Govt to create list of economic offenders
The government wants to create a master list of all economic offenders in the country so as to sharpen its response to such offences, and to also prevent flight, and has asked all federal investigative and enforcement agencies to work together to create one, according to three officials in these agencies.
The move comes against the backdrop of an increase in number of bank frauds, investment scams, and other such misdemeanors.
In some of these cases, the offenders fled the country.
The Central Economic Intelligence Bureau (CEIB) has been entrusted with the job of creating the list, with agencies such as the Enforcement Directorate and the Central Bureau of Investigation, capital markets regulator SEBI, the tax department, the customs department, and the Directorate of Revenue Intelligence (DRI) providing inputs.
“This will be the first step towards identifying those committing multiple economic offences and could be a potential fugitive. This will lead to a coordinated and focused investigation in case a big scam is unearthed,” said an official in the tax department who asked not to be identified.
A threshold has been set for each agency and cases registered that involve amounts above that limit will be reported to CEIB. For example, customs will report cases registered for duty evasion of above ₹1 crore. In the case of the tax department, only raids conducted or authorised by the Central Board of Direct Taxes (CBDT) will be taken into account by CEIB while making the list.
“Most of our probe and enforcement agencies work in silos. So if a particular agency is investigating someone, a comprehensive list of economic offenders will help it know if the person on any other agency’s radar,” said an official in one of the enforcement agencies.
With both the US and China resorting to tariff hikes against each others’ exports, the global economy is staring at a full-fledged trade war between two of its largest economies. Most people see this stand-off as an outcome of US President Donald Trump’s efforts to rejuvenate domestic manufacturing at the cost of Chinese exports. What was being ignored, and has come out in the open after China decided to impose 25% tariffs on soybean imports from the US, is the implication this trade war can have on agricultural trade between the two countries.
That the US export market has played an important role in the rise of China as an economic superpower and leading exporter in the world is well known. China’s merchandise trade surplus (trade in goods) with the US was just $6 million in 1985, the earliest period for which China-US trade data is available from the United States Census Bureau. In 2017, China’s merchandise trade surplus with the US was $375.6 billion. China’s merchandise trade surplus with the US is greater than its overall trade surplus of $209 billion in goods and services in 2017. (Chart 1)
To be sure, China’s merchandise trade surplus is much greater than its trade surplus in goods and services. According to World Bank data, China’s merchandise trade surplus in 2016 was $ 494 billion, while its trade surplus in goods and services was just $ 249 billion. The US had a trade surplus of $38 billion in service trade with China in 2016.
What does not come out in the headline numbers on China’s in- creasing merchandise trade surplus however is the story of its growing trade deficit in agricultural trade with the world, and especially the US. According to statistics from the United Nation’s Food and Agriculture Organisation (FAO), the average share of food imports in China’s total food production between 1961 and 1965 was 1.2% by volume. This figure jumped more than eight times to 9.7% between 2009 and 2013, the last five years for which data is available. While China’s growing reliance on imports to take care of its food requirements is an important facet of its growth trajectory, what is even more remarkable is the dominance of just one commodity, soybeans, in China’s agricultural imports. According to FAO data, soybeans had an average share of just 2% in China’s total agricultural imports in value terms in the 1970s. This figure has risen to 32.8% in the present decade.
What explains this rapid increase in China’s soybean imports? FAO statistics give a breakup of domestic consumption of a product by various end-use categories: food, feed, processing, waste, seed and other uses. In the last decade, more than three-fourth of China’s domestic soybean consumption has been used for processing (Chart 2 ).
This is largely the story of soybean fulfilling animal feed requirements for China’s rising meat consumption. Rapid growth in incomes, especially in urban areas, led to a large increase in consumption of meat, especially pork in China. According to FAO, per capita consumption of pig meat in China was 11.39 kg/person/year in 1980, very close to the global average of 11.86 kg/person/ year. By 2013, the latest period for which data is available, this figure increased to 38.43 kg/person/year for China, more than double the global average of 16 kg/person/year in that year.
Among the biggest beneficiaries of Chinese opulence leading to rise in pork and hence soybean consumption, has been the US. An analysis of US agricultural trade data shows that soybean exports to China have increased consistently and now account for more than one-fifth of its bulk agricultural exports. Soybeans as a whole have a more than 40% share in bulk US agricultural exports (Chart 3 ).
With China putting a 25% tar-
NEW DELHI: NEWDELHI: US AGRI TRADE DATA SHOWS THAT SOYBEAN EXPORTS TO CHINA HAVE GONE UP AND ACCOUNT FOR MORE THAN ONEFIFTH OF ITS BULK AGRICULTURAL EXPORTS