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$5-10b smuggled goods being poured into Pakistan annually: Commission report

$5-10b smuggled goods being poured into Pakistan annually: Commission report

 KARACHI: The total value of goods smuggled into Pakistan has been estimated at over $5 billion per annum – according to estimates of the commission constituted on ‘smuggling of arms and ammunition’.

Sources told that former FBR Member Customs, Ramzan Bhatti has conducted detailed investigation of smuggling into Pakistan and opined that the total volume/value of smuggled items is estimated over $5 billion.

Sources were of the view that the estimated value of smuggled items on annual basis ranges between $5 billion to $10 billion. However, the figure taken in the report has been on the lowest side of $5 billion. For example, huge smuggling of gold and liquor has been taking place on annual basis. Thus, the estimated value of smuggling could ranges between $5 billion to $10 billion.

One-Member Commission has also given details of the smuggled items from Afghanistan, Iran, China, UAE, India and other countries, sources said. Referring to the report, sources said that the exact figures regarding total volume of smuggling are not available. However it can be safely assumed that a major chunk (over 60 percent) of merchandise imported by Afghanistan is meant for re-export/smuggling into Pakistan.

Most of the goods brought in transit to Afghanistan either through Pakistan or Iran have no consumption in Afghanistan. The latest example is clearance of 52,000 vehicles smuggled from Afghanistan under the Amnesty Scheme allowed for a period of only one month. Similarly Iranian goods i.e. petroleum products, plastic material/products, fabrics, carpets etc are frequently smuggled.

The UAE is the main source of smuggling of liquor through fishing boats/trawlers and launches etc besides the transfer of liquor from the ships in the high seas to small boats for satisfying the thirst of Pakistani bootleggers. Gutka and livestock besides silk saris are smuggled from India.

The total volume of smuggled items is estimated to be over $5 billion. Most of the smuggled items are either banned for import or subject to higher rates of taxes with cumulative effect of over 50 percent. The revenues loss is thus estimated to be over two hundred billion rupees, sources said.

Other important areas feeding the black economy are stock exchanges, Benami and under-valued transactions of real estate, kick-backs, plundering of public money/resources and other illegal activities.

Sources said the Commission has tried its best to point out various sources of black economy and the extent of revenue of leakages by suggesting many remedial measures including the recruitment of qualified persons, upgrading the training standards, improving the SOPs / business processes and providing the necessary wherewithal to prevent smuggling and above all to develop a computer led strategy to plug all the loop-holes in revenue collection.

The Commission has also suggested in-depth studies of various sources of black economy with a view to force the unscrupulous persons to come into the documented economy which would provide the required increase in revenue collection and improve the tax-to-GDP ratio over time. Sources added that crime itself perpetuates the generation of black money. The commission has also referred to the main sources of such ill-gotten wealth, sources added.