Reports that the banks and the Reserve Bank of India (RBI) are forwarding cases of non-realisation of export proceeds to the Enforcement Directorate (ED) have created “avoidable panic” among even genuine exporters who have submitted their documents to the banks, according to an apex exporters’ body.
“We have received several complaints from our members about the banks not issuing documents about the remittance receipts even after submission of all the required papers,” Ravi Sehgal, chairman of EEPC India (Engineering Exports Promotion Council of India) said in a statement on Monday.
“Thus, exporters are facing a double whammy — losing refunds like drawbacks and the possibility of ED action.”
Mr. Sehgal added that while the EEPC India has been regularly advising its members to reconcile their remittances records, several banks are not issuing the clearances, especially when it came to shipments to countries such as Syria, Iran, and Sudan.
Global headwinds
“At a time, when exports are facing global headwinds like slowdown in the U.S. economy, uncertainty of Brexit and the trade war between the U.S. and China, the RBI and the government should be dealing with issues like remittances in a friendly manner,” Mr. Sehgal said.
He said that India’s overall merchandise exports remained static, logging less than 1% growth in November this year.
“The last thing our exporters want is the procedural hassle and any enforcement action,” he added.
