An ongoing "trade" relation between a section of merchants in India and China is likely to cheer up those batting for restrictions in sale of Chinese goods in the country. A racket in human hair -- supplied from Indian traders to the Chinese -- is flourishing, say sources in the Enforcement Directorate. There is tax evasion at both ends and possibly in nations where the finished product is ending up, officials said.
The supplies appear to be coming from parts of Andhra Pradesh and Telangana and are routed through Kolkata and the northeast. The catalysts in this underground trade are some people from Myanmar.
The agency stumbled upon the racket while investigating money laundering by Chinese online betting applications.
Officials found a trail of hawala payments to the tune of Rs 16 crore, which they traced to merchants of human hair. The payments were routed through Paytm accounts of the parent companies of illegal Chinese apps.
The agency found that domestic merchants are collecting and selling human hair to foreign merchants based in Hyderabad, Guwahati, and Kolkata, a media release by ED said on Wednesday.
The stock is then smuggled via border points at Moreh (Manipur), Zokhawthar (Mizoram), and Aizawl (Mizoram), among others, to Mandalay in Myanmar), and from there, moved to China.
In China, the stock is allegedly getting labelled "Chinese hair" and processed -- the traders there are managing to avoid import duties of up to 28 per cent. The fake labelling is also helping them earn 8 per cent in export incentives, the agency said.
The agency suspects many Indian exporters, too, are under-valuing the material to help the recipient merchants.
It was found that two Hyderabad-based traders received Rs 3.38 crore against sales in the northeast -- via Paytm accounts of the parent companies of illegal Chinese apps.
The ED noticed that some Myanmar citizens were permanently stationed in the Telangana capital. They purchased human hair locally and exported it allegedly using the import-export codes of Indian entities.
During a search operation, the agency seized 12 cellphones, three laptops, a computer, hand-written diaries, rough account books, and incriminating documents, according to the press release. Unaccounted cash to the tune of Rs 2.9 crore was also recovered from some merchants.
A case under the Foreign Exchange Management Act has been filed against the traders, who are based in Telangana and Andhra Pradesh.
Scientists Reveal The Reason Why Your Hair Turns Grey As You Age Humans Can Still Grow A Full Coat Of Body Hair, Study Finds This Belgian NGO Is Recycling Human Hair To Protect The Environment 2 Dead, Many Feared Trapped For 17 Hours After Mohali Building Collapse Germany Refused To Extradite Saudi Suspect? Suicidal Empathy, Says Elon Musk Speeding Creta SUV Kills Boy, 4, In Mumbai, Teen Driver Arrested PM Modi To Meet Kuwaiti Crown Prince, Sign MoUs On Day 2 Of Visit: Top Points These Street Dogs in Brazil Became A National Symbol. Here's Why National Mathematics Day: Why It Is Celebrated On December 22 Track Latest News Live on NDTV.com and get news updates from India and around the world.