Customs Intelligence’s raid on Apan Jewellers and finding 286kg gold apparently without valid documents reveal nothing new since the jewellery business in Bangladesh has been going on for decades with smuggled gold.
The current government policy allows import of gold and silver, subject to permission from Bangladesh Bank, but in Bangladesh, there was no import of gold through LC (letter of credit) in the last three decades, customs officials said.
However, the jewellery business is thriving.
Customs Intelligence and Investigation Directorate (CIID), customs and different other agencies seized over 2,000kg of gold in the last three years.
Police investigators believe that the gold quantity smuggled in was many times more than the amount they had seized. A small portion of the smuggled gold feeds local demand while the rest goes to India, the world’s second largest consumer of gold after China, they said.
A section of biggies — political and government high-ups — and some dishonest officials in the administration, law enforcement and intelligence agencies collude with around 30 gold smuggling syndicates, according to an intelligence agency report submitted to the Prime Minister’s Office in 2015, jewellers and investigators.
This is alarming since smuggled gold “is the oxygen for other crimes” like arms and drugs smuggling, human trafficking, money laundering and hundi, a customs intelligence official said.
Ahmed Shafat, son of one of the owners of Apan Jewellers, reportedly bragged about being a gold smuggler to the victims of Banani rape, according to the testimony of one of the two girls allegedly raped.
Shafat and others accused in the case also boasted about their wealth and claimed that police would not touch them when the two girls warned that they would go to police, a victim had said.
A gold shop owner and two others involved in the business for a decade told The Daily Star yesterday that the jewellery business was entirely depended on smuggled gold.
The three small traders from Old Dhaka’s Islampur, Tantibazar and Rajdhani Super Market areas unanimously said many other jewellery traders in the capital were dependent on smuggled gold just like them.
There are big, medium, and small gold smugglers, they said wishing anonymity. The trio receive the gold after it had changed hands six to seven times in the country.
One of them said there were people who maintain gold smuggling syndicates and they bring in gold in maunds.
To cover up the smuggling they keep a fake record which says all the gold was either recycled gold or those were brought in by expatriates, said another trader.
“But, the amount brought in by expatriates is negligible,” the trader added.
A traveller can bring in up to 232 grams of gold bullion, equivalent to 20 tolas, from abroad paying a tax of Tk 52,000 under baggage rules. For gold ornaments, one can bring in 100 grams without tax. Bangladesh imposes Tk 1,500 tax per gram for the next 200 grams, said Assistant Commissioner of Customs Ahsanul Kabir.
Asked whether they had any information about large jewellery shops selling smuggled gold, Moinul Khan, director general of CIID, said they had intelligence information about several businesses, including Apan Jewellers.
He said smuggled gold “is the oxygen for other crimes”.
Moinul, however, said gold smuggling had reduced significantly as the CIID now better coordinates with other agencies concerned to stop smuggling. Due to this, the smugglers were carrying gold bullions in their abdomen and rectum risking their lives, he said.
He said they alone seized around 1,100kg of gold and arrested 150 people in the last three years.
Deelip Kumar Agarwala, general secretary of Bangladesh Jewellers’ Samity, claimed that the local demand was met by recycled gold and what expatriates bring in under baggage rule.
About the government’s rules on importing gold, he said since 1971 the import duty on per kg of gold was Tk 12,500. But three fiscal years ago the import duty on per kg of gold was raised to Tk 2,57,500 with five percent VAT (value added tax). He said the VAT in India was only 1 percent.
The association has 663 registered members. There are several thousand jewellery shops across the country.
Of the around 30 syndicates involved, 23 operate inside Bangladesh and the rest from outside. The gold is smuggled through Hazrat Shahjalal International Airport, Shah Amanat International Airport and Osmani International Airport, according to the intelligence agency report.
Eleven of the 23 operating in Bangladesh are directly involved in gold smuggling and the others smuggle gold with money exchange as their front business.
And of the 11, seven use Shahjalal International Airport, three Shah Amanat International Airport and one Osmani International Airport.
The syndicates are backed by some political leaders and top officials in the police and Border Guard Bangladesh, the report said.
“They are so powerful that they always remain beyond the reach of law enforcement agencies,” said a detective who deals with gold smuggling cases.