Rajiv Gupta

The DGFT started with the computerization of the DGFT network in 1995 but even after a lapse of 20 years till date they have not been able to achieve the same. The reason is simple because no bureaucrat ever wants the power to slip from their hands or the opportunity to harass the exporters. The export administration through software is in successful operation in most of the countries. I have been into exports since 1993 & seen it all. There is no rocket science involved in software for export administration but then garbage in & garbage out is the true story flowing out of the corrupt & rotten system. The DGFT would like to boast of digital signature just to extract a pound of flesh from the exporters but would not like to accept a digitally transmitted data from the Customs. The Prime Minister has been talking about digital economy for long now & the digitalization has reduced frauds in the system but then bureaucracy it seems, dies not like that at all. Therefore, the DGFT will not even bother to implement the Prime Minister’s directive or what is specifically provided for in the FTP several years ago. To my mind, all this is to protect inefficiency & corruption in the system. There cannot be two ways about it. It is not that the Udyog Bhawan or the North Block mandarins do not understand this but then they are simply stooges after all of the political establishment.

Also Read- Export Promotion: DGFT & CBEC- Why bureaucracy rejoices in failure of clean administration—Part 2

In this article we talk about a very specific issue of successful transmission of the S/B after the completion of exports to the DGFT office through EDI by the Customs department. The fact is that the data transmission in respect of the exports is in operation for the last several years & on the basis of this successful transmission of data, the MEIS entitlements have been issued. Even any simpleton will comprehend that encrypted data transmission between closed between two entities is secure & rules out frauds. Any sane person with little application of mind will very well understand that there is no purpose ever served by permitting loopholes to continue or by being a stumbling block in the implementation of the software in a meaningful manner. If the S/B data is successfully transferred to the DGFT & the MEIS issued by the system & the said data can be used for the discharge of export obligation or carrying out the redemption then why & how the DGFT should discard it. What is the vested interest of the bureaucracy in discarding this data for the discharge of the export obligation in case of Advance Authorization? Please note that it cannot be the case of any authority that the said data when used in Advance Authorization is not good but it is only good for the issue of MEIS entitlement when the fact remains that the DGFT is the policy making authority & the Customs is the implementing authority. Therefore, why the DGFT should indulge into such idiocy & the CBEC a consenting party to such an idiocy? Is it not really shameful & disgusting? Are the bureaucrats put in place for creating a transparent & clean system or solving their personal motives through a fiefdom approach? If the bureaucracy runs the system as a slave of their whims & fancy & follow the fiefdom approach, can there be justice in the system or can there be corruption free administration? Is the DGFT trying to cast aspersions on the Customs department by not accepting the data transmitted to them in respect of the shipping bills for the discharge of the EO/redemption of the authorizations? Is the DGFT trying to say that the Customs did not carry out their responsibility diligently in permitting exports under Advance authorizations in accordance with the law even after completing the appraisal & examination? If that is so then in how many instances of wrong doing, the DGFT has initiated action? Further, where even under the bureaucratic system, the DGFT is granted the big brother status to be the oversight authority & hold back the legitimate entitlements of the exporters without even issuing a reasoned speaking order & harass the exporters to no end? Why the DGFT remains completely oblivious to the misery of the exporters. Why the DGFT needs the physical copies of the physical documents, which is not environmentally friendly. The DGFT should understand that you degrade environment by cutting trees for the manufacture of paper. All readers will understand that the physical documents can be easily fudged & there have been several frauds repeated in the past. The story going around here in Mumbai is that because there is no responsibility & accountability in the system & the individual files can be closed at a price even if the export obligation is not completed very easily. Once again, the reason is very simple because nobody comes to know what documents are placed on record & whether they are genuine or not but that cannot be done in case of digitally transmitted document because the document can be easily accessible to any authority for examination. Therefore, it very much suits the purpose of the bureaucracy to call for paper documents. It is for the DGFT, CBEC & the RBI to answer that why digital documents are not used & strictly adhered to. Why the data transmission in respect of the S/B from the Customs is not acceptable? Why the e BRC is not acceptable? Why data in the Export Data Processing and Monitoring System (EDPMS) is not acceptable? How can the exporter be forced to take the print out & give copies thereof & how is it then ensured that these print documents are genuine? How does the DGFT official know that whether the S/B is genuine or the e BRC is genuine by way of the paper copies? Is it not something very fishy being protected in the system? How can the DGFT officials violate the use of e BRC or S/B data transmitted to them through EDI when the same is adopted & implemented by the law? My suspicion is bolstered from the fact when you see the number of people in the DGFT offices despite there being no need for human interface because the files should speak for themselves & work should happen. The CCTV footage should show you what’s going on & the reasons are not very difficult to seek. Why the persons should visit the official without a personal hearing being granted for a specific show cause? Another important aspect is that can it be the objective of the DGFT to collect penalties just because the paper copies are lost by the exporter?

