Customs dept busts agarbatti smuggling racket from Vietnam that misused FTA

New Delhi: The Customs department on Wednesday caught illegal imports of restricted items – agarbattis (incense sticks) and its powder – from Vietnam in large quantities in blatant violation of the Association of Southeast Asian Nations (ASEAN)-India Free Trade Agreement (FTA), a finance ministry official said.

“In a major drive against the smuggling of agarrbattis from Vietnam, Customs officials on Wednesday arrested Bharat H. Shah and his son, Ronik Shah in Chennai after seizing 161.94 MT [metric tonnes] of agarbattis and 68.36 MT of agarbatti powder, which were found concealed in containers imported by Indian Agarbatti Manufacturers (IAM), Bengaluru. This is one of the biggest seizures of restricted items in recent times at the port,” the official said requesting anonymity.

IAM did not respond to HT’s queries.

While Bharat H Shah and his son Ronik could not be contacted.

The official said the importer had declared to the Customs that these containers contained joss powder and premix powder for making incense sticks.

“Joss powder is normally attracts a 15% Customs duty. However, the duty is ‘nil’ under the FTA with ASEAN, which includes Vietnam,” he said.

Joss powder is a herbal substance used for manufacturing mosquito coils and incense sticks.

“The importer was trying to take advantage of the FTA as well as smuggle restricted agarbattis,” he said.

Agarbattis are placed in the restricted category since August 2019 to protect domestic manufacturers and cannot be imported without a licence.

Acting on inputs that some unscrupulous importers were clandestinely smuggling agarbattis from Vietnam after the item was restricted for import last year, the Customs used data analytics to identify the suspect importer, IAM, the official said.

“A strict vigil was kept on its six imported containers that had landed at Chennai port. The containers said to contain joss powder and premix powder for making incense sticks revealed huge quantities of undeclared agarbatttis and agarbatti powder concealed behind the declared goods,” he said.

The Customs officers searched the office and residential premises of the importer at Bengaluru and apprehended the Shahs, both of whom had planned the smuggling, he said.

“Upon enquiry they disclosed that they had ordered two more containers from Vietnam, which were in the pipeline. At Chennai port, these two containers were identified and searched, which again revealed concealed agarbattis in huge quantities,” he added.

The seizures and arrests are part of a nationwide drive by Customs officials to stop the smuggling of agarbattis, which are on the restricted list of import, he said.

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