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The Reserve Bank of India, on Friday, announced a slew of measures that would help exporters by cutting down on paperwork and faster approvals and refunds.
“...it has been decided to announce further liberalisation in the extant policies governing certain export transactions. These measures, through delegation of more powers to the authorised dealer banks, will quicken the approval process, thereby improving the ease of doing business,” said the RBI in the Statement on Developmental and Regulatory Policies.
The RBI has now proposed direct dispatch of shipping documents and has removed the $1-million ceiling on export shipments for this.
“It has been decided to remove the monetary ceiling to enable AD banks to regularise such cases, where export proceeds have been realised, irrespective of the value of export shipment,” said the RBI. At present, AD Category – I banks (AD banks) can regularise cases where dispatch of shipping documents was made by the exporter directly to the consignee or his agent if the amount per export shipment is up to $1 million.
It has also been decided to delegate the power of allowing write-off to the AD banks, without limits in specified circumstances. Further, AD bank will be permitted to handle such write-off requests even if documents had been directly dispatched by the exporter, said the RBI.
“A large number of cases will be closed by banks, providing write off of unrealised exports value exceeding 10 per cent of previous calendar years exports, without referring to the RBI. This will save the transaction time of exporters,” said Sharad Kumar Saraf, President, Federation of Indian Export Organisations (FIEO).
The RBI said it has also been decided to permit AD banks to allow Indian companies to set-off their export receivables against import payables for goods and services with their overseas group or associate companies, either on net basis or gross basis through a centralised treasury arrangement.
AD banks will now also be able to consider refund requests without insisting on import of goods, which are perishable in nature, or had been auctioned or destroyed by the Port, Customs. Health authorities or any other accredited agency in the importing country subject to production of documentary evidence, the RBI further said.
At present, if refund of export proceeds to the overseas importer is required to be made due to poor quality of the goods exported, AD bank permits it only subject to re-import of the goods.
Saraf said off late there were disputes between exporters and banks regarding refund of export proceeds in such cases, and the move would address the problem.
India’s exports have borne the brunt of the Covid-19 pandemic. Exports declined by 9 per cent in November.
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