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Financial year 2013-14

NEW DELHI: Financial year (FY) 2013-14 has seen the highest increase in gold smuggling in India’s recent history. Smuggled gold seizures this FY have increased five-fold compared to FY12-13. From a mere Rs 100 crore worth of gold seized in FY 2012-13, this FY various agencies have seized over Rs 565 crore worth of gold. 

Sources said the value of gold actually smuggled through this FY could be over 10-20 times this amount. Some estimates put seizures at 1-2% of actual smuggling. Only recently, finance minister P Chidambaram had said that gold smuggling had touched an estimated figure of 3,000 kg every month. Calculated at current gold prices, this could easily breach the Rs 9,000 crore worth gold smuggled in the last FY. 

If World Gold Council’s estimates are to be believed, close to 200 tonnes of contraband gold came into India in FY 13-14. That would be close to Rs 60,000 crore in value. These estimates, however, are refuted by Indian agencies. 

A result of curbs in the form of 10% duty on import and RBI rule of 80:20 import to export ratio, gold smuggling has been troubling agencies across the country. Directorate of Revenue Intelligence (DRI) has alone seized Rs 245.92 crore worth of gold in 148 cases of smuggling compared to just Rs 44.80 crore in 40 cases. DRI has also arrested 263 people for gold smuggling this FY as against 30 last FY. 

The curbs, however, have served their intended purpose of bringing the current account deficit (CAD) from $ 88 billion in FY 12-13 to $ 32 billion in FY 13-14. Gold imports, though, have been contributing to about 30% of the trade deficit since 2009. 

Curiously, gold seizures have even surpassed narcotics seizures this year. While DRI seized Rs 245 crore worth of gold, it seized only Rs 209 crore worth of narcotics in FY 13-14. This is in stark contrast to figures of last FY when Rs 194.84 crore of narcotics were seized by DRI as against only Rs 44.8 crore of gold. 

The FY has also seen high number commercial fraud cases being detected with duty evasion amounting to over Rs 3,000 crore. This is, however, lesser than the haul in FY 12-13 when DRI mopped detected evasion of close to over Rs 5000 crore. 

The agency has, however, improved its duty recovery record with Rs 1,234 crore in duties recovered in FY 13-14 as against Rs 1,130 crore in FY 12-13.

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