The Hindu Business Line : Mumbai Customs EDI a nightmare for importers

BOTH the Prime Minister and the Finance Minister of the country during their recent visits abroad tried to woo overseas businessmen and sell India as an attractive destination for direct investment, little realising how tough it is for businesses here to operate and how little the policymakers have done to redress genuine grievances.

A stark evidence of how things have gone from bad to worse over the last few weeks is provided by the operations of the Customs house in Mumbai and Jawaharlal Nehru ports where documents for clearance of liquid bulk cargoes have been held up for days.

After introduction of EDI (electronic data interchange) or computerised processing of customs documents from September 1, a large number of shipping documents have piled up at the Customs house pending clearance because "systems" are not in place and personnel manning the facility have little training to work on computer system.

Initial glitches that were brought to the notice of senior officials were dismissed as `teething problems'. But problems are continuing and now almost everyone is exasperated.

Incidence of demurrage (payment for detention of ship) has gone up.

"Even after six weeks of introduction of EDI, it takes days to obtain clearance of our documents," lamented an importer of edible oil.

While manual system of document processing used to take a day or two, EDI was expected to finish the job in hours, if not in minutes.

Ironically, what was supposed to be easy is turning out to be a nightmare for users.

Personnel working on the system are reportedly unhappy because of "lost opportunities to arm twist", as an importer of liquid bulk cargoes pointed out.

There is now suspicion of sabotage by insiders who want the process to revert to manual system.

Frustrations over inordinate delays in clearance of documents is forcing even importers to suggest reversion to manual system.

Liquid bulk cargoes that are cleared by the two major West coast ports include petroleum, chemicals, vegetable oils and alcohol.

Those in the know confide in private that EDI was introduced at the instance of the Finance Minister, who obviously was unaware of the lack of readiness on the part of Customs houses concerned. Revenue officials were probably too scared to tell the Finance Minister the real state of affairs.

Following the unending EDI glitches and acute congestion at Nhava Sheva port, many liquid bulk consignments are being diverted to other West coast ports. Such diversion will not only rob Mumbai Customs of revenue, but also result in additional expenses for importers, commented a port user.

Many importers and service providers this correspondent spoke to confirmed the existence of problem with Mumbai's EDI system, but refused to go on record or be quoted, possibly for fear of reprisal.

September and October are peak import months, especially for edible oils because of the festival demand.

Several ships carrying edible oil have lined up at various ports, but importers opting for clearance in Mumbai are undergoing undue hardship.

So much for Government's concern to curb rising prices of essential commodities.

Unless the Customs or border control procedures are streamlined in addition to several other measures necessary internally, there is little hope of attracting FDI on a large scale, commented a trade official.

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