Consumption of products increases demand and supply, leading to rise in price and a fall in quality. This situation creates numerous illegal markets, forms illegal factories to produce fake products to meet the demand of consumption at low cost. Bihar is considered as one of the largest markets for producing illegal cigarettes, in India. It holds about 20% share of the entire market. Every month, more than 40 million cigarette sticks are illegally sold in Bihar. It has resulted to annual loss of about Rs 75 crore, to the state.
Federation of Indian Chambers of Commerce and Industry (FICCI) organized a seminar along with the Committee Against Smuggling and Counterfeiting Activities Destroying the Economy (FICCI-CASCADE), focusing on seven prominent industries that includes alcohol, tobacco, auto components, computer hardware, mobile phones and FMCG (personal care goods and packaged foods). The seminar was chaired by the advisor of FICCI, Mr. Deep Chand. He said that Indian Government has suffered from a loss of Rs 26,190 crore, in the year 2012 because of fake products. He added that in-spite of the loss to the Indian Government in terms of fake medicines; the health, hygiene and well-being of the consumers, also get affected.
PC Jha, another advisor of FICCI, made a statement that adequate taxation policy should be developed by policymakers for the benefit of government, trades and consumers. It is obvious that expensive goods would only lead to imitation and smuggling and VAT rates cannot put restrictions on the consumers from consuming products like alcohol and tobacco. According to Sushil Kumar Modi, Deputy CM and Finance Minister, 30 per cent of India’s Economy is managed on black money. Therefore, he suggested the use of technology, to put a check on such practice that encourages black money. He recommended the use of technology to restrict the small shopkeepers, not issuing bills.
The Chairman of FICCI-CASCADE, Anil Rajput said that awareness is the beginning of change and assured that FICCI-CASCADE would put efforts in creating awareness in consumers, with the help of campaigns, throughout the nation. Numerous security systems like hologram, barcode, etc. are created for safety reasons and for identifying the genuine products but the manufacturer are unaware or not at all interested about them. To know the authenticity of any product, users can call at the toll free number mentioned on the container, cover or wrapper of any product or can even SMS the bar code at the toll free number. This could prevent the usage of fake products to a great extent.
India is a chief source of fake trade and a victim as well. Delhi is reckoned as a hub of such trade and businesses. The Indian film industry faces a loss of Rs 2,000 Crore every year, due to piracy. The panel has therefore, decided to take measures such as correct policy on taxation and other issues to stop the disaster efficiently.