EEPC wants easier scrap import norms

Engineering units have asked for widening the number of inspection agencies authorised to monitor and certify containers with imported metal scrap.

At present only 26 agencies have been approved by the Centre to issue pre shipment inspection certificate. Importers want more agencies on the list so that cost of inspection comes down and more countries become eligible for shipping scrap to India.

The government has made the certificate mandatory from the country of origin (as compared to port of origin) so as to prevent entry of munition shells and mortars which have found way in the country through metal scrap imports.

Several exports have taken place in last few months causing death when munition shells mixed in scrap exploded, killing innocent people. Import of scrap has jumped many times in last one year as duty on the product has been cut to zero. Imported scrap is about 7-8 per cent cheaper than Indian scrap.

In fact, half of the import containers moving through JNPT in Mumbai contained either paper or metal scrap.

"Importers understand that the government is open to the idea of enlisting more firms as authorised inspection agency provided they are of institutions of repute," Rakesh Shah, chairman of Engineering Export Promotion Council (EEPC), said.

Since few agencies have been approved, the cost of inspection is coming almost $30 per day in the US.

Importers believe this could go down to below $10 once more agencies are authorised.

When explosions caused by munition shells hidden in metal scrap took place, the Centre asked the customs department to carry out inspection at ports.

However, the department confessed that it lacked adequate infrastructure to inspect the large volumes of scrap being imported. Imported scrap had to be brought out of containers and physically examined, but in the process acute congestions took place at ports.

Several containers were damaged as well during this destuffing. Following these practical problems, the government insisted on pre-shipment certificate from authorised issuers.

Experts said only scrap imported from conflict or war zone like Iraq contained munitions, but often it was routed through, and shipped from, peaceful countries like Saudi Arabia. The Centre is insisting on a certificate from country of origin to locate the source and take necessary pre-cautions.

In case the country of origin does not have any authorised agency like SGS operating there, it becomes virtually impossible to import from there.

More agencies of repute would help importers to source scrap from more countries.