FIEO organized an “Open
House Meet with DGFT” at Chennai on 2015.
Shri Pravir Kumar, IAS, Director General
of Foreign Trade, New Delhi, Shri Ajay Srivastava, Jt.DGFT, New Delhi, Shri Prakash Kumar Behera, IRS, Commissioner of Customs , Shri G.
Ravindranath, IRS, Commissioner of Service Tax, Shri J.V. Patil, ITS. Jt.DGFT
along with Dr. A. Sakthivel, Regional Chairman, FIEO Southern Region, Shri M.
Rafeeque Ahmed, Immediate Past President, FIEO were participated in the event. More than 375 exporters participated in the
programme.
Dr. A. Sakthivel, Regional Chairman, FIEO
Southern Region in his welcome address highlighted the issue of
contraction in exports during the last six months and requested DGFT to
consider the requests for exporters favorably which will help them to be more
competitive. Based
on the order booked position, he is apprehensive that export may significantly
decline in the coming months. Hence he urged the Govt. to immediately have
dialogue with the industry to understand the challenges, revisit the
strategies, and help the exporters to come back to the growth path. While referring to the high cost of credit, he
requested for reintroducing
Interest Subvention Scheme from 1st April, 2015. He also referred to
the delays faced by the exporters related to discharge of export obligations,
issuance of scripts, CENVAT refund and Service Tax Refund. FIEO Regional
Chairman also referred to the infrastructural bottlenecks faced by the
exporters.
 |
Shri Pravir Kumar, IAS, Director General of Foreign Trade, New Delhi addressing the participants.
From his left:
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Mr. Prakash Kumar Behera, IRS, Commissioner of Customs in his address said that in order to facilitate trade and
also to bring up ranking of India on “Easy on Doing Business”, the department
initiated 24x7 clearances. As per the
statistics available, Chennai Customs complete 80% of import assessment within
48 hours and 95% of export assessment within
24 hours. A Customs Clearance
Facilitation Committee has been constituted under the Chairmanship of Chief
Commissioner of Customs to take up all issues related to customs clearance on
faster track. While referring to the
monitoring of export promotion schemes, the Commissioner said that there are
lot of back-log in discharge of export obligation, release of Bank Guarantee
etc. and delays in getting Export Obligation Discharge Certification from the
Office of DGFT and requested for
addressing this issue on priority. Due to this, the department forced to put on
alert many of the exporters. This has
put many genuine exporters into serious difficulties, he concluded.
Shri
G. Ravindranath, IRS, Commissioner of Service Tax in his address said that
the Department is taking several initiatives to bring in India in better
ranking on Trade Across the Border Index.
The major parameters including document preparation, time consuming,
cost etc. has been attend to it. He
appreciated DGFT for bringing down the mandatory export documents to 3 towards
this objective. Regarding delay in refund of service tax claims of the exporters, he said that this is
mainly due to procedural issues, incomplete documentation etc. Regarding pending claims of SEZ units, he
said that we have already requested Development Commissioner to look into the
procedural bottlenecks.
Mr.
M. Rafeeque Ahmed, Immediate Past
President, FIEO
in his address stressed upon the need for announcing the Interest Subvention
Scheme immediately which he said will help exporters to be competitive in the
international market. Due to downward
trend in global trade, it is necessary that our product should be more
competitive so that we can increase our exports and interest subvention is one
of the important benefit in this direction.
He also highlighted various infrastructure hurdles faced by the
exporters which increased the cost. He
urge upon the Department to give more benefits for the export products which
are fully indigenous in line with Government’s “Make in India Policy”. He urged upon the participants to take all
efforts so that their cost will be less and product will be competitive thereby
profit can be earned by increasing volume.Regarding anomalies in the country
grouping, for MIES, he said that Hongkong, which is a gateway for our export to
China should be brought in the same Grouping of China. Some of the high labour oriented products
like Shoe Uppers etc. are being omitted
from SHIS scheme. He opined that if
issues being attended immediately in the policy along with attending various
issues of exporters including infrastructural bottlenecks, the exporters will
be able to bring in positive growth in the coming months.
