Govt to make it easy for exporters

India may be losing up to $10-15 billion a year

With reforms in tax administration identified as a focus area in next year's Budget, the finance ministry is considering a slew of measures to reduce transaction costs for exporters and facilitate trade.

According to estimates by the Organisation of Economic Cooperation and Development (OECD), India could be losing as much as $10"�15 billion a year on account of transaction costs.

Revenue Secretary KM Chandrashekar last week held a meeting with industry associations to consider the recommendations of a working group on trade facilitation set up by the finance ministry.

The working group, set up in April this year, has recommended speeding up the implementation of Electronic Data Interchange (EDI) and self-assessment of cargo. It has also suggested that states should be persuaded to allow Octroi collection by Customs.

As part of the capacity building exercise in the Customs department, the group has suggested restructuring field formations in Customs. It also stressed on enhanced use of technological aids, increased number of overseas postings and scientific training in examination and post-clearance checks.

The group, which recently finalised its report, has highlighted the fact that despite Indian Customs laws being based on international conventions and best practices, cargo dwell time for imports continued to be much higher than the international norms.

According to the report, most of the delay seems to be on part of the importer or his agent. "This is mainly on account of a regime of high rates of duties and other regulatory requirements," it said.

The group has also pointed out that too many exemptions were distorting the clearance process. Declaration forms for imports and exports are lengthy, mainly because of too many exemptions, which provide opportuntity for misdeclaration and evasion.