DGFT Withdraws Recognition Of 15 PSIAs, Metal Scrap Importers Flag Clearance Delays

New Delhi, Sep 28 (KNN) The Directorate General of Foreign Trade (DGFT) has withdrawn recognition of 15 pre-shipment inspection agencies (PSIAs) following a review that found irregularities in the issuance of pre-shipment inspection certificates (PSICs).

Metal scrap importers have raised concerns over clearance delays, penalties and additional inspection costs.

DGFT Flags Irregularities In PSIC Issuance

The DGFT said the agencies had issued a large number of PSICs using a single instrument across countries without following prescribed inspection and certification procedures. 

It added that additional PSIAs have been recognised to maintain adequate inspection capacity and avoid trade disruptions, reported Business Standard.

Derecognised Agencies' Certificates Create Clearance Issues

However, importers whose consignments were inspected by subsequently derecognised agencies have reported difficulties during customs clearance.

An executive at a listed metal recycling company said the firm recently had eight consignments released at Mundra port after paying penalties and arranging fresh inspections, as certificates issued by derecognised PSIAs were not accepted.

Importers Flag Tighter PSIC Issuance Timeline

Importers have also flagged the revised timeline for PSIC issuance. On August 25, the DGFT mandated that certificates be generated and issued on the day of inspection, later extending the deadline to two days following industry feedback.

A one-time seven-day window was also provided to clear the backlog of certificates for inspections conducted before August 25.

The recycling company executive said seven consignments attracted penalties after PSICs were not uploaded within the two-day period, despite the cargo having already been inspected before shipment.

PSIAs Certify Metal Scrap For Customs Clearance

PSIAs inspect metal scrap at the port of loading and issue certificates confirming that consignments are free from radioactive material, arms, ammunition and explosives. Importers submit the certificates to Customs for clearance.

MRAI Seeks Scrapping Of PSIC Mechanism

The Material Recycling Association of India (MRAI) has called for scrapping the PSIC/PSIA mechanism, arguing that radiation-scanning infrastructure at Indian ports can provide the required safeguards.

MRAI Senior Vice President Dhawal Shah said most major ports have radiation scanners and suggested using domestic infrastructure instead of relying on overseas inspection agencies.

Government Reviews Port Scanning Infrastructure

The DGFT said it is consulting the Department of Revenue on the availability and operational status of scanning infrastructure at Indian ports.

It is also working to expand the list of designated safe countries and regions to reduce dependence on PSIAs.

India currently imports around 13 million tonnes of metal scrap annually, with about 2,500 containers handled daily by PSIAs globally, according to MRAI.

(KNN Bureau)