GTRI alleges irregularities in duty free import scheme

NEW DELHI: Think tank GTRI on Sunday alleged massive irregularities in the duty free import-authorisation (DFIA) scheme, with unscrupulous elements taking advantage to import duty free walnuts, saffron, and lithium ion batteries for purported use to manufacture biscuits, pickles and tractors.

Some of these goods face high levies and the scheme was being misused as the licences could be traded. "In reality, they were never used in production. A mix of vague policy definitions, lax enforcement, and judicial interpretations divorced from reality has enabled a cartel of traders to bleed the exchequer, while regulators look away. What was supposed to be a lifeline for exporters is now a legalised smuggling channel," it alleged.

When contacted, the commerce department said that there are safeguards available to check against misuse and only payment of basic customs duty is exempted under the scheme. "In DGFT there is a permanent mechanism of norms committees across sectors for looking into complaints of misuse of SION (standard input output norms) norms and misdeclaration of inputs used. The SIONs are being reviewed across sectors and more specifically food sector to identify if there are any SIONs which have scope for unintended benefits," it said.

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