The commerce ministry has trimmed the list of adjudicating authorities and also allowed re-export of imported goods to Iran in rupees. The Reserve Bank of India (RBI) has now prescribed a time limit for realisation of export proceeds for units in Special Economic Zones (SEZs) and raised the limit for receiving payments through online payment gateways.
Section 13 of the Foreign Trade Development and Regulation Act, 1993, empowers the Director General of Foreign Trade (DGFT) or any officer specified by the central government to impose a penalty or order confiscation for contravention of any provisions of the said Act or rules, orders or notifications made/issued under it. Last Thursday, the commerce ministry stripped the powers of the Foreign Trade Development Officer, Dy. DGFT, Zonal Joint DGFT and Export Commissioner to adjudicate. The powers of other authorities to adjudicate remained unchanged. The ministry also empowered the DGFT to constitute a bench of two Additional DGFTs as appellate authority on matters relating to export-oriented units (EOUs).
Re-export of goods imported against payment in freely convertible currency was permitted against payment in freely convertible currency. Last week, the government allowed export of such goods against payment in rupees to the countries notified by the DGFT, subject to at least 15 per cent value addition. The DGFT notified Iran as an eligible country under this relaxed provision. The ministry also mandated the production of a Sanitary Import Permit from the department of animal husbandry, dairying & fisheries for import of livestock and certain other items.
Exporters are required to bring in export proceeds within specified time limits. However, SEZ units were exempted from this discipline. Last week, RBI prescribed a time limit of 12 months from the date of export for realisation of the export proceeds by SEZ units. This discipline was somewhat overdue. But, RBI left some SEZ units in doubt on whether this would apply to exports already made. RBI also surprised the SEZ units by stating that any extension of time beyond this stipulated period may be granted by RBI on a case to case basis. This prescription is more stringent than those prescribed for other exporters who can seek extension from banks, more or less on an automatic basis. RBI should quickly clarify that even for exports made before last week's circular, extensions should be obtained for bills unrealised within 12 months.
It should also examine if it would be better to let banks consider requests for extension in the time limit from SEZ units. AD (Authorised Dealer) Category-I banks were permitted to offer the facility to repatriate export-related remittances by entering into standing arrangements with Online Payment Gateway Service Providers (OPGSP) for export of goods and services for a value up to $3,000 a transaction, subject to certain conditions. Last week, RBI increased the value per transaction from $3,000 to $10,000 for export-related remittances received via OPGSPs. This move will help sale of consumer goods such as gems and jewellery, apparel, books, music, movies, home appliances, carpets, spare parts, etc. Rafeeque Ahmed, president, Federation of Indian Export Organisations, said it would help boost India's exports through the e-commerce route to grow 30 per cent from the current level of $1 billion.
Source:-www.business-standard.com
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