Not a 'soft' is­sue

Maritime Gateway - - Contents - By Deepika Ami­rapu

MG spoke to the Soft­ware Tech­nol­ogy Parks of In­dia to un­der­stand the pain points. Read on to know more…

In­dian IT in­dus­try is fac­ing cer­tain is­sues in im­port­ing hard­ware. MG spoke to the Soft­ware Tech­nol­ogy Parks of In­dia and a few of its big lea­guers to un­der­stand the pain points. Read on to know more…

The In­dian soft­ware in­dus­try’s an­nual ex­ports of ser­vices ac­count for $120 bil­lion from five key met­ros of the coun­try. What is your guessti­mate on the amount of hard­ware and other equip­ment they would re­quire to ex­port this value of ser­vices? A lot, you’re right. And most of their im­ports of elec­tronic equip­ment come by sea. MG spoke to the Soft­ware Tech­nol­ogy Parks of In­dia and a few of its big lea­guers to un­der­stand if the sail­ing has been smooth. Here’s where the in­dus­try needs help:

Clear­ance at Cus­toms: Soft­ware com­pa­nies need two ap­provals from the Cus­toms and the Cen­tral Ex­cise Depart­ment to im­port equip­ment in to In­dia. Once the STPI au­tho­rises im­port of a cer­tain quan­tity of equip­ment, the two gov­ern­ment mon­i­tor­ing agen­cies are ex­pected to clear the Bill of En­try and is­sue a clear­ance to en­sure the im­port is not held up. How­ever, de­lay by ei­ther agency causes the im­porter to bear in­ven­tory costs and pay a huge sum for in­sur­ing and stor­ing equip­ment.

In­dus­try sug­ges­tion: Can these two ap­provals be given at the time of im­port and be cleared at the bonded area?

In­dus­try sug­ges­tion: If the doc­u­ments can be made digital, clear­ances by and from all par­ties can be sought within the free pe­riod to avoid pay­ment of de­mur­rage.

Im­port of used equip­ment: The gov­ern­ment has cur­rently re­stricted im­port of used equip­ment en­forc­ing the anti-dump­ing law and the cus­toms ob­jects to such im­ports. Soft­ware firms have to ob­tain clear­ances from the Min­istry of En­vi­ron­ment and Forests be­fore any equip­ment is im­ported. How­ever, im­ports are al­lowed un­der spec­i­fied cases which are made known only at the time of im­port if the firm asks for clear­ance stat­ing the pur­pose.

In­dus­try sug­ges­tion: By law, if used equip­ment is im­ported for a short du­ra­tion for a spec­i­fied pro­ject, im­port of such prod­ucts should be al­lowed. It would help if the Cus­toms makes know the pro­ce­dure stat­ing the per­mis­si­ble lim­its – quan­tity and value, pay­ment of ex­cess du­ties can be avoided.

Im­port of Hard­ware: For any out­right pur­chase of hard­ware for use by the in­dus­try, such an item should ap­pear in the Cus­toms list of equip­ment. In the ab­sence of the item not be­ing part of the usual list, the Cus­toms asks for a tech­ni­cal write-up from the im­porter, hold­ing the equip­ment in the bonded area un­til it re­ceives a sat­is­fac­tory re­ply. This causes de­lay in projects lead­ing to time and cost over­runs, not­with­stand­ing the in­ven­tory charges.

In­dus­try sug­ges­tion: The STPI and Cus­toms should work to­gether in list­ing all pos­si­ble equip­ment that is cleared for im­ports so as to not with­hold any equip­ment. Any state­ment re­quired should be ob­tained di­rectly from the STPI as the nodal body and not the ship­per.

GST: The an­nounce­ment of this tax­a­tion has elim­i­nated the re­quire­ment of many a doc­u­ment re­quired by the Cen­tral Ex­cise Depart­ment and in­tro­duced a few fresh ones. The in­dus­try hopes there is a clear list of doc­u­ments to be submitted to the Cus­toms for im­port-ap­proval to has­ten the clear­ance pro­ce­dure.

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