Introduction: The Directorate General of Foreign Trade (DGFT), under the Ministry of Commerce & Industry, has taken a significant step towards modernizing foreign trade procedures by implementing a system-driven, rule-based approach for the fixation of ad-hoc Input Output Norms. This initiative is designed to streamline the process, reduce the burden on exporters, and enhance overall efficiency in trade facilitation. This move aligns with the broader policy objectives of embracing technological advancements and fostering a collaborative trade environment.
Detailed Analysis: In its ongoing efforts to simplify and modernize the foreign trade landscape, DGFT has introduced a faceless automation system for determining ad-hoc Input Output Norms. This development is part of a broader strategy to improve the ease of doing business for exporters while minimizing the administrative workload for DGFT. By shifting to a system-driven, rule-based process, the DGFT aims to provide a more transparent, efficient, and predictable framework for exporters. The initiative to automate the establishment of ad-hoc Norms and notify new Standard Input-Output Norms (SION) under the Advance Authorisation scheme is rooted in amendments made through Public Notice No. 51/2023, dated March 14, 2024. These amendments to paragraphs 4.14 and 4.06 of the Handbook of Procedures 2023 are crucial steps towards enhancing trade facilitation. The Advance Authorisation Scheme allows duty-free importation of inputs for export production, and the eligibility of these inputs is determined by sector-specific Norms Committees based on input-output norms. Since the announcement of the new Foreign Trade Policy in April 2023, DGFT has been on a path of systematic revamp, focusing on expanding automated and rule-based processes. This modernization includes post-issuance audit capabilities and risk mitigation functions, ensuring that the processes are not only efficient but also secure and reliable.
Several processes have already transitioned to rule-based automation, including:
- Issuance and amendment of Importer-Exporter Code (IEC)
- Issuance of Status Holder Certificates
- Renewal of Registration Cum Membership Certificate (RCMC)
- Issuance, revalidation, extension, and invalidation of Advance Authorizations
- Certification for installation under the Export Promotion Capital Goods (EPCG) Scheme
These changes highlight DGFT’s commitment to embracing technological interfaces and collaborative principles, ensuring that India’s foreign trade infrastructure remains robust and competitive on the global stage.
Conclusion: The implementation of a system-driven, rule-based faceless automation process for the fixation of ad-hoc Input Output Norms by DGFT marks a significant leap towards modernizing India’s foreign trade procedures. This initiative not only simplifies the regulatory framework for exporters but also aligns with the government’s broader agenda of facilitating ease of doing business. As DGFT continues to roll out similar automation initiatives, the trade community can look forward to a more streamlined, efficient, and transparent operational environment. These advancements underscore the importance of technology in driving policy reforms and enhancing trade facilitation in the modern era.
***
Ministry of Commerce & Industry
DGFT implements system-driven rule based Faceless Automation for ad-hoc Input Output Norms Fixation
In line with ongoing efforts to modernize and streamline foreign trade procedures the Directorate General of Foreign Trade (DGFT) has decided that ad-hoc Input Output Norms will be determined through a rule-based, system-driven process, with the aim of improving the ease of doing business for exporters while reducing time and effort for both DGFT and concerned exporters. These changes align with a broader policy shift towards a facilitating regime that embraces technological interfaces and collaborative principles.
To further streamline and automate the process of establishing ad-hoc Norms and notifying new Standard Input-Output Norms (SION) under the Advance Authorisation scheme, DGFT previously announced an amendment through Public Notice No. 51/2023 dated 14.03.2024, amending para 4.14 and 4.06 of the Handbook of Procedures 2023. These amendments aim to enhance the ease of doing business and trade facilitation.
Moreover, DGFT is actively pursuing similar automation initiatives for other Foreign Trade Policy processes and procedures, emphasizing its commitment to modernization and efficiency enhancement in trade facilitation.
DGFT administers the Advance Authorisation Scheme of the Foreign Trade Policy, facilitating duty-free importation of inputs for export production, which includes replenishment of inputs or duty remission. The eligibility of inputs is determined by sector-specific Norms Committees based on input-output norms.
Since the announcement of the new Foreign Trade Policy in April 2023, DGFT has been actively revamping its systems to expand automated, rule-based processes under the FTP framework. These improvements encompass post-issuance audit capabilities and risk mitigation functions. Notably, several processes, including the issuance and amendment of Importer-Exporter Code (IEC), issuance of Status Holder Certificates, renewal of RCMC, and the issuance, revalidation, extension, and invalidation of Advance Authorizations, as well as certification for installation under the EPCG Scheme, are already being conducted through a Rule-Based Automatic process.
***
