Trouble For People Trading Across LoC1 August 2011
The Indian Express
Jammu: Border trade between people living on both sides of the Line of Control (LoC) is in for another trouble as UPA government has decided to ban trading of goods of Indian origin by traders in Jammu and Kashmir to their counterpart in Pakistan occupied Kashmir (PoK). Official sources told The Indian Express that the new directive has come from Customs Department following a meeting of inter ministerial committees convened recently by the Union Home Ministry. The meeting, which was also attended by officers from the state government, reportedly took note of trading of goods of Indian origin to PoK through the LoC trade facilitation centres instead of those grown or manufactured locally by people in the state. A letter from Customs Department banning trading of goods of Indian origin by traders on this side of the LoC has been received by officials concerned at both Chakkan Da Bagh on the Poonch-Rawalakot road and Salamabad on the Uri-Muzaffrabad road. Referring to the evasion of customs and other taxes on account of goods sale of Indian origin to PoK through LoC, the letter pointed out that the border trade was allowed between people living on both sides of LoC as part of Confidence Building Measures (CBMs) initiated by two neighbouring countries. As goods grown or manufactured locally by people on both sides of the LoC had to be traded between them on barter system, the trade was exempted from the purview of customs and other taxes, sources pointed out. Traders from elsewhere the country, however, appeared to cross LoC to trade goods of Indian and Pakistani origin so as to evade taxes which are otherwise levied in the event of trade with the neighbouring country, they added. Substantiating, officials said ever since the beginning of the border trade between two sides, goods worth Rs 134.27 crore in Indian currency have been exported from Chakkan Da Bagh in Poonch and Rs 177.60 crore from Salamabad in Valley between October 21, 2008 to December 31, 2010. Similarly, during the same period, goods worth Rs 227,70 crore in Pakistan currency have been imported through Chakkan Da Bagh and Rs 271,42 crore through Salamabad. What had been most sought after goods between traders on both sides were, however, not those grown or manufactured in either Jammu and Kashmir or the PoK. While moong dal, herbs and garlic dominated the imports from PoK, the goods most sought after by traders across the LoC were big cardamom, coconut and red chilly. Significantly, moong dal and garlic are not grown in PoK. Similar is the case with respect to big cardamom and coconut on this side of the LoC. Though herbs and red chilly are grown on both sides of the state, their quantity is not sufficient enough to meet the demands of local as well as outside market. As a result, most of the herbs and red chilly traded between the two sides had reportedly come from outside Jammu and Kashmir and PoK. The moong dal or garlic brought from PoK was not sold in Jammu and Kashmir, but it has found its way in markets elsewhere the country. Some of the local traders, who wished to be anonymous, admitted that goods brought from PoK mostly find their way elsewhere the country. About moong dal, they pointed out that they had been getting it from PoK in raw form. In the absence of any industrial unit for its cleaning and polishing, they had to send it to the other state. It is, however, after getting it polished, they had to sell it there as it was not profitable for them to bring it back to the state for sale in the local market, they pointed out. Under the given situation, officials said traders elsewhere the country appear to have hijacked the cross LoC trade. A number of local traders who have got themselves registered with the local administration appear to be acting only as their front men so as to provide them a cover. Confirming the receipt of such a letter from Customs Department, Custodian LoC Trade at Chakkan Da Bagh, Abdul Hamid Sheikh, said they, however, allowed trading of goods of Indian origin during the last three weeks so as to enable traders exhaust their stocks. “From now onward, we will not allow trading of goods other than those grown or manufactured in the state,” he added. Sources, however, said the traders on both sides have nothing to trade between them except goods of Indian or the Paksitani origin. In this connection, they pointed out that goods of Kashmir origin like apple, carpets and handicrafts were not much in demand from traders across the LoC. Since the beginning of the trade till December 31, 2010, only 1,019 quintals of apple have been sold to PoK, they pointed out.