Ludhiana exporters rue infra bottlenecks.

With 13,500 TEUs (twenty foot equivalent units) of cargo being handled by the Inland Container Depots (ICDs) in Ludhiana per month, the city has emerged the biggest ICD in the North after Delhi. However, exporters and Customs house agents (CHAs) rue that the infrastructure bottlenecks have led to delay in clearance of duty drawback and incentives under the (Duty Entitlement Pass Book) DEPB scheme.

It is worth noting that out of these 13,500 TEUs, the volume of export is 6,500 TEUs and the remaining 7,000 TEUs are imports. Among the major commodities which make up for this volume are yarn, hosiery goods, bicycle parts, auto parts, other engineering goods and rice.
 
Speaking to Business Standard, a CHA, on the condition of anonymity said, “Since 2000, Ludhiana ICD is an electronic data interchange (EDI) enabled port. Earlier when EDI system (server) was first introduced at the port, the infrastructure provided was not only inadequate but was obsolete. Trade struggled for almost a decade, when in 2010 this port was put on central sever, which had better speed and is being controlled from New Delhi.”

He added, “Although, the entire working is on the new EDI system (ICES version 1.5),the scene remains the same due to inadequate infrastructure. As a result the Duty drawback is pending to the tune of crores of rupees. Some of the cases are as old as 2008.” Custom officials also admitted there was severe shortage of staff in the department.

He added further, “Also, export under other incentive schemes like DEPB is equally affected. Though the export procedure is completed and the goods are delivered to the buyers overseas, the shipping bill is still pending in the Customs records. There would be around 5,000 shipping bills dated as long back as 2008 pending on account of Export General Manifest (EGM) closure. He also alleged the message exchange system between Customs and DGFT was not functioning well and both departments kept the other department at fault. The exporter was at the receiving end and his incentives in shape of DEPB got struck for over years.

He also mentioned that the association held various meetings on the issue, along with the leading exporters of the region, with the senior Customs officials in Ludhiana, but the problems could not be resolved.

On being asked about the problem arising in imports, another CHA said, “ The notifications affecting the assessment of import consignments are not updated in the system. The bills of entries are put on hold for long period of time, just because the new exchange rate could not be uploaded on the EDI system. tHE Recent case is only on May 1,1010 no BE could be filed due to non updation of exchange rates in EDI System.”

He also maintained the new EDI system had trouble accepting old advance licences, Export Promotion Capital Goods (EPCG) licences etc. He added even in some cases the exporters were opting for other ICDs even if they have to shell out extra money as freight costs to avoid delay in clearance of DEPB, Duty drawback etc.

Source : Business Line