Tuesday | Jun 03 2025 | 05:02:48 PM
New Delhi, May 29
FICCI CASCADE organised a seminar on Proactive Approaches to Combat Counterfeiting and Smuggling in Trivandrum of Kerala.
P Rajeeve, Minister for Law, Industries, and Coir, Government of Kerala said, “The smuggling of illicit and counterfeit goods poses serious challenges to our society. It compromises public safety, hampers economic development, and, in some cases, even fuels the financing of terrorist activities. Addressing this complex issue requires a collaborative, multi-stakeholder strategy that brings together government agencies, industry bodies, and civil society to protect our national security, economic integrity, and the well-being of our citizens”.
“The Government of Kerala remains firmly committed in tackling this growing menace through coordinated efforts with law enforcement, industry bodies, and community stakeholders. The government is leveraging advanced technologies such as the deployment of drones for real-time surveillance and tracking of illicit activities, particularly along vulnerable coastal and border areas. It is also heartening to see committed non-state actors like FICCI CASCADE playing a strong role by raising public awareness and advocating for the rejection of these illegal goods,” added Rajeeve.
A P M Mohammed Hanish, Principal Secretary, Department of Industries & Commerce, Govt of Kerala, said, “These unlawful activities are impacting bona fide industries and eroding government revenue. The government is committed to tackling this menace through a multi-pronged strategy that includes bolstering surveillance, leveraging advanced technology at checkpoints, and improving coordination among agencies. The support of civil society will also be a critical factor for the government to achieve success against smuggling. I thank FICCI CASCADE for organising this seminar, which will surely increase public awareness on the issue and enable better coordination among various stakeholders.”
P C Jha, Advisor, FICCI CASCADE and Former Chairman, Central Board of Indirect Taxes and Customs said, “India’s exponential economic growth has created a vibrant, aspirational consumer base. Between 1999-2000 and 2022-23, rural and urban consumption at current prices surged by 7.6 times in the country, driven by rising incomes, urbanisation, and greater access to education and opportunity. However, the mismatch between purchasing power and aspiration has created a fertile ground for the growth of illicit markets and counterfeiting. Smugglers are increasingly exploiting cost arbitrage and regulatory gaps to meet this unfulfilled demand.”
While chairing a panel discussion on policies to prevent counterfeiting and smuggling, Deep Chand, Advisor, FICCI CASCADE and Former Special Commissioner of Police, New Delhi, said, “The illicit market has expanded rapidly in rural India, especially among the growing classes of middle- and lower-income groups. What was previously confined to urban, higher-income areas has now significantly infiltrated rural regions, highlighting a concerning expansion in the scope and impact of counterfeiting and smuggling. However, it ought to be said that both the central government and the state government of Kerala have been active in curbing these activities.”
Other key speakers included Dr M I Sahadulla, Immediate Past Chairman, FICCI Kerala State Council; Baby Mathew Somatheeram, Chairman & Managing Director, Somatheeram Ayurveda Group & Convenor FICCI Tourism Committee; Dr. T Tiju , Commissioner of Customs (Preventive), Kochi; Mr Farash T, Deputy Commissioner of Police, Thiruvananthapuram; Dr. Arul R B Krishna, SP Railways, Thiruvananthapuram; Dr. B Govindan, Chairman, Bhima Jewellers; Kalliyoor Sasi, Vice President, Kerala Film Chamber, General Secretary, Kerala Film Society and Mr Anish P Joseph, Regional Business Manager Kerala - STN, HMD Global Oy.
Kerala’s 590-kilometre coastline along the Arabian Sea, while pivotal for trade and fisheries, has also rendered the state increasingly vulnerable to various forms of smuggling and illicit trade. Smugglers use the huge coastline to ship in contraband ranging from gold smuggling to narcotics trafficking. In addition to narcotics, the coastline is being used for smuggling banned tobacco products, foreign-origin electronics, and counterfeit consumer goods. As per reports, the government has been conducting raids and seizing illicit goods almost every day.
FICCI’s Committee Against Smuggling and Counterfeiting Activities Destroying the Economy (CASCADE) comprehensive 2024 report titled ‘Consuming The Illicit: How Changing Factors of Consumption Affect Illegal Markets in 5 Key Industries’ estimates the size of the illicit market in India at Rs. 7,97,726 crore in 2022-23. The 5 key industries impacted are FMCG (packaged goods), FMGC (personal and household care), alcohol, tobacco, and textiles & apparel. As per the report, illicit trade is undermining legitimate businesses, distorting competition, and significantly affecting the government tax revenues.
The report states that textiles and apparel with an illicit market size of Rs. 403915 crore in 2022-23 account for over 50 percent of the total illicit market in India. While FMCG (packaged foods) and FMCG (personal and household care goods) at an illicit market size of Rs. 2,23,875 crore and Rs. 73,813 crore, respectively, account for nearly 37 per percent of the total size of the illicit market in 2022-23.
The size of illicit trade directly is proportional to higher taxes, far more profound in tobacco and alcohol, which have been historically exposed to higher tax regimes. According to the report, in the case of tobacco products, over 50 percent of the illicit markets can be attributed to the effect of punitive tax on the industry, and similarly for alcohol, such an effect is 46 percent.
