked the rule. So now the previous rule is applicable where personal identity is mandatory only when the jewellery purchase is of Rs 2 lakh and above.  

"The another key factor for such an increase is due to the price difference between India and Dubai markets. As most of the seizure was seen to be smuggled from Dubai. There are majorly two-three active groups who were assigned to purchase in Dubai. And then the same has been brought back in India, explained an officer. Currently, the difference between the prices varies between 2,500-3,000 per 10 grams. This makes the deal attractive for smugglers.

Besides, the intelligence units have observed that there is a significant rise in smuggling the precious metal via air route as compared to sea route which was earlier the most sought route by the smugglers. Typically, is mostly smuggled into India from Dubai, Singapore, Abu Dhabi, Hong Kong, Mauritius and Nairobi.

First Published: Mon, October 16 2017. 20:23 IST
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