India Seizes Suspected Dual-Use Equipment Enroute to Pakistan

Dual-Use Equipment Seizure

On March 2nd, Indian news outlets reported that Indian authorities intercepted and seized suspected dual-use equipment bound for Pakistan in late January. Indian customs officials initially boarded and inspected the cargo of the Malta-flagged vessel, CMA CGM Attila, during its stop at the Nhava Sheva port located in the city of Navi Mumbai. The officials boarded the vessel due to noticing discrepancies with the consignment’s suspected Bill of Lading (BOL) during regular inspections of the vessel’s cargo.

Billing of Ladings for CNC Machine shipment, authentic bill on left, fraudulent bill on right (X, formally Twitter/@sidhant)

Specifically, the BOL said the consigner was a Chinese company, Shanghai JXE Global Logistics Co. Ltd., while the bill identified the consignee as Sialkot-based Pakistan Wings Pvt. Ltd. However, the officials found another BOL that identified the actual consigner as Taiyuan Mining Import and Export Co. Ltd. and the actual recipient as Cosmos Engineering, based in the city of Karachi, Pakistan. The equipment that was outlined on the fraudulent BOL was identified as an Italian-manufactured CNC machine that weighed approximately 24 tons (22 metric tons) that had military and civilian uses.

CNC machine seized by Indian authorities in Nhava Sheva port, Navi Mumbai (Photo: WIONews/Sidhant Sibal)

A team from the Defence Research & Development Organisation (DRDO) also inspected the machine and determined that the machine likely does have dual-use functions. Indian officials then seized the cargo because the CNC machine violated the Wassenaar Arrangement on the regulation of the export of dual-use equipment and technologies.

China’s and Pakistan’s Reaction

China reacted to the news articles by releasing a statement through Wang Xiaojian, China’s Embassy in India’s spokesperson, X’s, formally known as Twitter, account. Wang said the “Embassy noted relevant reports and is verifying its authenticity” but also said that China strictly fulfills “its international non-proliferation obligations and commitments.” The statement also pointed out how several Indian newspapers “hyped up” a March 2020 incident when Indian officials seized an autoclave from the Hong Kong-flagged vessel, the Da Cui Yun. However, Wang said that the Embassy learned that the equipment seized was not “a piece of military equipment or a dual-use item covered by China’s non-proliferation export control regime.”

A spokesperson for Pakistan’s Foreign Ministry also released a statement on March 2nd that denied the media reports made by Indian outlets. The statement said that the reports “are reflective of Indian media’s habitual misrepresentation of facts.” The statement then says that a Karachi-based company that produces parts for Pakistan’s automobile industry imported the CNC machine. The Foreign Ministry also said that the machine’s specifications indicated that the company would only use it for commercial purposes.

Furthermore, the spokesperson also pointed out that the transaction was conducted “through transparent banking channels with all the relevant documentation.” However, the spokesperson said that the country condemned India’s “high-handedness in seizure of commercial goods.” The statement also pointed out that the disruption illustrates the “dangers inherent” and the “growing impunity of certain states in violating international norms” in states with “dubious credentials” assuming policing roles.

Pakistan’s Foreign Ministry statement denying media reports about India seizing dual-use equipment destined for Pakistan (Photo: X, formally known as Twitter/@sidhant)

Analysis

India seized the CNC machine because the recipient on the legitimate BOL, Cosmos Engineering, is a supplier for the Pakistani military. The officials also seized the shipment for other reasons, such as the container being purposely stacked to avoid scrutiny by customs officials. The country likely used Pakistan Wings Pvt. Ltd. as an intermediary in an attempt to further cover its tracks regarding the company the equipment will ultimately go to. However, Pakistan likely used the company to circumvent dual-use laws to buy the CNC machine for use in its missile and nuclear weapons programs. The country became aware of the company in March 2022, when officials also seized a shipment of thermoelectric instruments at the same port destined for Cosmos Engineering.

Once the CNC machine arrived in port, however, the company could have offloaded and sent the machine to any of a number of companies that play a direct role in the programs. One company is Quantum Logix (Pvt) Ltd., an entity that is known to play a significant role in the country’s ballistic missile and nuclear weapons development programs. The United States placed the company on its Department of Commerce’s Export Administration Regulations in June 2023 because of its links to the program but also due to concerns it would receive dual-use equipment. Furthermore, Quantum Logix and Pakistan Wings are likely connected since Quantum uses the company to transport equipment and other logistical purposes.

However, China’s and Pakistan’s denials about the allegations made by the Indian press illustrate that both countries are attempting to deflect blame from them through various means. For example, China is pointing out the February 2020 incident in the context of Indian media hyping up a seemingly benign issue. China hopes to deflect scrutiny from both it and Pakistan by pointing out that the news outlets are ‘hyping up’ the issue rather than providing subjective reporting. Furthermore, China hopes to deflect from the fact that the two countries were likely bypassing international laws regarding the export of dual-use equipment.

Pakistan deflected blame by pointing out that the Indian media always misconstrues facts in its reporting on the country. It also made claims that the company on the fraudulent BOL, Pakistan Wings, conducted the transaction legitimately using the appropriate channels. The country also pointed out how India did not have the necessary ‘credentials’ to determine and seize the equipment in the matter it did. Furthermore, Pakistan accused India of acting against international law and norms by seizing the CNC machine. This aspect of Pakistan’s response sought to build on its argument that India acted against international norms by saying the country is seizing its equipment because it can.

Joaquin Camarena
Joaquin Camarena
Joaquin the panda began Sino Talk in 2022 primarily to give an objective, unbiased view on China related topics as well as other issues related to the Indo-Pacific region. He spent several years studying and traveling throughout China and many countries in the Indo-Pacific region. In another life, the panda was also a U.S. Marine intelligence analyst who enjoyed bamboo MREs and drinking bourbon and soju. Indo-Pacific Division Desk Chief for Atlas News.

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