SWIFT way to Trade
As part of ‘Ease of Doing Business’ initiative, Central Board of Excise & Customs (CBEC) took up implementation of Single Window Project early last year. The project aims to facilitate EXIM trade and enable hassle-free and smooth operations of international trade transactions across borders. The project would allow importers and exporters the facility to lodge their clearance documents online at a single point only. The Single Window Interface for Facilitating Trade (SWIFT), would reduce interface with governmental agencies, dwell time and the cost of doing business. SWIFT is a natural step for helping achieve the objectives of digital india initiative.
Rajendra Kumar Meena, Joint Commissioner, Single Window Project, Central Board of Excise & Customs, Ministry of Finance speaks to Rashmi Pradhan on how implementation of Single Window Project will help to boost EXIM trade
What was the objective behind setting up Single Window Project? With exponential growth in cross border trade and the developments in Information Communication Technology (ICT), trade expects faster and transparent service delivery at the time of import/export that provides an edge to its competitiveness in a globalised world. Businesses involved in international trade have to prepare and submit large amount of information to governmental agencies to comply with import, export and transshipment related regulatory requirements. This information had to be submitted to several different agencies, which have their own specific automated or manual systems to process the data. The system of filing regulatory information at multiple points was a tedious exercise for trade and affected the effectiveness of public service delivery for EXIM cargo.
A solution to this problem is to harmonise the regulatory compliance system through single window wherein regulatory information requirement needs to be submitted only at a single point to enhance the availability and flow of information among government agencies and trade, as a result of better harmonisation and sharing of the data. This can reduce costs both for government and trade.
In this context CBEC has taken up the Single Window Project for implementation as part of promoting ‘Ease of Doing Business’ and for facilitating trade across borders in India. The project is now known as SWIFT (Single Window Interface for Facilitating Trade) and is operational for facilitating imports throughout India with effect from April 1, 2016.
Please elaborate on how the entire process works? The project has enabled the importers to electronically file their regulatory clearance information at a single point only with the customs. The system then identifies consignments and respective regulatory agency from which it requires clearance. It facilitates all regulatory agencies to convey their decision about the release of import goods to customs and to the importer electronically. After the rollout of single window system, the required import permissions from other regulatory agencies are obtained online without the importer having to separately approach these agencies. This has become possible through a common, seamlessly integrated IT system utilised by all regulatory agencies and importers. Under the Single Window Project, ‘Integrated Declaration’ has been introduced wherein the Customs Bill of Entry format has been modified to include all clearance related data which was hitherto required in separate application forms by the agencies. Thereby nine different and separate documents have been replaced by a single electronic declaration. Single window will soon be extended to exports.
What are the advantages of SWIFT? The single window provides importers a single point interface for regulatory clearance of import goods thereby reducing interface with government agencies, dwell time and cost of doing business. Some of the specific advantages are as follows (a) Firstly, separate applications by various regulatory agencies have been replaced by a single electronic declaration thereby eliminating around nine forms. With the implementation of the single import declaration or the Integrated Declaration for all import regulatory information requirements, information required for import clearance by government agencies concerned is collected at a single-entry point, i.e. the Customs Gateway (ICEGATE). Separate application forms required by different agencies have been dispensed with. The information required by Customs and other Participating Government Agencies (PGAs) is automatically routed to concerned agencies for NOC/clearances without any human intervention.
(b) Second important element of SWIFT is the Integrated Risk Assessment, which is a dynamic risk based selection of consignments, whereby the question of reference of a consignment to PGAs for No Objection Certificate (NOC), kind of documentary examination, physical inspection of goods and testing required is decided at customs point itself by an IT system instead of erstwhile system of manually referring to various agencies. Thus, SWIFT is also implementing the policies of risk-based selective examination and testing.
(c) SWIFT also enables online clearance wherein all referrals of consignments to regulatory agencies happen electronically and their decisions are communicated back electronically. Thus, whole communication from business to government; between all government agencies and the communication from government to business have become electronic.
