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Suspension of LoC trade in Jammu and Kashmir
Why is it in news?
- The Ministry of Home Affairs (MHA) suspended the cross-Line of Control (LoC) trade in Jammu and Kashmir, citing “funnelling of illegal weapons, narcotics and fake currency” as reasons.
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- Impact of decision: It will immediately impact around 300 traders, and more than 1,200 people who are directly and indirectly associated with the trade on this side.
- What MHA order says?(1) 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.(2) Unscrupulous and anti-national elements are using the route as a conduit for hawala money, drugs and weapons, under the garb of this trade.(3) A probe by the National Investigation Agency (NIA) suggested that a significant number of concerns engaged in the trade are being operated by persons closely associated with banned terrorist organisations.
- Misuse of LoC trade after MFN status waiver: It also pointed out that the government of India after the Pulwama attack withdrew the Most Favoured Nation status to Pakistan and inputs suggested that in order to evade the consequent higher duty, the LoC trade was likely to be misused to a much larger extent.
- Cross-LoC trade:(1) In a major confidence building measure, cross-LoC trade was started in 2008 by setting up two Trade Facilitation Centres located at Uri’s Salamabad in Baramulla, and Chakkan-da-Bagh in Poonch.(2) The trade took place four days a week.(3) It was based on barter system and zero duty basis.
Source
The Hindu