En­hance aware­ness to check il­licit trade: Ficci-KPMG re­port

Business Standard - - ECONOMY & FINANCE - PRESS TRUST OF IN­DIA

The govern­ment needs to take steps such as rais­ing aware­ness and mod­er­at­ing taxes on goods to check il­licit trade in the coun­try, said a Ficci-KPMG study.

It also said funds gen­er­ated through such trade prac­tices are used for ter­ror fi­nanc­ing and or­gan­ised crime.

“Many prom­i­nent ter­ror­ist or­gan­i­sa­tions such as Hezbol­lah, Lashkar-e-Taiba, Al Qaida, Ir­ish Re­pub­li­can Army, etc rely on il­licit trade for fi­nanc­ing up to 20 per cent of ter­ror op­er­a­tions,” the re­port said.

Ficci Sec­re­tary Gen­eral San­jaya Baru said il­le­gal trade in smug­gled, coun­ter­feit and pi­rated goods damp­ens the econ­omy. “It desta­bilises the le­gal in­dus­try, re­strains in­no­va­tion and in­vest­ments, re­duces govern­ment rev­enues and ham­pers the health and safety of con­sumers,” he said.

Ac­cord­ing to a re­port pub­lished by OECD and Euro­pean Union In­tel­lec­tual Prop­erty Of­fice in April 2016, it is es­ti­mated that the to­tal eco­nomic and so­cial costs glob­ally due to coun­ter­feit and piracy stood at $737-898 bil­lion in 2013 and is ex­pected to rise to $1.54-1.87 tril­lion by 2022.

Apart from this, the to­tal job losses glob­ally due to coun­ter­feit and piracy stood at 2-2.6 mil­lion in 2013 and is ex­pected to rise to 4.2-5.4 mil­lion in 2022.

The most com­monly coun­ter­feited and smug­gled goods are tobacco, cig­a­rettes, elec­tronic items, gold, ma­chin­ery and parts, al­co­holic bev­er­ages, auto com­po­nents, fast-mov­ing con­sumer goods, and mo­bile phones.

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