Smuggling relates to the transportation of legally permitted goods through a secret unauthorized route to escape duties. Illegal trafficking of immigrants is also a form of smuggling. Counterfeiting is the act of producing or distributing fake or imitation goods or currency with the intent to deceive or defraud. Over the past few decades, counterfeiting has become a huge network of “international entrepreneurs,” who are engaged in the mass production of counterfeit goods. Similarly, smuggling has gone beyond some precious articles to almost all products. These two activities have become increasingly interlinked and have taken the form of organized crime, which poses significant challenges to India’s internal security as follows:

• Terror and violence: The 1993 bomb blast in Mumbai was carried out by the groups who were earlier (the 1970s) involved in illegal activities including smuggling, piracy of Bollywood films, etc. Later they made tactical transformation from profit-minded criminal gangs into terrorist organizations with ideological goals.
  • Many such organizations shifted their base to other countries and have been known to receive the clandestine backing of countries opposed to India. The US Government has also identified many former Mumbai-based crime syndicates that provide finance and share smuggling routes with major terrorist organizations in India and worldwide.
• Illegal immigration: In 2021, the government stated in the Parliament that illegal migrants (a form of smuggling) pose a threat to national security. There are reports about some Rohingya migrants indulging in illegal activities.
• The burden on law enforcement agencies: The increased prevalence of smuggling and counterfeiting puts a heavy burden on the resource-deprived police and other law enforcement infrastructure, which exacerbates the internal law and order problem in the country.
• Boosting organized crime: The proceeds of counterfeiting and smuggling are used by criminal and terror groups to finance organized crime in the country.

Steps that have been taken by government to counter smuggling and counterfeiting:

• The Directorate of Revenue Intelligence is constituted as an apex anti-smuggling intelligence and investigating agency.
• Automation of custom clearances at the border and induction of a Risk Management System at all important points of entry.
• Training programs were conducted for Police officials of Nepal and Bangladesh to sensitize them about the smuggling/ counterfeiting of Indian currency.
• Terror Funding and Fake Currency Cell has been constituted in the National Investigation Agency to conduct a focused investigation of terror funding and fake currency cases.
• Amendments in the Unlawful Activities Act 1967 wherein damage to the monetary stability of India by production/ smuggling/ circulation of Fake Indian currency is declared as a terrorist act.

India needs to create a uniform legal structure, dedicated redressal structure and time-bound disposal of cases related to counterfeiting and smuggling. Further, there is a need for capacity enhancement for effective enforcement of a zero-tolerance policy towards these offenses.