Trading of 21 items like red chili, mangoes, herbs and dry fruits will be hit following the indefinite suspension of cross LoC trade in Jammu and Kashmir, officials said Friday.
Around 280 traders, who were directly involved in the trading will also be affected after the suspension of the business, which has touched Rs 6,900 crore since its inception in 2008.
The 21 items listed for the cross LoC trade include bananas, embroidery items, tamarind, red chili and cumin for exports while imports mainly were almonds, dry dates, dry fruits, herbs, mangoes and pistachio.
Hardening its stand against Pakistan, India Thursday indefinitely suspended cross-LoC trade at two points along the Line of Control in Jammu and Kashmir effective Friday, following reports that it was being "misused" by elements from across the border to smuggle weapons, narcotics and fake currency.
The Home Ministry said orders have been issued for halting the trade at Salamabad of Baramulla in Kashmir region, and Chakkan-da-Bagh of Poonch district in Jammu region, after reports of very large scale "misuse" of cross-LoC trade.
The cross-LoC trade on Srinagar-Muzaffarabad and Poonch-Rawalakote routes was started on October 21, 2008 as a Confidence Building Measure (CBM).
Trade since 2008 till the 2017 fiscal stood at over Rs 4,400 crore at the Uri trading centre, while the figure for the same period at Poonch stood ar Rs 2,542 crore.
Initially, 646 businessmen from Jammu and Kashmir had registered for trading in the two crossing points, but the number now stands at around 280, who are actually involved in conducting the business.
When the cross LoC trade started, initially the business was for two days but from October 15, 2011, trading days were extended to four.
The home ministry said 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. "It has been revealed that 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.
"Unscrupulous and anti-national elements are using the route as a conduit for Hawala money, drugs and weapons, under the garb of this trade," it claimed.
It said during ongoing investigations of certain cases, the NIA has found a significant number of trading concerns engaged in the LoC trade are being operated by persons closely associated with banned terrorist outfits.
"Investigations have further revealed that some individuals, who have crossed over to Pakistan, and joined militant organisations have opened trading firms in Pakistan. These trading firms are under the control of militant organizations and are engaged in LoC trade," it said.