Shri
Pravir Kumar, IAS, Director General of Foreign Trade in his address
highlighted various challenges faced by the export sector and stressed the need
of bringing back the growth. He assured
all support from the Government as a facilitator and urge upon the exporters to
work hard to bring more competitiveness and also diversify to emerging market
for growth. The Foreign Trade Policy
announced by the Government is to help exporters to enter into new markets and
also to become more competitive he added.
He asked the exporters to be innovative in products and marketing in
this difficult time. He also highlighted
various initiatives taken by the Government towards “Easy of Doing Business”
which he said will improve India’s ranking.
However, he said that all countries are working towards this direction
and India needs to move in faster pace for achieving this objective. He also informed that DGFT recently
introduced Online Payment Application Fee for various schemes through Debit and
credit cards. Thus obviating the need for visiting Offices. The exporters can now use Master/Visa/Rupee
cards and 53 banks already included in this project. This along with the steps taken in reducing
export, import documents from 7 and 9 respectively to 3 and various initiatives
of Digitalization and EDI will help in improving our ranking he said.
The exporters can now apply for all schemes
online by attaching all relevant documents and the need of submitting print
outs and hard copy of documents has been dispensed with except in case of MEIS wherein
proof of landing which is an important document which is required to submit by hard copy. Regarding the request of the exporters for
replacing Landing Certificate with BL,
letter from Importers etc. for Proof of Landing, he said that as this is an
important document and there is revenue consideration, this request cannot be considered at this
moment. He also informed that the
Revenue Department is working on a single window clearance system wherein all
other allied agencies like FSSI, Plant & Quarantine, etc. will be on Board
and all required documents and Certification will be done through Single Window
system instead of forcing exporters to go to each department for getting
clearance. This he said will revolutionize
the Customs Clearance and help us to get
better ranking.
Regarding infrastructure bottlenecks faced
by the exporters, DGFT said that the Department is seriously concerned on this
issue and very shortly a high level meeting with all States will be held to
discuss various issues including infrastructure, taxation etc. The study conducted by FIEO on “Study on
Infrastructure Bottlenecks in Industrial Clusters, Emerging Ports and Airports”
will be the base paper for discussion. He
also requested FIEO to update and get more information on requirements of
exporters related to infrastructure and also taxation so that the issues can be
taken up at this meeting. Regarding the
request related to Country Grouping including products under MIES etc. DGFT
said that he has received more than 1000 representations from various
sectors. Due to budget constraints all
requests cannot be considered. However
based on the merit some addition will be done which will be announced shortly
within 3-4 days time.
He also promised that once the economic scenario
will improve the Government may consider allotting more resources so that other
requests can be considered. He requested
exporters to optimize and focus the countries where India is having FTAs. Some of the incentives provided in the policy
is also to encourage India’s export to FTA countries.The consideration also
given on countries which is having higher trade deficit with India.
The following are the major points
discussed:-
Ø Australia, New
Zealand, Hongkong and Bangladesh, covered in Country Group C should be placed
in Country “B”. Similarly, Switzerland
& Norway should be placed in Country Groups “A” with other European Countries.
Ø
MEIS has been announced for Ayurveda & Unani Product but not for
Siddha Medical system. As the Department
of Ayush treats the traditional medical system i.e. Siddha at par with Ayurveda & Unani, MEIS benefit may
be considered for Siddha Medicine falling under ITC (HS) 30039013.
Ø
At times exporters have to export their goods from various ports. Filing separate application for each EDI
port will add to huge increase of number of applications affecting their
disposal. The facility of filing one single application for all EDI Ports may
be restored as this will reduce the
transaction cost to the exporter, save time of DGFT official in disposal of the
applications, save time and energy of Custom officials for registration and
handling of the Scrips for payment of Custom duty, etc. Para 3.02 (b) of HBP may be amended
accordingly.
