E-Commerce Sector Urges Centre To Allow FDI For Inventory-Based Export Mode

New Delhi, Nov 18 (KNN) The e-commerce industry has recommended the government to permit foreign direct investment in the inventory-based model of online trade exclusively for export purposes, a senior government official said on Friday.

At present, the FDI policy does not permit foreign direct investment in the inventory-based model of e-commerce.

Director General of Foreign Trade (DGFT) Santosh Kumar Sarangi said that they are working on several steps to promote exports through e-commerce medium.

He said that the e-commerce stakeholders have asked the department for the promotion of industry and internal trade (DPIIT) to relook at the FDI policy on this issue.

“For export purposes, if these (rules) could be revisited is something that we are requesting the DPIIT to examine and explore... and this could be one step forward for creating the e-commerce export zones that DGFT and its team has been working on,” Sarangi said.

Regarding initiatives to boost exports through e-commerce, the official mentioned that steps are being taken to address challenges faced by exporters, including smaller ones under the mandatory GST regime.

The Directorate is collaborating with the Department of Revenue to explore the possibility of a scheme similar to the 'composition levy scheme' for smaller players. This could potentially exempt them from mandatory GST until they reach a specified export value threshold.

“Similarly, exports through e-commerce many a time are not getting benefits like duty drawback or DGFT schemes like Remission of Duties and Taxes on Exported Products (RoDTEP) or Rebate of State and Central Taxes and Levies (RoSCTL). So we are now working with Express Cargo Clearance Systems (ECCS) and postal bill of exports to ensure that the shipping bills flow directly so that these kinds of exports also get covered under these kinds of schemes,” he said. 

He added that the DGFT is also working with the Department of Post to ensure that Dak Niryat Kendras and foreign post offices (FPOs) get strengthened and expanded.

The Department of Post has the objective to open 1,000 such Kendras which will work on a hub and spoke model with the FPOs and they are trying to ensure that the export consignments are reached at the quickest possible time, get the customs clearance and are sent abroad. 

(KNN Bureau)