Spurious/Fake Products: An Abuse to Indian Markets

Abstract

Posting of record annual sales of fake products at Rs. 15,000 crore this year, the revenue loss to the country by way of evasion of excise and local taxes by these fake products are estimated at Rs 1250 crore in March 2006 as per the study conducted by the Associated Chambers of Commerce and Industry of India (ASSOCHAM). Indian Economy has undergone a number of changes in the last decade due to liberalization and globalization. India, being a developing country has a bright future because of high growth rate and all round development of its goods and service industries. This exponential growth has also brought some negative effects of counterfeiting, adulteration and spurious products and these days it has become an increasingly dangerous menace to consumer choices, health and the economy. Consumers are often unaware that they buy products that resemble what they want. This is worrying companies because fake products often ride on the success of the original product, eating into sales, and, in some cases, harming the consumer health and safety, but there are many products which a consumer willingly purchases with
knowing that they are purchasing fake or duplicate product such as VCD and MP3 Discs only because of lower price. The major victims of these products are customers, companies and government. The paper is an attempt to understand the business of fake products, its existence in market and reasons for its existence and the most important the steps taken by the government and companies to prevent the uses of these products. The paper also aims to suggest strategies to curb these products to circulate in the market.