Indian trade body forms committee to tackle 'rampant' illicit trade

The Federation of Indian Chambers of Commerce and Industry (FICCI) has created a Committee on Anti Smuggling & Counterfeiting "in a bid to counter the menace of illicit trade."

Describing the rise in this kind of trade as "rampant," the FICCI maintains that illicit trade in medicines is around 15 to 20 per cent of the total market, presenting "a serious hazard to the health of ordinary citizens."

That view contradicts the findings of a sampling study carried out in 2009 by the Central Drug Standard Control Organisation (CDSCO) which found that the rate of counterfeit and substandard medicines was just 0.04 per cent.

"Smuggling and trade in counterfeit goods poses a serious threat to the manufacturing sector, stifles innovation, and leads to loss of tax revenue, and employment," said the FICCI in a statement.

The committee's remit extends well beyond pharmaceuticals though and will also tackle issues affecting fast-moving consumer goods (with an estimated counterfeit rate of 8 to 10 per cent), cosmetics (10-30 per cent), IT/software (80 per cent), music (40 per cent) and auto components (37 per cent).

The committee - full name Committee of Anti-Smuggling & Counterfeiting Activities Destroying the Economy (CASCADE) - will be co-chaired by Anil Rajput, senior vice president for corporate affairs at FMCG firm ITC Ltd, and Tata Motors' vice president of legal Rajesh Bagga. Its main areas of activity will include the development of best practices for industry to counter counterfeiting and smuggling, running educational workshops and pushing for greater enforcement capacity.

The aim is for the committee to work closely with the Government in policy and regulatory matters so that illicit trade "can be eradicated altogether," said the FICCI.

"The need of the hour is for industry to come together with the support and vision of the Government and formulate strategies to launch a multi-pronged attack to address the menace of smuggling and counterfeiting in a holistic manner," said Rajput.

News of the committee's formation comes shortly after India's announcement of an ambitious plan to require all exported medicines to carry barcodes with item-level serialisation by July 1 (see India sets challenging timeframe for barcoding drug exports).