S/B data is good for MEIS & rebate/refund etc. but not good for the discharge of EO. Is this then not outright cheating! I would like to share with you poor joke cracked by the DGFT officials at the expense of the DGFT & the DGFT preferring to keep silent & let the exporters suffer. Please note that there is an EOM facility on the DGFT website. In this EOM application, you can upload the S/Bs data transmitted from customs to the DGFT website in respect of a particular DGFT file under which the import authorization is issued. However, the RLA, Mumbai would not accept this data & the DGFT would not take any action to protect the corrupt & inefficient system. Can this arbitrary, pick & chose whimsical approach be acceptable? Why the authorization is then electronically transmitted to the Customs by the DGFT. Why the exports under the authorization are coded so as to be linked to a particular file? How this data is available on the DGFT website but not acceptable to the DGFT without assigning a reason. Is this not shameful & disgusting Idi Amin idiocy? Please note that data transmission has been operation since 1.10.2005. Now, even after more than a decade, the DGFT could not even put in place a proper interface & software is not making India a laughing stock for the whole world. As a matter of fact, these mundane tasks can be completed by the machines because in case of MEIS application, the DGFT office is simply take a printout & if you apply your mind that is not needed because electronic transmission is taking place & all further entries are on the system. Therefore why we are wasting the Security paper is difficult to understand. Not only this, please note that in case of several types of authorizations there are two copies printed on Security paper & both these copies are not utilized by the banks as well as the customs as on date because all entries are there on the system & not made on these physical copies. Why the DGFT is then not able to update itself in terms of the ground reality? Is it because then it exposes the DGFT to the extent that there is no real work carried out in these offices except being a stumbling block as evident from the plain reading of this factual analysis?

When there is no honest intention visible & there is no will to plug the loopholes then only corruption rules. This continues to be the bane of the Indian exports. There is a complete & abject failure & that is why even in an accelerated growth scenario visible in the world economies, the Indian exports are dwindling. The trade defict records 56 month high. Thanks to the Indian bureaucracy. Therefore it is time for the Parliament to take notice that whether DGFT is complying with the mandate of the facilitator or being the biggest stumbling block. I will continue with the story of arbitrariness & whims & fancy further & that is more riveting & shows to what extent they go just to ensure that an inefficient & corrupt systems remains in place.

(Above are personal view of Author and he can be reached at rajiv.pec@gmail.com)

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One response to “Export Promotion: DGFT & CBEC- Why bureaucracy rejoices in failure of clean administration- Part 1”

  1. Sanjay Singhal says:

    Sir, u hv rightly highlighted the issue faced by millions of exporters, especially those of EPCG scheme, where they have to bring 8 year old documents in original. This is also main problem why scams recur in India since govt uses computers to simply record data but leaves analysis to its own staff. Computers can be programmed to highlight deviations from norm & report automatically without human intervention. When concerned officials don’t take action, disciplinary action sd be taken.

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