Smuggling and Counterfeiting more dangerous than life threatening diseases like Cancer and COVID: Samir Kumar Mahaseth, Industry Minister, Govt of Bihar

Dec 06, 2022

• Government suffers tax loss of Rs 58,521 crore due to illicit trade in five key Indian Industries � FICCI CASCADE Report
• Products which cause maximum revenue loss to the exchequer: FMCG-packaged foods (Rs 17,074 crore), alcoholic beverages (Rs 15,262 crore) and tobacco products (Rs 13,331 crore)
• Illicit market in 5 industries, including mobile phones, FMCG-household and personal goods, FMCG-packaged foods, tobacco products, and alcoholic beverages is valued at Rs 2,60,094 crore

PATNA, 06 December 2022: Mr Samir Kumar Mahaseth, Industry Minister, Government of Bihar today said, "The problem of counterfeiting and smuggling is complex in nature. With no legal regulation and very little recourse, consumers are at risk from unsafe and ineffective products." It is important that consumers understand the multi-faceted complexities of this problem. Youth are the consumers of tomorrow, who can encourage and bring about the required change through their choices and behaviours, he added.

Addressing the FICCI CASCADE (Committee Against Smuggling and Counterfeiting Activities Destroying the Economy) programme on 'Preventive Strategies to Combat Counterfeiting and Smuggling' Mr Mahaseth emphasized that educating and generating awareness about the ill effects of counterfeiting and smuggling is the need of hour to combat this global scourge. He further suggested FICCI CASCADE to organize such youth awareness program in Bihar more frequently to motivate the youth of the state in achieving our objective in making India free from illicit trade. "Smuggling and Counterfeiting are more dangerous than life threatening diseases like Cancer and COVID", he added.

Mr Dipak Kumar Singh, Additional Chief Secretary, Department of Education, Government of Bihar said, "Uninhibited growth of counterfeiting and smuggling not only impact the economy of our country but also poses severe threat to public health and safety." Smuggling and counterfeiting leads to tax evasion which further slows down the pace of development of the country. He also emphasized the need to take a bill while making any purchase, to act as proof of purchase.

Mr P C Jha, Advisor, FICCI CASCADE and Former Chairman, Central Board of Indirect Taxes & Customs said, "Illicit trade is of grave concern, it undermines the nation's economy, damages brand integrity, and most importantly affects health and safety of the citizens which needs to be addressed on an urgent basis. During the last twenty years, the volume of counterfeiting activity globally has increased 100 times and the size of trade is 10 per cent of the legal international trade (around 2 per cent of the world's overall economic output). The problem of illicit trade is much more serious than it is commonly perceived."

Mr Rajiva Ranjan Verma, Former Director General, RPF, NCRB, Civil Defense, Home Guard & Fire Services and BPR&D said, "Raising awareness is an important aspect of combating illicit trade in terms of smuggling and counterfeiting which needs to be pursued vigorously." The role of youth is paramount in battling the menace of smuggling and counterfeiting, he noted.

The Minister also felicitated School Children for the inter-school competition organised by FICCI CASCADE on the theme 'Role of Youth in Making India Free from Smuggling & Counterfeiting'. The competition witnessed enthusiastic participation of students from over 40 school of Patna.  The list of the awardees are as follows:

Winners	Elocution Competition	Painting Competition	Jingle Writing Competition
1st Prize	Tannu Kumari, Kamla Nehru Girls School	Radhika kumari, Indra Prasad Singh Gangasthali High Secondary School	Jonshon Kumar K B Sahay Shekhpuri
2nd Prize	Siya Bharti, Govt. RGSS Shool, Bankipur	Sristy Rachna, Kamla Nehru Girls School	Roushni Kumari, Rabindra Baliya Vidhaya
3rd Prize	Abhishek Raj, Govt Boys Sr. Secondary School	Sagar Kumar, DPCSS (Miller) Sr. Secondary School	Manish Kumar, Govt. Boys Sr. Secondary School

The seminar discussed the importance of increased awareness on the hazards of counterfeiting and smuggling, and the need for effective enforcement to enhance India's economic development. The seminar also deliberated on FICCI CASCADE's recent report titled Illicit Markets: A Threat to Our National Interests, which examines the impact of illicit trade in five key industries in India - Mobile Phones, FMCG-Household and Personal Goods, FMCG-Packaged Foods, Tobacco Products, and Alcoholic Beverages.

The market for contraband and smuggled goods is thriving in India and is today one of the biggest challenges faced by Indian industry. The country is witnessing widespread smuggling in various product categories such as gold, cigarettes, cosmetics, medicines, jewellery, readymade garments, alcohol, capital goods and consumer electronics, which is severely hurting the country's economy. The problem gets more acute in states like Bihar as several of its districts share borders with Nepal and smugglers easily get products into the country and distribute them in the domestic market. 

FICCI has set up a committee CASCADE, with the participation of leading industries from all sectors of the economy to raise awareness against this issue and work with government and other agencies to fight the menace. FICCI CASCADE has recently released a report examining illicit market in 5 Key Indian industries, including mobile phones, FMCG-household and personal goods, FMCG-packaged foods, tobacco products, and alcoholic beverages. According to the report, the size of illicit market in the above-mentioned industries was ₹2,60,094 crore for the year 2019-20, with the FMCG industry - household and personal goods, and packaged foods - together accounting for 3/4th of the total illicit value of goods in five key industries.

The report further estimates that unlawful trade in the five above-mentioned industries results in a total estimated legitimate employment loss of 15.96 lakh. The estimated tax loss to the government due to illicit goods in these industries is Rs 58,521 crore, with two highly regulated and taxed industries, tobacco products, and alcoholic beverages, accounting for nearly 49% of the overall tax loss.

Illicit Market Size
Industry	Value (Rs In Crores)
Mobile Phones	15,884
FMCG - Household & Personal Goods	55,530
FMCG - Packaged Foods	1,42,284
Tobacco Products	22,930
Alcoholic Beverages	23,466

Tax Loss
Industry	Value (Rs In Crores)
Mobile Phones	2,859
FMCG - Household & Personal Goods	9,995
FMCG - Packaged Foods	17,074
Tobacco Products	13,331
Alcoholic Beverages	15,262