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Smuggling in India Report 2024-25 6

Foreign Currency

The smuggling of foreign currency from India poses a serious threat to financial
integrity, economic stability and national security, undermining the integrity of
the financial system and depleting the nation’s foreign exchange reserves. Orga-
nized syndicates exploit trade channels, passengers, and courier networks to illic-
itly move foreign currencies abroad, often linked to hawala, money laundering,
and terror financing networks. DRI and Customs have uncovered numerous cases
involving concealment of foreign currencies in baggage and cargo shipments
exposing the sophistication and scale of illicit outflows. There is a growing need to
strengthen surveillance mechanisms, intelligence-based targeting, and
inter-agency collaboration, coupled with strict enforcement under the Foreign
Exchange Management Act (FEMA), 1999 and the Customs Act, 1962 to effective-
ly dismantle the shadow economy.

Case 5: Passengers bound for Dubai caught with foreign currency

In December 2024, DRI officers intercepted four passengers scheduled to
travel to Dubai for attempting to smuggle foreign currency out of India.
Scanning revealed concealed items in the false bottoms of their baggage.
On examination, foreign currency worth ₹1.67 crore was recovered.

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