(d) In addition to this, CBEC is planning to introduce a facility for uploading digital copies of supporting documents, doing away with the need to submit hardcopies manually. CBEC is in the process of upgrading its ICT infrastructure which would enable trade to submit supporting documents like invoices, licenses, certificates, permits etc in electronic mode with digital signature. This would transform whole regulatory processing of import-export activity paperless.
How will this initiative help in Ease of Doing Business? SWIFT has been introduced as a single point interface for clearance and is expected to reduce documentation and costs while improving the transparency and accountability in the government process. It is expected to cover and benefit over 97 per cent of India's import-export trade. The single window saves paper work, reduces human interface and enhances efficiency by way of faster clearance. Recently a survey was conducted jointly by FICCI and KPMG on behalf of government of India, wherein taxpayers across the country had participated. The survey shows that 76 per cent respondents found improvement in customs clearance process due to introduction of single window scheme. Thus, SWIFT is improving the facilitation of trade by way of faster clearance with less transaction cost and more transparency. This innovative project is indeed moving towards achieving the vast potential of Ease of Doing Business initiative in India.
How were industry stakeholders involved in the project? Stakeholders from trade and industry have actively contributed to the success of SWIFT by providing valuable guidance in the initial stages of the project. Since SWIFT required changes to be introduced into the IT solutions operated by the cargo industry, the industry began associating their respective IT service providers at a very early stage. This helped in ensuring a high degree of preparedness on part of the cargo industry participants by the time of SWIFT’s launch. There were frequent and open communication between the project team and trade. While implementing the project, social media was deployed effectively to maintain instant communication, feedback and positivity. To a large extent problems were solved in a collaborative environment and with a spirit of co-operation.
SWIFT is providing a unified approach to international trade in goods. This has been made possible through effective coordination with all regulatory agencies to simplify and streamline their interagency procedures and documentary requirements for import and export of cargo. A Business Process Review exercise of regulations, trade policies, data/information requirements, operating procedures has been carried out and the same have been aligned with objectives of single window.
The single window system is a crucial implementation of trade facilitation. Efficiency in the import and export procedures would save large sums of money for importers and exporters because of reduced trade-related costs and delays.
Which are the agencies involved in issuing clearances or NOC for live consignments? The major import regulatory agencies in India which are involved in issuing clearances for live consignments that is post import have been brought in under the ambit of a single import declaration and the online clearance facility. The six agencies namely Food Safety and Standards Authority of India (FSSAI), Drug Controller General of India (DCGI), Plant Quarantine (PQ), Animal Quarantine (AQ), Textile Committee and Wildlife Crime Control Bureau (WCCB) are concerned with the vast majority of cases wherein NOC is required for regulatory clearance. Presently, SWIFT is functional with these six major regulatory agencies. However, any government agency can join it to become part of SWIFT whether it has its own robust system or not.
After implementation of Single Window Project, how much time is now taken for clearance of consignments? The project has reduced the time taken in obtaining clearances with other government agencies, by reducing human interface, and by increasing transparency. By introducing a system of risk-based selectivity of import and export consignments, all participating agencies would be able to focus on high-risk consignments while facilitating the clearance of low-risk cargo.
Further measures are underway to eliminate hard copy documentation by allowing trade to submit digitally signed electronic versions of the supporting documents and print outs. SWIFT would enable trade to compare the actual time taken by regulatory agencies with the pre-set norms or timelines published by them. With the time stamps for each intervening activity in clearances being captured by SWIFT, now it is possible to find bottlenecks in the clearance process with the help of tools like the WCO Time Release Study (TRS).
My personal experience of conducting TRS studies as a WCO accredited expert has revealed that TRS technique goes a long way in finding constraints in international supply chain and regulatory processing and fixing the same. The exercise helps in achieving greater efficiency and effectiveness in clearance procedure of EXIM trade.
