KOCHI: With the Union Budget hiking customs duty on import of gold, the state is likely to witness a surge in smuggling of the yellow metal. Kerala witnessed the highest number of gold seizures in the country in the last financial year.
TS Kalyanaraman, chairman and managing director of Kalyan Jewellers, raised concern over spike in customs duty. “The increase in import duty of gold from 10 per cent to 12.5 per cent may affect short-term sentiments on gold buying. It might lead to an increase in illegal supply of gold in the market,” he said.
According to the Customs Department, over 100 kg of smuggled gold was seized from airports in the first quarter (April-June 2019) of this fiscal alone. Over 85.7 kg of gold was recovered from Thiruvananthapuram, Kozhikode and Kannur airports between April 1 and June 30. From Kozhikode airport alone, 56.6 kg of gold was recovered in 110 smuggling incidents. In the last fiscal, 417 kg of gold was seized from four airports across the state and 1,102 cases were registered, which is the highest in the country.
However, Customs Commissioner Sumit Kumar is confident that his units in the state are capable of thwarting all smuggling attempts. “We welcome the Union Budget. We are ready to tackle any challenges regarding attempts to smuggle gold through airports in Kerala. We are strengthening our land-based formations across the state,” he said.
On the other hand, a retired officer of Directorate of Revenue Intelligence (DRI) said that it would be a major challenge for DRI and Customs to thwart smuggling attempts in the new scenario. Kerala has the highest gold consumption in the country. Its per capita expenditure is close to `200. “At airports, the Central agencies are already short of staff. Kerala has a vast coastline which is vulnerable to smuggling. Only a limited number of contraband seizures were reported through sea route. Already the arrival of legitimate gold is well below the market demand,” he said.