ENTREPRENEURIAL OPPORTUNITIES IN EXIM DOCUMENTATION - INDIA PRESENTED BY HARSHAD TP VIAJYEESWARRI JAYAVEL A GLIMPSE INTO THE TOPIC India's total merchandise trade has increased over three-fold from $252bn in 2006 to $794 in 2012 - both exports and imports have trebled during this period according to the Export Import Bank of India (Exim bank) India exports approximately 7500 commodities to about 190 countries, and imports around 6000 commodities from 140 countries. India exported US$ 310.3 billion and imported $447.9 billion worth of commodities in 2015. Before 1990 the documentation process was manual and lacked proper co ordination. Caused,delays in transit of goods ,mistakes in paper works which often lead to tiresome and frustrating procedure/s 1991india adopted Aligned Documentation System(ADS) which is an internationally accepted documentation system. Traders are seeking the help of third parties like shipping agents, foreign trade consultants , forward agents etc for export import procedure and filing of documents • As per the World Bank Trading Across Borders report of 2015, India stands at 126 out of 189 countries, while China ranks 98, Brazil 123 and South Africa 100. • It takes 17 days to export a container while it takes 21 days to import one in India. • While in China, the per-container cost of export is $800, in India it is $1,400. • Department of Commerce (DoC) estimates that poor trade facilitation results in transaction cost of R42,000 crore ($6-7 billion). As per DoR, such delays are caused largely due to port congestion, lack of timely response from other regulatory agencies, etc. For example, 76% vessels have to wait for two or more days for allotment of berths in the three commissionerates of Kochi, Kolkata and Mumbai. Similar is the case with containerised consignments, which need more than three days for clearance forcing the importer to shell out demurrage charges for storing. * As a consequence, after issue of the DGFT's Notification dated 12-32015, only three documents each would be mandatory documents for export and import. Delays in examination of imported goods and goods for export by customs is a major bottleneck in cargo clearance. Across seven commissionerates, CAG finds that examination of goods exceeding 24 hours is about 22% of all consignments examined. Examination of goods beyond 24 hours has shown an increasing trend. Percentage of examination of goods beyond 24 hours at Chennai sea and air commissionerates rose from 11.27% to 22.42% and 5.87% to 32.76%, respectively, during 2010-11 to 2013-14. Shortage of customs officers of the rank of examiner/preventive officer, nonavailability of mobile gamma ray container scanners at some commissionerates, and lack of coordination among agencies have been blamed as primary reasons. * Data from five customs commissionerates of Chennai, Cochin, Mumbai NCH and JNPT, and Bangalore Air customs reveal that 67% of authorisation and licences took over three days for registration. * In general, registration of licences taking time over three days has increased from 58% in 2010-11 to 78% in 2013-14 across customs commissionerates. * Errors and delays in filing of Import General Manifests (IGM) by shipping agents for declaration of complete list of cargo has been a major contributor in prolonging the dwell time for importers. * Incorrect filing of IGM delays processing of BE, which is filed on the basis of IGM, thereby slowing down the pace of cargo clearance. * As per section 46 of the Customs Act 1962, BE can be filed prior to the delivery of IGM. But only 25% BEs are filed within 24 hours of filing of IGMs, while 50% BEs are filed after three days. * CAG-PA identified delays in obtaining necessary documents from steamer agents, suppliers, incorrect documentation, insufficient funds as possible reasons for such delays. PARTIES INTERESTED IN EXPORT IMPORT IMPORT DOCUMENTATION Buyers and exporters, Buying agents, RBI, Authorized dealers (where the exporter has his bank Account Buyer’s bank (foreign bank) DGFT Customs and Port Authorities VAT and Excise Authorities EPC’s, Insurance Companies Inspection Agencies Clearing and Forwarding Agents Shipping Companies/Airlines and Inland Carriers etc EXPORT DOCUMENTS:- CLASSIFICATION I. COMMERCIAL DOCUMENTS I. REGULATORY DOCUMENTS II. EXORT ASSISTANCE DOCUMENTS III. DOCUMENTS AS PER THE REQUIREMENTS OF IMPORTING COUNTRIES I.COMMERCIAL DOCUMENTS 1. PRINCIPAL COMMERCIAL DOCUMENTS 2. AUXILARY COMMERCIAL DOCUMENTS III.EXPORT ASSISTANCE DOCUMENTS • The documents which are required for claiming assistance under the various export assistance measures as may be in operation from to time. Currently, these refer to drawbacks of central excise and customs duties, packing credit facilities etc.. IV.DOCUMENTS REQUIRED BY THE IMPORTING COUNTRIES These documents are required by the buyer in order to fulfill the legal requirements of his government these include documents like certificate of origin, Quality control certificate , consular invoice etc The Central Board of Excise & Customs (CBEC) has initiated a comprehensive review of the regulatory and compliance framework governing export-oriented units (EoUs) and Software Technology Parks of India (STPI). There are around 1,977 EoUs in the country with exports to the tune of over Rs 1 lakh crore and 3,800 independent STPI units with exports of about Rs 3 lakh crore. Ease of doing business has been identified as a major focus area by the CBEC, the apex indirect taxes body. The board is keen to build on its efforts that helped the country jump to 35th position from 54th on the World Bank's Logistics Performance Index. Courtesy: The Economic Times * Ease of doing business Reducing time delay Reducing crowd Efficient Performance Innovation / Software for documentation Creating a bench mark Absolutely safe and secure Transactions. Integrated software among buyer , importer and the cargo Easy payments and online support. Eliminating mobility of importer / exporter. At present there is a huge scope for third party foreign trade facilitating professionals like shipping agents, foreign trade consultants , forward agents etc for export import procedure and filing of documents and thus assisting in ex-im business Scope of International Consultancy Services: End to end supply chain review Vendor assessment and performance management tools International trade risk assessment Purchase order management Explanation and assessment of charges including landed cost Development of calculators to determine best available freight options Air and Ocean carrier cargo requirements Incoterm training and advice including risk and cost Offshore purchasing and sourcing services Trade banking review Foreign exchange and working capital review Letter of credit assistance * Where to study There are several institutes offering programmes in International Business, or Foreign trade. These include the Indian Institute of Foreign Trade (IIFT), New Delhi, and several of the B-schools which offer the 2-year, full time Master's programme in International business. There are also a number of courses — diploma, certificate and online courses being offered by several institutes such as the Indian Institute of Export and Import Management in Mumbai, Indian Merchants Chamber, Mumbai and others. The Delhi School of Economics offers a 1-year P G diploma in International marketing, Punjab University offers a 1-year PG diploma in International Trade and other courses include those at Gujarat University, University of Madras, Mumbai University, Pune University, Kurukshetra University, and distance programmes at IGNOU, BR Ambedkar University, Kota University and Karnataka State Open University. Institute watch •The Indian Institute of Foreign Trade, New Delhi; •Delhi School of Economics, Delhi University; •Indian Institute of Export Management, Bangalore •Indian Institute of Export and Import Management, Mumbai •Indian Merchants Chambers, Mumbai •Indian Institute of Commerce and Trade, Lucknow •Punjab university, Chandigarh; •Kurukshetra University, Haryana •Gujarat University, Ahmedabad; •University of Madras, Chennai. •Export Import Bank of India(EXIM Bank) Department of International Business also offers PG Diploma in Foreign Trade REFERENCES : REPORTS FROM: WORLD BANK EXIM BANK ARTICLES FROM THE GURADIAN THE ECONOMICS TIMES PUBLISHINGS BY DGFT(DIRECTOR GENERAL OF FOREIGN TRADE) Thank You!
