Smuggling worries

Smuggling of goods across the borders in small quantities is no unusual phenomenon but its magnitude in the context of Pakistan is thought to be immense and very costly for the economy of the country. Highlighting the issue, President, Lahore Chamber of Commerce and Industry (LCCI), Malik Tahir Javaid, said in a statement on 8th January, 2018 that smuggling had become a big threat to economic growth and costing the national exchequer heavily. A huge difference in taxes/duties between Pakistan and the neighbouring countries is encouraging smuggling. Besides, Afghan Transit Trade Agreement has become the main source of smuggling which is carried out mainly on the land routes of Chaman and Landi Kotal under the cover of transit trade. Afghan imports are smuggled back into Pakistan with the help of Afghan traders.
We feel that the statement of Tahir Javaid needs to be taken seriously with a view to finding the solution of the issue. It is true that smuggling has become a problem which is inflicting huge losses on the national exchequer as well as the economy. Vast amounts of goods are traded almost freely through the borders of Afghanistan, Iran, China and India by unscrupulous traders who make billions of rupees through this illegal trade every year which is facilitated by corrupt officers posted at the borders. As a consequence, local markets in the country are flooded with smuggled goods and local industries are suffering and struggling for survival as smuggled goods are easily available everywhere and attracting buyers who prefer foreign merchandise at cheap prices. The difference in import duties between Pakistan and the neighbouring countries works as an incentive to profit from this unlawful activity. According to the LCCI President, smuggling is carried out in a number of shapes like under-invoicing, undervaluation of goods, misclassification, falsification of documents, misdeclaration of country and short landing transit or re-export of goods. Some of the merchandise destined for Afghanistan from Karachi port are off-loaded within the Pakistani territory with the connivance of corrupt officials. The low prices of smuggled goods discourage the local industry and undermine the prospects of employment in the country besides affecting the overall morality of citizens who consider this illegal practice as a normal way of life. Although it seems impossible to completely eliminate this practice, a few steps could be taken to reduce the menace. For instance, scanners could be installed at the border checkpoints and a crackdown should be launched, particularly in the Bara markets, to control the cross-border smuggling and ensure that only customs and tax duty paid items are sold in the market. Afghan Transit Trade Agreement needs to be reviewed in order to check the flow of smuggled goods through this source. Pakistani policymakers also need to have a close watch on the duties/customs imposed on the imported goods in the neighbouring countries to reduce the chance of smuggling into Pakistan. Pakistani officials involved in direct or indirect assistance of smugglers also need to be strictly punished in order to discourage the practice. And, finally, a campaign should be launched to inform the public at large that such a practice is detrimental to the interests of the country and, therefore, it should be avoided. Most of the people buying the smuggled goods do not even know that they are encouraging an illegal activity and working against the interests of the country.