The loss to government: Rs 15,000 crore. The loss to industry: Rs 30,000 crore. The culprit: trade in counterfeit products. This has been indicated in a new study conducted jointly by industry chamber Assocham and law firm Inttl Advocare. The report, which is likely to be handed over to the ministry of consumer affairs next week, also suggests legislative changes to counter this.

As an industry, the biggest loser is the FMCG (fast moving consumer goods) sector, which loses Rs 8,000 crore every year, about 15 per cent of the total market size. Clothing and branded products lose Rs 4,000 crore per annum.

The extent of counterfeiting is most audible in the music industry, where half the music cassettes and CDs in the market are pirated; every day about 500,000 pirated mobile phone ring tones are downloaded in India. As consumers, perhaps the biggest loss (Rs 6,000 crore) comes from purchase of fake gold and precious metals.

But the cost of counterfeiting trade is higher than just money. About 38 per cent of medicines provided in government hospitals are counterfeit, as are more than 40 per cent of pharmaceutical products available in the market. As a result, the pharmaceutical sector suffers a loss of Rs 4,000 crore every year due to counterfeiting, says the study.

The business of fake products is not flourishing in India alone. Across the world, the counterfeiting industry generates annual sales of $600 billion. US companies lose $200 billion annually because of the presence of fake products.

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