Finance Minister Releases Report of Task
Force on Transaction Cost in Exports
Reduction of Transaction Cost to Impact on
Competitiveness of India’s Exports – to Benefit SMEs
The
Report of Task Force on Transaction Cost in Exports was released on 8 February
by the Finance Minister, Pranab Mukherjee
in the presence of Anand Sharma, Minister of Commerce
and Industry and Jyotiraditya M Scindia,
Minister of State for commerce and Industry. The Task Force chaired by Mr. Scindia was
constituted in October 2009 to identify and suggest ways to achieve significant
improvement in the functioning of export processes and reduce time and money
spent in export transactions, with a view to enhance the competitiveness of
Indian exports. The function was attended by Rahul Khullar, Commerce Secretary; Dr. Anup
K Pujari, Director General of Foreign Trade (DGFT);
and representatives from the trade and apex champers.
Speaking on the occasion, Mr. Sharma said that the average
cost to an exporter on account of transaction costs has been monetized at a
level of US$ 945 per container as compared to US$ 460 in China, US$ 450 in
Malaysia and US$ 625 in Vietnam. The e-Trade Project under the Department of
Commerce was conceived with an objective of ensuring electronic delivery of
services to provide 24 hour access to users and to simplify procedures, making
them trans-parent.”
While delivering his address, Mr. Scindia
said that based on the interactions with stakeholders, the Task Force
identified 44 issues and taken up with the relevant Ministries and after
consultations with them, it was agreed to implement 32 of these issues. “Of
these, 21 issues have been implemented and another 2 are likely to be
implemented in a couple of months. The remaining issues are under the process of
examination and consultations for implementation. It is expected that implemen-tation of 23 issues is likely to mitigate the
transaction cost by approximately Rs.2100 crore.
Permanent reduction of transaction cost through these initiatives will have a long
term positive impact on the competitiveness of India’s exports.”
1. The five major Regional Plant Quarantine
Stations have been fully equipped to perform their function of preventing the
introduction of any insect, fungus or other pest, which is or may be
destructive to crops, to facilitate safe global trading in agriculture.
2. The plant quarantine services at
International Airports Chennai and Mumbai will now be available round the
clock. Also, the issuances of Phytosanitary
Certificate necessary for trading will be expedited.
3. A committee of experts is constituted to
look into providing Animal Quarantine and Certification Station (AQCS)
facilities at ICD Kanpur and Jalandhar. Also, it has
been decided in-principle to allow imports of raw leather at ICD Kanpur,
modalities will be notified shortly.
4. The Delhi International Airport has reduced
the charges levied for screening express cargo and courier shipments from Rs 6
to Rs 1.65 per kg for the export courier at its Express Courier Terminal at IGI
Airport.
5. As per the Public Notices No. 3/ (RE:
2010)/2009-2014, dated 23/08/2010, DGFT has done away with the requirement of
submitting Chartered Engineer’s Certificate while submitting application for
Advance authorization under paragraph 4.7 of the hand book of procedures.
6. The norms approved by Norms Committee for
same export and import products for authorization obtained under paragraph 4.7
(ad -hoc norms) will now be valid for one year (both past and future). Earlier
these norms covered only prospective authorization.
7. DGFT vide its
Public Notice No.24/2009-2014 dated 17/1/2011 has dispensed with requirement of
submitting Performa invoice for obtaining an import authorization.
8. There would be no need to submit Performa
Invoice for obtaining export authorization for restricted items (except SCOMET
items) as per the Public Notice No.20 dated 5/1/2011.
9. In case of the DEPB Scrip, if the
application has been filled online, there would be no need to submit hard
copies of DEPB EDI Shipping Bills.
10. MDA approvals would now be made in the
name of organization and not individual. In this new scenario, even if the
nomination changes at the last moment for participation in international fairs,
company would still be able to avail MDA benefit.
11. Exporters would now be able to club Annual
Advance Authorisation with Advance Authorisation.
12. Now the exporters would be able to file EPCG
application and Advance Authorisation off line and
submit at a later time. This would facilitate speedier filing and ease burden
on DGFT server.
13. 24X7 customs clearance would now be available
at eight custom ports, namely- Vizag, Kolkata,
Jamnagar, Mangalore, JNPT, Mumbai, Bhubeneshwar and
Chennai.
14. The Recognised
Status Holders have been extended benefit of Accredited Clients Programme (ACP) to provide them assured facilitation vide
CBEC Circular No.29/2010-Customs dated 20th August, 2010.
15. A single factory stuffing permission valid
for all customs ports has been introduced; subject to certain condition vide
Circular No.20 dated 22/7/2010.
16. The CEBC has issued instructions to all its administrative staff to ensure timely refund of
credit balance in CENVAT account to exporters.
17. There would be no need to submit Mate Receipt
to Central Excise for establishing date of export.
18. RBI has instructed all the Banks to ensure
post shipment credit is available at prescribed rates up to 180 days as
stipulated incase of over due
bills.
19. Leading banks have reduced the processing
charges for renewal of Annual Limit.
20. Booking charges for the foreign currency have
been reduced from Rs 750 per transaction to Rs 400-500 per transaction.
21. The leading banks have again been instructed
by RBI and have confirmed to extending the Pre-shipment credit in foreign
currency at LIBOR+2% with no additional charges levied.
22. A single bond would now be required to be
submitted by the organization for multiple authorizations to be obtained from
customs reducing the unnecessary paper work both at custom and organization
level. This would be implemented in few months time and would save transaction
cost of Rs 400 crores.
23. With a view to expedite refund of service tax
on output services, it is proposed to introduce an
“All Industry Service Tax Rate” on the lines of “All Industry Rate of Duty
Drawback.
[Source:
PIB (MoC&I) Press Release dated 8 February 2011]