Ø Exporters have been
experiencing difficulties in obtaining the landing certificates/ tracking
reports as they are required to pay heavy charges to obtain the same which adds
to the transaction cost as the issuance of this document entails an ever rising
fee charged by shipping companies. It
is suggested that Bill of Lading along with a Certificate from importer may be
accepted.
Reply:
This may not be possible as Board
also having reservation. This is a crucial
document.
Ø
Large numbers of exporters have received Status Certificate which are
valid beyond 31st of March, 2015. However, as per the new FTP such
exporters are required to file afresh for grant of status which involves
documentation and additional cost. Hence it is suggested that exporters may be
allowed similar facility to enjoy the status till the validity of the status
certificate to save transaction time and cost.
Reply:
As name and criteria including the currency has been changed in the
Policy, it is necessary that the Status Holder have to get new
certificate. The time has been extended
upto 15th September 2015 and requested all the Status Holders to
apply fresh.
Ø In the new
policy, the eligibility targets for
Status Holders are denominated in US Dollars.
However, shipments are made in
other valid foreign exchange also such as Euros, GBP, and Swiss Francs
etc. There is no clarity in the Policy
about how the Cross Currency rates will be applied for each shipment.
Reply :
The double weightage has been provided to help exporters to enter as
StatusHolders and once they reach the status, they should perform and climb the
ladder. Hence not possible to consider
this request.This is very clearly mentioned that the rate of exchange will be
taken based on Customs announced exchange rate applicable for the particular
period of exports.
Ø
Request
for time bound disposal of applications
Reply:
Presently Department is having shortage of staff. However, exporters now need to apply online
and hence human intervention is limited.
DGFT asked FIEO to identify cases where there is undue delay so that he
can look into the issue.
Ø
For
Polymer exports MIES is not available at present.
Reply:
DGFT asked the exporter to submit the representation.
Ø There are several
Buying Agents stationed in India who work on behalf of overseas clients
especially for Apparel Industry and who will coordinate with the manufacturers
based on customers requirement and closely monitor manufacturers
performance. Almost 80% of buying of
apparel industry is done through these agents presently. It is requested that services charges earned
by these agents may be made eligible for SEIS at 5%.
Reply: Due to limited resources available, it is not
possible to consider right at the moment.
However, we will make a note of
this demand.
Ø We are EPCG Licence holder wherein we have imported
capital goods which is needed for giving very specific services to the furnaces
for reconditioning. We have enormous
orders for providing this services across the globe and for that purpose we
need to take the capital goods, use it at the site abroad and return back after
completing the service. The EPCG Licence
has been issued with the condition that for taking the capital goods abroad for
executing the service exports, permission from DGFT is required. However, when applied for permission, DGFT
rejected our request. We request you to
kindly make suitable amendment so that we can regularly take the capital goods
for providing services to our overseas
customers and bring it back without any hurdle.
Please note that we are having excellent orders and will be able to
complete the export obligation within 2 years period provided the Department
allow us to do service abroad by using this capital good.
Reply: As per Policy, capital goods needs to be installed in the premises. As this is a special case, this will be
examined in consultation with the Department of Revenue. Exporter is requested to make a separate
representation in this regard.
Ø The fees earned by
Educational Institutions in foreign currency from NRI/overseas students may be
made eligible under SFIS scheme.
Reply: If physical position improve this kind of
request can be considered.
Ø
For
Leather Garments 9.6% Duty Drawback is
allowed provided 60% of visible surface area will be made out of leather. However, the Customs insist that exporters
should declare exact percentage of leather used in the leather garments which
is difficult to comply with and time consuming.
Even though this is not insisting in other ports, Air Customs is asking
for documents.
Reply: Commissioner of Customs informed
that he will look into this issue.
Ø
Export
from DTA to SEZ treated as at par with
exports and hence, duty drawback should be given by the Customs Department of
SEZ location. However, this has been
denied and treated as deemed exports wherein there is inordinate delay in
getting duty drawback.
Reply:
Exporter has been asked to take this issue up with Development
Commissioner.
