Here is why trade along LoC with Pakistan was suspended by India

New Delhi, Apr 18: Citing misuse India on Friday suspended trade along the Line of Control (LoC) with effect from April 19. The action was taken after it was reported that Pakistan based elements were using the trade route to smuggle weapons, fake currency and narcotics.

The Home Ministry said that a stricter regulatory and enforcement mechanism is being worked and the issue of the reopening the trade routes will be revisited once they are implemented.

The Union Home Ministry order stated that it has been "decided by the Government of India to suspend the LoC trade at Salamabad and Chakkan-da-Bagh in Jammu and Kashmir".

The LoC trade, at present, is conducted through two trade facilitation centres located at Salamabad in Uri of Baramulla district, and Chakkan-da-Bagh in Poonch district.

This trade takes place four days a week and is based on barter system and zero-duty.

The measure has been taken in the backdrop of the Pulwama terror attack following which India stepped up its military and strategic offensive against Pakistan and also withdrew the most favoured nation (MFN) from its neighbour.

"Meanwhile, a stricter regulatory and enforcement mechanism is being worked out and will be put in place in consultation with various agencies. The issue of reopening of LoC trade will be revisited thereafter," the government said in the statement.

The decision has been taken after reports of "cross Line of Control trade routes being misused by Pakistan based elements for funneling illegal weapons, narcotics and fake currency etc", a statement by the Home Ministry read.

"During ongoing probe of certain cases by NIA, it has been brought out that significant number of trading concerns engaged in LoC trade are operated by persons closely associated with banned terror organisations involved in fueling terrorism/separatism," the statement also read.

It was found that cross-border traders had been tapped by terror groups to help raise funds for terror activities in J&K.

The NIA had found that a food item would be imported from Pakistan at a very low price and then sold at double the amount in India. For instance, Californian almonds would be imported by the trader at Rs 350 a kilogram and then sold at Rs 700 in the Indian market. The profit investigators say would be used to fund terror.

There is a select network of traders that the terror groups have tapped into to further their agenda. These traders work under terror groups such as the Hizbul Mujahideen and the Lashkar-e-Tayiba, an NIA official informed.

The NIA has also found a list of 21 items that are being imported by traders from Pakistan at a very low cost. Out of this the highest profit margin is for the California almond which sells at double the cost in India, the NIA official also informed.