The Enforcement Directorate has uncovered a suspected drug payment network using everyday goods to settle dues with Myanmar suppliers.
How Were Drug Suppliers Paid Through Goods?
The Enforcement Directorate (ED) has identified an alleged payment arrangement in which drug syndicates operating in India purchase commercially marketable goods and transport them across the Myanmar border to settle payments with narcotics suppliers.
According to officials, the goods include petrol, diesel, wheat flour, edible oil, groceries, medicines, footwear and clothing. Instead of transferring money directly to Myanmar, syndicate members allegedly convert proceeds from drug sales into these products.
The findings emerged during investigations following the October 23 multi-agency crackdown, codenamed Operation Trident, involving searches at 38 locations across Assam, Mizoram and Manipur.
The operation involved the ED, Narcotics Control Bureau and Mizoram Police. Authorities reported uncovering ₹100 crore in hawala transactions, freezing 1,424 bank accounts, attaching properties worth ₹22 crore, seizing 500 detonators and ₹12 lakh in cash, and arresting 18 people.
How Did the Five-Stage Payment System Work?
Investigators described a five-stage process through which drug proceeds were allegedly converted into goods before reaching Myanmar.
First, drugs sourced from Myanmar were sold for cash in Churachandpur, Champhai and other towns in Manipur and Mizoram. Syndicate operatives collected the proceeds and handed them to cash handlers or deposited them into accounts provided by hawala operators.
The money was subsequently introduced into the banking system through mini-ATM or customer service provider counters in Churachandpur, or through mule accounts in Mizoram. Officials said these transactions were conducted on instructions from Myanmar-based money exchangers.
Funds were then transferred through RTGS, NEFT or IMPC, as described by investigators, to legitimate suppliers such as petrol pumps, flour mills, grocery wholesalers, medicine distributors and clothing traders across several Indian states.
In the fourth stage, suppliers allegedly issued GST invoices and e-way bills naming different buyers, often traders in Mizoram’s border towns. The goods were delivered to these locations before being transported into Myanmar.
Finally, the products were sold in Myanmar for kyat, and the proceeds were used to settle outstanding payments to drug suppliers.
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What Did Investigators Find About the Banking Transactions?
Officials said the arrangement allowed transactions within India to resemble ordinary commercial payments supported by invoices and transport documents. The cross-border settlement, however, allegedly occurred through physical goods rather than financial transfers, making the payment trail more difficult to follow.
The ED had previously disclosed that one company made 2,947 transfers worth ₹175.03 crore between 2024 and 2026 to mule accounts in Mizoram. Those transactions were allegedly settled through unlicensed rupee-kyat exchangers in Champhai.
Investigators believe the newly identified goods-based arrangement represents a separate channel that can bypass such currency exchanges.
What Is the ED Investigating Next?
The agency is continuing efforts to identify individuals receiving consignments in border towns, those responsible for transporting goods into Myanmar and the Myanmar-based recipients.
Investigators are also examining additional petrol pumps, traders and suppliers suspected of receiving similar payments, along with money exchangers directing the accounts involved. The ED intends to trace and attach further suspected proceeds of crime as the investigation progresses.
The420 Insight: The findings indicate that suspected drug proceeds may be concealed within legitimate-looking domestic trade transactions. The investigation highlights the difficulty of tracing cross-border criminal payments when money is converted into goods before reaching overseas recipients.
