The Hindu Business Line : <I>Lanka unearths illegal spice exports to India</I>

Apprehensions raised by the Indian spices trading community about the illegal imports of certain spices appears to be true following a reported crackdown by the Sri Lankan Customs on a racket involving exports of Indonesian cloves and arecanuts to India under the Indo-Sri Lanka Free Trade Agreement (ISFTA).

According to a media reports from Colombo, the Sri Lankan Customs Intelligence exposed the racket engaged in exporting Indonesian cloves and arecanuts to India exploiting the concessions granted to Sri Lanka under the ISFTA.

Quoting Customs officials, the reports said investigations triggered by a tip-off from Indian Customs uncovered the racketeers who with the help of a Sri Lankan counterpart had shipped a total of eight consignments of cloves and arecanuts worth Rs 11.14 crore, producing forged country of origin export certificates to Indian Customs authorities in the past 3-4 months.

"This could be the tip of the iceberg," Sri Lankan Customs sources were quoted as saying.

A leading shipping line in Colombo, which the Customs believe is very much involved in the underhand operation, had issued bills of lading to prove the shipment had originated from Colombo.

The Customs had already arrested the Sri Lankan counterpart, who acted on behalf of the Indonesian exporter.

When contacted by the Customs, the Sri Lanka Commerce Department - which has the sole authority to issue the certificates of country origin - has verified that the certificates produced by the exporter to the Indian Customs were in fact forged, the report said.

Exploitation of facilities under the FTA was reported earlier when cloves were imported from Pakistan as produce of that country, besides being under-invoiced.

The incident came to light early last year when the Kochi Customs detained a consignment of 24 tonnes of cloves imported from Pakistan by a Bangalore-based company, declaring it as the produce of that country.

When the Spices Board took up the issue with the Indian Embassy in Islamabad, it was revealed that clove was not grown in Pakistan.

A Sri Lankan investigating officer was quoted as saying: "This type of illegal exports will have a negative impact on Sri Lanka's export industry as well as on the ISFTA operations."

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