Customs busts smuggling racket in Agarbattis through ASEAN FTA misuse
In a major drive against the smuggling of Agarrbattis from Vietnam, Customs officers on Wednesday arrested Bharat H. Shah and his son, Ronik Shah at Chennai after seizing 161.94 MT of Agarbattis and 68.36 MT of Agarbatti Powder which were found concealed in containers imported by M/s. Indian Agarbatti Manufacturers, Bangalore.
 
This is one of the biggest seizures of restricted items in recent times at the port.
 
The importer had declared to the Customs that these containers contained Joss powder and Premix powder for making incense sticks. Joss powder is normally chargeable to 15 per cent Customs duty but the duty is 'Nil' under the Free Trade Agreement (FTA) with ASEAN which includes Vietnam.
 
The importer was thus trying to take advantage of the FTA as well as use the items covered thereunder to conceal and smuggle restricted Agarbattis. The product is placed in the restricted category since August last year and cannot be imported without a licence.
 
Acting on credible input that some unscrupulous importers were clandestinely smuggling Agarbattis from Vietnam after the item was restricted for import, the Customs used data analytics to identify the suspect importer, M/s. Indian Agarbatti Manufacturers.
 
Thereafter, a tight watch was kept on its six imported containers that had landed at Chennai port. The containers said to contain Joss powder and Premix powder for making incense sticks revealed huge quantities of undeclared Agarbatttis and Agarbatti powder cleverly concealed behind the declared goods.
 
In a swift follow up action, the Customs officers searched the office and residential premises of the importer at Banglore and apprehended Bharat H. Shah and Ronik Shah, both of whom had planned the smuggling.
 
Upon enquiry they revealed they had ordered two more containers from Vietnam, which were in the pipeline. At Chennai port these two containers were identified and searched, again revealing concealed Agarbattis in huge quantity.
 
The seizures and arrests are part of a nation-wide drive by the Customs to stop the smuggling of Agarbattis, which are on the restricted list of import.
 
It may be noted that on account of large scale misuse of ASIAN FTAs a review of or complete withdrawal from the FTAs are being demanded by Indian Manufacturers.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
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    yerramr

    4 days ago

    This is a good work by Customs. Agarbathi manfg is a flourishing MSME and it's time we resort more to RTA instead of FTAs.

    Current Account and Forex Reserve Supporting Indian Rupee: Ind-Ra
    A rise in global uncertainty or geopolitical tensions often leads to capital seeking flight to safety, thereby foreign portfolio investments leaving the shores of emerging markets. COVID-19 also triggered this behaviour, and India witnessed a foreign portfolio investment (FPI) outflow of $16.05 billion in March 2020 and $1.97 billion during April-May 2020. However, unlike the episode of taper tantrum of 2013, the impact of foreign investors pulling their money out of India did not lead to any macroeconomic instability, says a research note.
     
    In the report, India Ratings and Research Pvt Ltd (Ind-Ra) says, "Interestingly, foreign exchange reserves increased to $517.64 billion (foreign currency assets: $477.81 billion) on 17 July 2020 from $476.88 billion ($442.21 billion) at end-March 2020. It is this swelling of foreign exchange reserves that in combination with benign oil prices and tepid imports, leading to a current account surplus, has helped the Indian rupee to remain broadly stable since mid-March 2020, despite deterioration in some of the other macro parameters such as retail inflation, fiscal deficits and negative GDP growth. Ind-Ra estimates the average value of rupee to be Rs75.98 per US dollar in FY20-21 (FY19-20: Rs70.88/US dollar).
     
     
    Surplus in services trade averaged $76.489 billion during FY15-16-FY19-20. 
     
    According to the ratings agency, due to the COVID-19 pandemic, the revenue growth expectations of leading Indian software companies are flat to low single digit for FY20-21. 
     
    Ind-Ra says it expects trade in services to decline 14% in FY20-21 to $73.0 billion. "Transfers or remittances is another big component of invisibles and averaged $65.24 billion during FY15-16-FY19-20. We expect net transfers to decline 25% in FY20-21 to $57.2 billion. According to the World Bank, remittance flows in 2020 are projected to decline across all regions in the world," it added. 
     
    India witnessed a surplus on current account during fourth quarter (4Q) of FY19-20 ($558 million, 0.1% of GDP) after a gap of 51 quarters. The last time India had witnessed a current account surplus was in 4QFY06-07 ($4,223 million). 
     
    Ind-Ra says it expects a current account surplus even in 1QFY20-21, as trade deficit declined to $9.12 billion and surplus in services trade during April-May 2020 was $13.98 billion. However, Ind-Ra estimates the current account to be in deficit of 0.1% of GDP ($3.3 billion) in FY20-21, which will be the lowest current account deficit in the last 16 years.
     
     
    As per the ratings agency, capital account of India has remained in surplus for most of FY2000-01-FY19-20; there have been only three instances (FY08-09, FY11-12 and FY18-19) when inflows in capital account fell short of covering the current account deficit. 
     
    It says, "Net foreign direct investments have been a major and the most stable source of inflows in the capital account. It averaged $35.13 billion as against net average portfolio inflows of $5.23 billion during FY15-16-FY19-20."
     
    "Loans (external assistance, government borrowings and short-term credit) are estimated to increase to $25.9 billion in FY20-21. Ind-Ra expects the capital account inflows to increase to $67.3 billion in FY20-21 (FY19-20: $83.2 billion), leading to $64.0 billion increase in foreign exchange reserves," the ratings agency concludes.
     
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    Ramesh Popat

    5 days ago

    So good to read some positives after too much bad news!

    Maharashtra extends lockdown till Aug 31 with gradual easing
    The Maharashtra government has extended the lockdown till August 31 but assured gradual easing as part of 'Mission Begin Again', an official announcement said here late on Wednesday.
     
    The development came hours after the Central government released guidelines for 'Unlock 3.0'.
     
    The state government has decided to continue all precautions as announced earlier, but gradually, restrictions are likely to be lifted during the month.
     
    Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
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