FinMin to roll out scheme for faster export-import clearance

Exporters and importers may soon be allowed faster clearances for their goods, with the finance ministry planning to start a scheme that would simplify customs procedures and reduce intervention.

The scheme is aimed at ensuring secure movement of goods between India and other countries.

Under the Authorised Economic Operator (AEO), a party engaged in the international movement of goods would be approved by the customs as compliant with the supply chain security standards and accordingly benefits would be given. “We have received comments and will finalise the guidelines shortly. We have to decide the benefits in terms of faster clearance and less examination,” said a finance ministry official.

The finance ministry may begin by taking up pilot projects with six exporters. It is planning to roll out the scheme in phases. Initially, it will be voluntary since the the revenue department feels it would not be easy for every business to meet the stringent norms, which have high compliance costs.

The official said AEO would be given to secure people. To be eligible, a trader would have a sound track-record, good accounting system. financially solvent and a secure company.

The scheme would be similar to the Customs-Trade Partnership Against Terrorism, which is a supply chain security programme in the US. If those exporting have complied with the C-TPAT norm, they would get clearance faster. Later, a delegation from India may go to the US to see their model.

In December 2010, the government had released a draft paper on AEO for public comments. The AEO programme is being increasingly adopted by various customs administrations world over. It encompasses various players in the international supply chain such as importers, exporters, warehouse owners, custom house agents, cargo forwarders and carriers.

Once granted the AEO status, businesses will have a recognised quality mark which will indicate their secure role in the international supply chain and that their customs procedures are efficient and compliant. This may particularly benefit small businesses that account for the majority of importers and exporters.

An AEO status holder can enjoy benefits such as favourable consideration in any customs proceedings and a low risk score resulting in reduced customs examination and inspection, clearance of cargo before duty payment and periodical duty payment. Internationally also preferential treatment is accorded to exports from countries where AEO programme exist.