New Delhi, Sept 1 (KNN) When Government is working for simplification of international trade, some archaic procedures of DGFT are causing serious bottlenecks in internal trade.

Notwithstanding repeated request from small exporters, the Directorate General of Foreign Trade (DGFT) still allows revalidation of Advance Licenses for six months only from the date of expiry of the original license and not from the date of issue.

Advance license is a facility offered to the exporters or deemed exporters for duty free import of inputs.  The objective is to provide inputs to exporters at international price.

While the validity of such advance license is one year, exporters, particularly MSMEs often face problem in locating appropriate source of imports; often large international suppliers also not accept such small orders, as an MSME is entitled.

All these lead to delay in procurement of the inputs and in the meantime the advance license expire. So the license holders approach DGFT for its revalidation.

Now the archaic procedure of DGFT take often couple of months to issue the revalidation, but it is issued for six months from the date of expiry of the original license.

So the importer is often left with a month or two to complete the cumbersome procedure of import.

For removal of such archaic procedures WTO members signed the trade facilitation agreement whose objective is   expediting movement, release and clearance of imports and exports including goods in transit. Under the agreement there are also provisions for customs cooperation.

While the Government has recently constituted a national committee for trade facilitation under the Cabinet Secretary, even mundane issues as mentioned above wait for justice.

Common sense says that any order should be valid from the date of issue. But DGFT thinks otherwise.

Forgetting the logic that no one can apply for extension of a license before expiry and overlooking the fact that a minimum lead time is needed to submit an application for revalidation etc and its processing, DGFT revalidates the license for a limited period since the date of expiry.

While neither the Government and nor the licensee derive any benefit from such rigid approach, whose purpose is served by such archaic procedure is a moot question! (KNN/ DB)