Teak wood of Myanmar going this way in the market of US and EU, how India became a ‘leakage country’ after China
India has not stopped bringing in teak from Myanmar to sell to the US and the EU.
Teak wood from Myanmar’s dense forests makes its way to Europe and the United States via India. From Myanmar, people have bought and sold teak wood, which is thought to be the best for making furniture and luxury yachts. But India has become a major market for it as well.
How did India follow China in becoming a “leakage country”?
Myanmar is starting to like India more and more since the military coup in 2021 stopped the trade of wood from the country to the West. Based on leaked customs data from Myanmar, global trade statistics, and visits to major timber markets, an investigation by The Indian Express and the International Federation of Journalists has shown a number of things.
After China, India has become a “leakage country,” as shown by records. India, which is the second biggest buyer of teak wood from Myanmar, has not stopped bringing teak from Myanmar into the country to sell to the US and the EU. This supply of teak not only cut down on the amount of forest in the country, but it also fed the military regime.
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Myanmar’s forestry industry is hit with sanctions from the EU, US, UK, Switzerland, and Canada.
Forest Watch, a group that keeps an eye on the world, says that Indian companies bought more than $10 million worth of teak between February 2021 and April 2022. Since the coup, Forest Trends, which is based in the US, has said that about a quarter of all the wood that Myanmar has exported has gone to India.
MP Veneer and its partner companies, Akanksha Enterprises and ATEC, which are based in Bhopal and Nagpur, are the two most well-known Indian exporters. Besides this, there is Friends Timber Private Limited (FTPL), which is in Nagpur.
Many countries buy goods from Indian companies.
EU, US, UK, Switzerland, and Canada all put sanctions on Myanmar’s forestry industry, which includes the state-run Myanmar Timber Enterprise (MTE), which has exclusive rights to the country’s wood. In September 2021, the EIA looked at the companies’ finances and supply chains and said that Friends Timber was part of a huge network of European timber companies. EIA gets its supplies from MTE. The teak goes to Comilegno, Italy, through Friends Timber and then to Viator Pula, a company in Croatia.
Indian businesses that buy from Myanmar
The Dutch newspaper NRC got customs data that backs up this link. This shows that Friends Timber recently sent teak from Myanmar to a number of companies in the EU. These deals will last until October 2022. When The Indian Express went to the Kapsi Khurd neighborhood of Nagpur to see Friends Timber, its sawmills and warehouses were full of teak from Tanzania and Myanmar.
Sameer Jaiswal and Puneet Kohli, who run the company, said that more than 60% of their current stock, which is more than 80,000 metric tons of teak, came from Myanmar. But he said that the money had already been paid for this before the military coup in Myanmar in 2021, and that some of the shipments are still coming.
Crossing the Border: Trade and Smuggling
Things are very bad for Indian teak traders in Yangon, which is just across the border. The Indian Express once talked to one of the best manufacturing firms in the country. Since 1996, he has been working in Myanmar. He says that between 60 and 70 Indian teak factories and sawmills have closed. Some are on fire. He said, “Right now, most teak is exported by third-party Indian traders, and a lot of teak is illegally sent across the border between China and India.” Along the Indian borders of Nagaland, Mizoram, and Assam, this is happening.”
