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Gold smuggling: A golden corridor

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Every plane landing from the Middle East now carries 40-80 kg of the precious metal, translating into Customs duties between Rs 86.8 lakh and Rs 1.74 crore. Every plane landing from the Middle East now carries 40-80 kg of the precious metal, translating into Customs duties between Rs 86.8 lakh and Rs 1.74 crore.
SummarySmuggling is back at Kerala airports as hiked import duty and restrictions make the yellow metal even more precious.

Smuggling is back at Kerala airports as hiked import duty and restrictions make the yellow metal even more precious. With a 400 per cent jump in arrests, 300 per cent in the value seized, Shaju Philip reports on another phenomenon — flights laden with gold

It’s raining gold at Kerala’s Kozhikode international airport. Every plane landing from the Middle East here now carries 40-80 kg of the precious metal, translating into Customs duties between Rs 86.8 lakh and Rs 1.74 crore. That’s just one flight, one airport. The state has two other international airports, at Kochi and Thiruvananthapuram, and the quantity of gold being brought in there is just slightly lower. Kerala gets an average of 120 flights from the Middle East a week. Do the maths.

The UPA government first hiked the import duty on gold in January 2012, raising it to 2 per cent, from Rs 300 charged per 10 grams earlier. It was raised to 4 per cent in the budget for 2012-13, 6 per cent in January 2013, 8 per cent on June 5 and finally 10 per cent in August. The government hoped that the steps would check India’s rush for gold — and hence its burgeoning current account deficit.

The rush, obviously, continues. What is being seen at Kerala airports, officials suspect, is smugglers using passengers as legal carriers of gold since the last month, ever since the Directorate of Revenue Intelligence (DRI) busted a few gangs, caught bringing in gold using mainly young women. Indians who have stayed abroad for at least six months are allowed to legally bring in up to 1 kg of gold, with import duty paid in foreign currency. Indians travelling abroad can get in gold jewellery worth up to Rs 50,000 in case of men, and Rs 1 lakh in case of women, duty-free.

Customs data show that 1,983 kg of gold, mostly in the form of bars, was brought into Kozhikode after paying duty in 2013. There is a duty in dollars amounting to Rs 2.17 lakh on each kilogramme. In November alone, 236 kg of gold landed at the airport. On a December day, the airport saw a flight with 98 passengers bringing in 98 kg of gold. At the Kochi international airport, 3,187 passengers officially brought in 282.65 kg in 2013. Thiruvananthapuram saw 221 passengers bring in 34.37 kg during the last year.

While some of these passengers may

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