₹50,000 crore sent to China via hawala: ED cracks down on Indian companies

The Enforcement Directorate (ED) is intensifying its investigation into allegations of money laundering involving companies importing goods from China, officials told Business Today TV.

Several Indian companies are suspected of violating laws by undercharging luxury products such as furniture and appliances imported from China.

The practice helps these companies evade taxes, with the remaining payment being routed to Chinese sellers through hawala networks, officials claimed.

The Ministry of Finance, Foreign Affairs and Home Affairs coordinated closely with the ED in the investigation.

Officials claim that in the last six months alone, Indian companies have allegedly diverted Rs 50,000 crore to Chinese sellers through this under-invoicing tactic. These companies are believed to have violated both anti-money laundering and foreign exchange regulations.

The ED has launched a formal investigation under the Prevention of Money Laundering Act (PMLA) and is probing how the remaining funds are being diverted to China. The agency is also investigating the use of cryptocurrencies in these transactions, as many payments are reportedly made through digital currencies.

Sources suggest the crackdown is part of a broader government effort to curb illicit financial flows and strengthen the country’s economic security. The ED’s investigation is expected to expand as the agency pursues suspected misuse of funds and further evaluates financial activities linked to Chinese imports.