Gold is out, fake currency is in

The gold smuggling ring that went out of activity post-liberalisation is into something new. Revenue intelligence agencies are tracking down some key gold smugglers for assisting Pakistan’s Inter Services Intelligence (ISI) smuggle in fake Indian currency.

“There is credible evidence to suggest that the network is being used to smuggle fake Indian currency notes (FICN) now,” a senior intelligence official said. ISI is pursuing this on a massive scale, he said.

Gold smuggling was a lucrative trade in the pre-liberalisation era. But it slowly fizzled out after 1991.

That was the time when Dawood reportedly joined hands with the ISI and provided them his network for their anti-India activities. The ISI is now reportedly using Dawood’s network to pump in crores of fake Indian currency through various routes.
The Indo-Nepal route, one of the most efficient routes for smuggling, is handled by D-company member Aftab Batki.

Intelligence agencies have identified specific areas in Quetta and Sindh (in Pakistan) where fake Indian currency is printed. The operation is led by Taiyyab, whose whereabouts are unknown. What is worrisome is that ISI has managed to get currency paper from the same firm in UK that sells it to India.

A recent intelligence bureau (IB) report says multiple entry points are being used to pump in fake currency — the most susceptible being the Indo-Nepal, Indo-Bangladesh, Indo-Pakistan borders, the Colombo route through Chennai and other southern port cities, through international airports and the Samjhauta Express.

Haji Anees, an old time gold smuggler, was arrested last year from Delhi with Rs3 lakh in fake currency. He had been arrested in 1983 while smuggling gold through IGI airport.

Last year, the DRI (directorate of revenue intelligence) arrested another man from the Indo-Pakistan border. He belonged to a family of gold smugglers, his father Labh Singh being a well-known smuggler.

The presence of fake Indian currency in the market has assumed scary proportions. The Reserve Bank of India (RBI) pointed out a 137% increase in counterfeit currency notes in its branches last year (2007-08).

And there was clear shift towards notes of higher denomination, like Rs100, 500 and 1000.

An IB assessment says an astonishing Rs169,000 crore fake currency could be in circulation. The RBI vehemently denies the assessment, but no one has come up with a different figure.

Seizures across India in the last few years point to huge presence of FICN in Bangalore, Hyderabad and Kerala.