Ø
There
is inordinate delay in getting the refund of Service Tax for supply to SEZ
units.
Reply:
This is purely due to procedural
issue and incomplete documentation as there is a need for verification of
signature in Form A-2. However,
exporters has been requested to submit specific cases for examination.
Ø
There is inordinate delay in getting
incremental export benefits for the exporters even though it is within the 25% ceiling.
Reply:
Instructed JDGFT to look into this issue.
Ø
The
Customs make CHA responsible for any bad
deeds, even though CHA do not have any
control on the subject as IEC is being issued from the Office of DGFT with due
verification made by the Department.
DGFT agreed to view
CHA’s that they cannot be responsible for any fraudulent activities done by the
exporters. He assured that he will take
up this issue with CBDT.
Ø As per Para 3.05
(b) read with Para 3.01 (g) Hand Book of Procedures, manual entry of EDI Shipping Bills has not been permitted after 30.6.2015 onwards
and the transmission of EDI Shipping
Bills from the CUSTOMS to DGFT server
have not been still completed for a lot
of shipping bills. Hence request DGFT to extend the time limit, till
the process of transmission of Shipping Bills are completed in all the EDI
ports and also permit for manual entry of EDI Shipping Bills which have not
been transmitted.
Reply: Presently 95% of export is done through EDI
Port. In most of the cases, wherein
shipping bill not appearing in the DGFT website from Customs website to DGFT. It has been noticed that it is due to wrong
entry in the system. From 1st
April 2015 while filing the shipping bill CHA need to declare Yes/No in the system regarding availment of
Chapter-3 benefits. In all the cases, it
has been noticed that CHAs click ‘No” and hence the document will not transmit
to DGFT site. Hence, there is no need for
extending the time limit. Specific cases
needs to be taken up separately.
Ø In the Previous
FTP, there was a provision under Para 3.11.9, in which an option was available
to file the claims within 6 months from the date of realization (or) 12 months from the date of export
whichever is later. This provision has
been deleted in the Current Policy of FTP 2015 – 20 in Para 3.15 of HBP. Hence, we request DGFT to restore the above
provision of filing the claims within 6 months from the date of realization as
many exporters in Tirupur are realizing the export proceeds even after one year
due to split up payments by the overseas buyers.
Reply: maximum one year time for
filing the claims have been given based on RBI Guidelines based on the time allowed for realization of export procedures.
Ø
As per the conditions laid down for fulfillment of Export Obligation
through Third Parties in Para 5.10 (d) of Handbook of procedures 2015 – 20 is
affecting the units carrying out job work in cluster like Tirupur and in view
of this, we request to make amendments and follow the procedures laid down in
previous policy 2009 – 14.
Reply: This issue already flagged
in and had meeting with DRI in this regard.
Internal Circular giving necessary clarification will be issued shortly.
Ø EOU / SEZ Units in Tirunelveli District use
Tuticorin as Gateway Port. As most of
the time there is congestion, it is suggested that a separate gate entry may
given for SEZ & EOU for faster clearance of cargo.In order to handle bulk cargo
for exports, bonded warehouse may be created at Tuticorin Port.EODCs are not issued in time and exporters are receiving show case
notices. We request for immediate intervention to ensure the exporters are not
put to undue hardships and sufferings.
Reply: The case is related to JDGFT, Bangalore. Instruction has been given for look into this
issue. Exporter has been asked to get in
touch with JDGFT, Bangalore and in case of further difficulty give details to
FIEO for taking up.
Ø
For
the Service Tax Refund, the Department is asking for original document for
verification. There is also inordinate
delay for years together for getting refund.
Reply: It has been clarified by the Service Tax Commissioner that submission of original
copies of invoice is necessary for verification which will be returned to the
exporters after verification.
Ø
This
is to bring to the notice of DGFT that shipping Bills related to MEIS is
not appearing in DGFT website from 1st
April 2015.
Reply:
Exporters has been asked to contact CHA and verify whether declaration
of intent has been done appropriately so that the shipping bill detail will
appear in DGFT website.
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