Govt. trying to prevent smuggling of goods: Pranab Mukherjee

November 4th, 2009 - 6:34 pm ICT by ANI  

Pranab Mukherjee New Delhi, Nov.4 (ANI): Union Finance Minister Pranab Mukherjee on Tuesday said that the government had received information about entry of goods into the country through smuggled routes and the government was trying to plug that.

“If there is regular credit and if they try to dump, any country, not only China, any country tries to dump their products in a country by selling it at an unusually low price, then there is a regular institutional mechanism to deal with it through anti-dumping mechanism. But if there is smuggling, informal trade, prevention is the best way to prevent this smuggling and there the Directorate of Enforcement and various other governmental agencies are there, state government also has agencies. But, we are told that some goods are coming through smuggled routes and we are trying to prevent that,” said Mukherjee.

China and some South East Asian countries are becoming a major source of worry for Indian revenue intelligence agencies.

The authorities say some Chinese manufacturers are evading anti-dumping duty their goods would have attracted in European Union (EU) countries, by routing the same through India.

‘Country of Origin Fraud’ is increasingly attracting the attention of customs enforcement authorities across the world.

In fact, one such case brought a European Anti-Fraud Office (OLAF) team to India last year on suspicion that some goods, imported by EU countries from India, were actually of Chinese origin, sources said.

Mukherjee also defended the Reserve Bank of India’s (RBI) recent purchase of gold worth 6.7 billion dollars.

“We have money to buy gold. We have enough foreign exchange reserves by which we can meet our import requirements. This flow to foreign exchange reserves is continuing because people have confidence on the resilience of Indian economy,” said Mukherjee.

The International Monetary Fund has sold 200 tonnes of gold to the RBI for 6.7 billion dollars, quietly executing half of a long-planned bullion sale that has threatened to slow gold’s ascent.

The RBI said the purchase was an official sector off-market transaction and was executed during Oct. 19-30 at market-based prices.

An IMF official said the sale was concluded at an average price of about $1,045 an ounce and that the transaction would be paid in hard currency and not in IMF Special Drawing Rights.

The deal, which surprised traders who expected China to be the most likely buyer, will relieve the gold market of some uncertainty over how and when the IMF would sell 403.3 tonnes of gold, about one-eighth of its total stock. The deal will increase India’s gold holdings to the tenth largest among central banks.

On runaway prices of foodgrain, vegetables and other essential commodities, Mukherjee said there were measures to shield the poor from the impact of inflation.

“I understand the sufferings of the common people. I understand that if the daily essentials, prices of essential commodities increase and if it goes beyond the reach of them, naturally everybody will suffer. But these are certain factors which we cannot ignore. To provide relief to the more vulnerable section of the society, we have this system of differential treatments where those (whose) incomes are less, to give them subsidised items through public distribution system,” said Mukherjee. (ANI)

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