JALANDHAR: When the Enforcement Directorate detained a hawala operator, following an operation conducted in Phagwara last week, it was just a tip of the iceberg. There runs a flourishing hawala racket where agents use the provision of importing up to five kg of gold as a legal means to bring in hawala money. Phagwara based operator, Ashok Kumar was caught with Rs. 25 lakh in Indian currency, gold worth Rs. 5 lakh and Rs two lakh in foreign currency during a raid. The documents seized from his possession included some relating to the transfer of huge sums of money from his Canada based accomplice, Ravi Sharma to another accomplice in Dubai.
The money was used to purchase gold at Dubai’s free markets and sent to India through couriers masquerading as ‘Non Resident Indians.’ Enforcement Directorate officers here cave that the modus operandi used by Te Operators involved collecting money in foreign exchange from expatriate Punjabis settled abroad which is then sent to Dubai for buying gold. Since import of up to five kg of gold is permitted for Non Resident Indians, the hawala operators have set up a network of couriers, some of who make several trips in a month. Once in India, the gold is sold and the money used to make hawala payments. Officers say that this route has become very popular of late, with expatriate Punjabis settled abroad to send money to their families back home by evading the legal banking route, thereby depriving the country of several crores of foreign exchange every year. Five kg of gold costs about Rs. 25 lakh in the Indian market and the importer has to pay Rs. three lakh duty for five kg of gold.
Article extracted from this publication >> August 21, 1996
