Centre working on new plan to deter counterfeit products

Nearly 1.6 million domestic jobs were lost in these five industries—textiles, readymade garments, tobacco products, capital goods and consumer durables. (Photo: Reuters)
Nearly 1.6 million domestic jobs were lost in these five industries—textiles, readymade garments, tobacco products, capital goods and consumer durables. (Photo: Reuters)

Summary

  • The surveillance system will ensure that every product sold meets its licence standards

NEW DELHI : The Centre is planning to create a new system to identify and contain the flood of counterfeit goods in the retail market, two people aware of the development said.

The surveillance system will ensure that every good sold in the retail market meets the standards for which a licence was issued, and also that only authorized products are manufactured, the people added.

If deviations are noticed, manufacturers’ licences may be cancelled, and they may also have to pay hefty penalties.

The ministry of consumer affairs is revisiting its conventional sample collection mechanism by engaging scientists from the Bureau of Indian Standards (BIS) and developing a methodology that can identify counterfeit goods within a fixed time-frame, the first person mentioned above said. 

BIS, a certification arm of the consumer affairs ministry, will be augmented to accomplish this task.

Samples will be collected soon after they get offloaded to the retail market from warehouses or manufacturing units. Multiple samples will be collected by a team of officials comprising BIS scientists, Centre and state government officials of different line-ministries and markets across the country. Quality reports of the collected samples will be made available to firms, and the concerned licencing authority or line ministry within a stipulated time frame.

The second person cited above said the number of testing labs would be increased, and more experts hired for sample collection and testing. “The objective of this work plan is to ensure a counterfeit-free market for our consumers," the person added.

Additionally, testing labs, including government and portable labs, and lab personnel will be strengthened. 

Queries sent to the secretary and spokesperson of the consumer affairs ministry, and the director-general and spokesperson of the BIS remained unanswered at press time.

In the current set-up, manufacturers obtain a licence to make a product. However, licensing agencies such as BIS and FSSAI lack a proper system to check whether the manufacturer is producing just those goods for which it has a licence or has begun making unlicenced products as well.

“I belief that through collective engagement, sensitization and deployment of technological advancements, we will be able to effectively counter this invisible enemy," Anil Rajput, chairman of Ficci Cascade (the committee against smuggling and counterfeiting activities destroying economy) said.

Illicit trade, which includes smuggling and counterfeiting, has a “wide-ranging and disturbing" impact on both the domestic and global society and economy, Rajput added.

A recent Ficci report placed the global economic and social cost due to counterfeit products at $2.2 trillion in 2022, which accounts for a massive 3% of the world's GDP.

A Ficci Cascade study from 2022 reveals a 163% increase in tax losses for the Indian government over a period of 10 years, amounting to 58,521 crore across five key industries, from this scourge. Additionally, nearly 1.6 million domestic jobs were lost in these five industries–textiles, readymade garments, tobacco products, capital goods and consumer durables.

 

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