The Angadia System: A Century-Old Trust-Based Courier Service in India
The Angadia system is a centuries-old, informal, and trust-based courier service that has been a cornerstone of trade and commerce in India, particularly in the states of Gujarat and Maharashtra. This system, which involves the secure transportation of valuable goods such as cash, diamonds, and jewellery, has been in operation for over a century and continues to play a vital role in the country's economic landscape.
Background Information
Origins and Evolution
The Angadia system originated in the Mehsana district of Gujarat and was pioneered by the Patel community. Over time, it expanded to include other communities such as the Marwaris from Rajasthan. This system became particularly important during the British era when cotton from Gujarat was exported to Manchester and then returned to Mumbai mills, necessitating reliable and instant money transfer services for farmers across Gujarat[2].
Operations
Angadias operate on a strong foundation of trust and close-knit relationships. Clients entrust their valuables to Angadia couriers, who meticulously handle and transport the goods with the highest level of security. These couriers are known for their discretion, professionalism, and dedication to delivering the entrusted items safely and promptly. The system works completely on trust, with traders often using the same Angadias for decades together[4].
Key Statistics and Data
Volume of Transactions
It is estimated that Angadias handle several hundred crore rupees worth of goods and cash in their operations. The combined value of goods and cash transported by Angadias annually ranges between ₹70,000 crore and ₹1 trillion. Approximately 200 Angadias operate in Mumbai, while an additional 200 can be found in cities like Ahmedabad, Rajkot, Surat, and Baroda[1].
Security Measures
To ensure security, Angadias often travel in groups and use public transport, such as trains, to maintain a low profile. For example, they frequently use the Gujarat Mail, with 30 to 50 percent of the seats in two coaches reserved by Angadias. They keep a low profile, preferring to wear normal clothes to avoid suspicion[3].
Robbery Incidents and Security Concerns
Recent Cases
There have been several instances of Angadia robberies in the past, highlighting the vulnerabilities of this system. A recent case in Ahmedabad involved the theft of ₹1.5 crore, where the complainant himself was found to be involved in the robbery, indicating internal collusion as a significant risk. Such incidents underscore the need for stricter internal controls within Angadia firms[1].
Historical Context
Previous cases have shown that Angadia robberies can involve large sums of money. For instance, in 2016, ₹1.5 crore was recovered from five individuals arrested in connection with another Angadia robbery. These incidents highlight the economic significance and the potential risks associated with the Angadia system[3].
Expert Opinions and Quotes
Trust-Based System
Anonymously quoted proprietors of Angadia firms emphasize that the business is built on trust:
"We have built our business purely on trust; something diamond merchants would vouch for. People who transfer cash prefer us. We take risks and our charges are reasonable. In fact, businessmen have relied and continue to rely on us," said an Angadia, speaking to Deccan Herald on condition of anonymity[3].
Security Concerns
Experts have highlighted that the e-way bill system, while intended to combat tax evasion, increases the risk of robbery as it makes the details of valuable consignments susceptible to hacking and misuse:
"The e-way bill system, while aimed at reducing tax evasion, creates a digital trail that can be exploited by criminals, thereby increasing the risk of robbery," noted an expert in the field[4].
Regulatory Environment and Challenges
GST Compliance
The implementation of the Goods and Services Tax (GST) has led to increased scrutiny of Angadias, with crackdowns on firms suspected of tax evasion. This has resulted in Angadias being more cautious about accepting goods from traders without GST registration. Angadias now need to generate e-way bills for goods valued over ₹50,000, a measure aimed at reducing tax evasion but also increasing the risk of robbery due to the digital trail of valuable goods[4].
E-Way Bill Controversy
The introduction of the e-way bill system has been controversial, with diamond traders and Angadias expressing concerns about the safety and security of their consignments. The digital trail created by the e-way bill system makes it easier for potential thieves to track valuable goods, thus increasing the risk of robbery[4].
Industry Impact
Diamond Industry
The diamond industry, which heavily relies on Angadias for transporting valuable stones and jewellery, has been significantly impacted. The fear of robbery and the need for compliance with GST regulations have led to changes in how Angadias operate, including refusing to deliver goods from unregistered traders. This has created a ripple effect, impacting the efficiency and reliability of the diamond trade[4].
Trust Erosion
Incidents of robbery, especially those involving internal collusion, can erode the trust that is foundational to the Angadia system. This could lead to a decline in the use of Angadias and a shift towards more formal, regulated courier services. Trust is the backbone of the Angadia system, and any breach of this trust can have far-reaching consequences[1].
Economic Losses
The recovery of ₹1.5 crore from the recent robbery highlights the economic significance of these incidents. Such losses can be substantial and impact both the Angadia firms and the industries that rely on them. The economic stability of these firms and the broader economy can be compromised by these robberies[3].
Future Implications
Regulatory Adjustments
There may be a need for regulatory adjustments to balance the need for tax compliance with the security concerns of Angadias. This could involve more secure methods of generating and storing e-way bills, such as encrypted data storage and transmission. Regulatory bodies need to find a balance that ensures compliance without compromising the security of valuable goods[4].
Technological Solutions
Implementing more secure technological solutions could help mitigate the risks associated with the e-way bill system. For instance, using blockchain technology to create an immutable and secure record of transactions could reduce the risk of hacking and misuse. Technological advancements can play a crucial role in enhancing the security and efficiency of the Angadia system[4].
Internal Controls
Angadia firms may need to strengthen their internal controls to prevent internal collusion and ensure that their operations are more transparent and secure. This could involve regular audits, background checks on employees, and the implementation of strict protocols for handling valuable goods. Strong internal controls are essential for maintaining the trust and integrity of the Angadia system[1].
Alternative Services
The industry might see a rise in the use of formal, regulated courier services that offer better security and compliance with regulatory requirements, potentially reducing the reliance on Angadias. However, the unique trust-based nature of the Angadia system makes it difficult to replace entirely. Formal services may not offer the same level of trust and personal connection that Angadias provide, which is crucial for many traders[4].
Conclusion
The Angadia system is a testament to the power of trust and community in facilitating economic transactions. Despite the challenges posed by regulatory changes and security concerns, the Angadia system continues to thrive in certain sectors and regions where the need for secure and confidential financial services remains high. To ensure the long-term viability of this system, it is crucial to address the regulatory and security challenges through a combination of technological solutions, stronger internal controls, and balanced regulatory adjustments.
In the words of an Angadia:
"We have built our business purely on trust... People who transfer cash prefer us. We take risks and our charges are reasonable. In fact, businessmen have relied and continue to rely on us,"[3].
This trust, built over centuries, is the foundation upon which the Angadia system stands. Preserving and enhancing this trust will be key to the continued success and relevance of this unique and vital part of India's economic fabric.
