Hot Off The PressNews

Ministry of Home Affairs has issued orders to suspend the LoC trade in Jammu & Kashmir w.e.f 19-04-2019. This action has been taken as the Government of India has been receiving reports that the Cross LoC trade routes are being misused by the Pakistan based elements for funneling illegal weapons, narcotics and fake currency, etc.

It may be recalled that the LoC trade is meant to facilitate the exchange of goods of common use between local populations across the LoC in Jammu & Kashmir. The trade is allowed through two Trade Facilitation Centres located at Salamabad, Uri, District Baramulla and Chakkan-da-Bagh, District Poonch. The trade takes place four days a week. Trade is based on the Barter system and zero duty basis.

However, reports have been received that the LoC trade is being misused on a very large scale. It has been revealed that the trade has changed its character to mostly third party trade and products from other regions, including foreign countries, are finding their way through this route. Unscrupulous and anti-national elements are using the route as a conduit for Hawala money, drugs and weapons, under the garb of this trade.

During the ongoing investigations of certain cases by NIA, it has been brought out that a significant number of trading concerns engaged in LoC trade are being operated by persons closely associated with banned terrorist organizations involved in fuelling terrorism/separatism. Investigations have further revealed that some individuals, who have crossed over to Pakistan and joined militant organizations have opened trading firms in Pakistan. These trading firms are under the control of militant organizations and are engaged in LoC trade.

After the Pulwama incident, the Government of India has withdrawn the MFN status to Pakistan. Inputs have also been received that in order to evade the consequent higher duty, LoC trade is likely to be misused to a much larger extent.

It has, therefore, been decided by the Government of India to suspend the LoC trade at Salamabad and Chakkan-da-Bagh in Jammu and Kashmir with immediate effect. Meanwhile, a stricter regulatory & enforcement mechanism is being worked out and will be put in place in consultation with various agencies. The issue of reopening of LoC trade will be revisited thereafter.


[Dated: 18-04-2019]

Ministry of Home Affairs

NewsTreaties/Conventions/International Agreements

The Union Cabinet has approved the signing of a Memorandum of Understanding (MoU) between India and Turkey on trade in poppy seeds to ensure quick and transparent processing for import of poppy seeds from Turkey.

Details:

The MoU provides that

  1. Turkish Grain Board (TMO) shall maintain an online system to enable regulation of export of poppy seeds from Turkey to India. Exporting companies shall submit application through the Agean Exporters Association (EIB) (responsibility given by law) to TMO for obtaining membership of the online System.
  2. Each year, the quantity of poppy seeds which shall be imported by India from Turkey shall be decided by Government of India in consultation with Government of Turkey taking into account the production of poppy seeds in Turkey in a crop year, balance from previous crop years and domestic or other export requirement of Republic of Turkey.
  3. The exporting companies shall get registered with the TMO. Each sales contract entered into by the exporting company with Indian importer shall be registered with TMO through the online system referred. It shall be the responsibility of TMO not to register sales contract in excess of the quantity referred to in Para 2 above.
  4. Taking into account the quantity as referred to in Para 2 above, every year both parties may consider to set a quantity to be imported by any Indian importer in a crop year.
  5. The Central Bureau of Narcotics (CBN) will register the sales contract registered by TMO as per details accessed on the online system maintained by TMO in accordance with guidelines for registration laid down by Ministry of Finance, Government of India. The CBN shall upload the details of sales contract so registered by it on the online system. TMO shall allow the export in respect of only those contracts so registered by CBN.
  6. The TMO shall provide a legal production certificate for the poppy seeds to exporters following the submission of sales contract and the completion of other necessary procedures.

The MoU will promote quick and transparent processing of quota allocation and prior authorization for poppy seeds import from Turkey. In this way genuiness of import contract can be easily ensured as well as many litigation matter resulting in delay in the import can be avoided. The MoU will ensure continuous availability of poppy seeds in domestic market of India and ultimately Indian consumers of poppy seeds will be benefited.

Background:

Import of poppy seeds from Turkey got withheld due to litigation resulting in great hike of price of poppy seeds in domestic market of India and hoarding of the same by some importers. Various stays given by the Court and repeated adjournment of hearing graves the situation and resulted in less availability of poppy seeds in the country leading to a great problems to the consumers. To avoid such legal complication, price rise and hoarding, an alternative mechanism needs to be evolved by way of an MoU between Government of India and Government of Turkey in which real time data can be exchanged to ensure the quantity of poppy seeds imported from Turkey is genuine and legally produced in Turkey.

Cabinet