Traders miffed at online fund transfer system

Exporters and importers expressed dissatisfaction over the compulsory online fund transfer for payment of various sums to the government, citing delays in the processing of information and chances of lapses in the security of transaction information as reasons.

Foreign trade agents, who act on behalf of those engaged in export and import business, are finding it difficult to follow the new procedure of filing online applications mainly owing to lack of bandwidth for the Directorate of Foreign Trade's website.

On the other hand, the new clause in the foreign trade policy, asking the traders to pay application money online using the internet banking facility, has raised questions about the security of transactions, they said.

According to an agent, though the Directorate of Foreign Trade is taking many initiatives to give a new look to the foreign trade procedure and is also simplifying the foreign trade policy, it has not considered the basic problems that a practitioner could face while following the amended procedure.

In the recently announced foreign trade policy for 2006-07, the directorate introduced a new online procedure of paying the application money by 'Electronic Fund Transfer' (EFT) making it mandatory for the practitioners to pay fees only through the internet banking facility. Earlier, paying by demand drafts was the practice.

"Though the intention behind launching EFT is to make the procedure technologically advanced, it has raised a question of security of transaction," an import-export practitioner, requesting anonymity, said.

"The Directorate of Foreign Trade has also announced changes in the names of certain schemes and has also announced a new structure of online application for which it has to replace the entire software, which will result in excess time consumption and will also increase the number of pending applications," he added.

K L Sharma, joint director general of foreign trade, Pune, admitted that the issues raised by export and import practitioners are genuine.

"There are certain obstacles that the practitioners are facing while following the new procedure. But these are only technical issues which can be sorted out over a period of time," he said. As for the question of risks involved in EFT, he said the directorate's software experts will definitely take care of the matter.

Sharma's reaction came on the sidelines of a meeting organised by the Mahratta Chamber of Commerce Industries and Agriculture to discuss the amendments in foreign trade policy and procedures.

Sharma said with the introduction of new foreign trade policy, "we will give more thrust on export of handicraft products and leather goods. African and Latin American market will be our thrust area in the coming years. We expect exports from India to touch the level of $165 billion by 2010."