Why in News?
- The Finance Minister of India has recently said that officials should find out whether there is a correlation between higher gold imports and smuggling, and whether a pattern is emerging in the detection of smuggling.
- It has been noted that whenever there is a surge in gold imports, gold smuggling also typically goes up.
- According to the Directorate of Revenue Intelligence’s (DRI’s) Smuggling in India Report 2021-22, a total 833 kg of smuggled gold, worth around Rs 500 crore, was confiscated in FY 2021-22.
- 2020-21 had witnessed a decline in smuggling from the Gulf region because flights were cancelled due to the Covid-19 pandemic.
- More than 11 tonnes of gold have been seized in 16,555 smuggling cases at airports across India in the five years ending August 2020.
- The figures reported was of the gold that was seized, the smuggling that succeeded could be much more than what the agencies confiscated.
- According to the World Gold Council (WGC), smuggling could increase by 33% to touch 160 tonnes in 2022 compared to the pre-Covid period due to the increase in the import duty on gold to 12.5% from 7.5%.
- In the last 10 years, Maharashtra has smuggled most of the Gold in India followed by Tamil Nadu and Kerala
- According to the DRI Report, 73% of the gold caught had been brought through Myanmar and Bangladesh.
- 37% of all the gold seized in FY22 was from Myanmar. 20% of it originated from West Asia.
- Many international reports suggest that smuggled gold is brought into Myanmar from China through the towns of Ruili and Muse on the Chinese and Myanmarese sides of the border respectively.
- Muse is located in the Shan State in Northeastern Myanmar and Ruili is in the Dehong Dai Prefecture of Yunnan Province, China.
- Gold imports through official channels, involving a major outflow of foreign exchange, have also been rising.
- Imports worth Rs 3.44 lakh crore were reported in 2021-22, up from Rs 2.54 lakh crore in 2020-21.
- According to the World Gold Council, India, the world’s second-biggest gold consumer after China, imports about 900 tonnes of gold a year, consumption in India was 797.3 tonnes in 2021 (Highest in past 5 years).
- India imports gold dore bar as well as refined gold.
- In the last five years, imports of gold dore bars made up 30% of the total official imports of the yellow metal in India