Automation of custom clearance in Northeast

 Equipping the Land Custom Stations (LCS) in the Northeast region with Electronic Data Interchange (EDI) systems is a laudable initiative to boost India’s cross-border trade and commerce with neighbouring countries. The EDI enables faster processing of documents submitted or received by traders, transporters, and regulatory agencies for customs clearance for export or import consignment, as documents are processed online on a real-time basis. Driven by Act East and Neighbourhood First policies, India’s trade with Bangladesh and Bhutan through the northeast region has significantly increased in recent years. This led to an increase in the volume of documents processed at LCS in the region, and automation of customs processes had become an urgent necessity. The region has 44 LCSs spread in seven states: Assam, Meghalaya, Tripura, Mizoram, Manipur, Arunachal Pradesh, and Sikkim. The Central Board of Indirect Taxes and Customs (CBIC) has converted the non-EDI LCS at Ghasuapara, Bholaganj, Shellabazar, Borsora, Khowaighat, Baghmara, Golakganj, Karimganj, and Dawki along the Indo-Bangladesh border and Zokhawthar along the Indo-Myanmar border to EDI-integrated LCS. The CBIC installed VSAT at several locations, as these LCSs are remotely located in areas without mobile networks or optical fibre coverage. The Single Window Interface for Facilitating Trade (SWIFT) is a key component of the Indian Customs EDI System that allows importers and exporters the facility to lodge their clearance documents online at a single point, and they are not required to physically approach the customs regulatory agencies for obtaining permissions. This will facilitate the ease of doing business in LCS in the region for trading partners. Global trade is highly competitive, and no exporter or importer can afford to waste time getting customs clearance and keep their consignments stuck in a customs station for a longer duration than estimated or anticipated. In such a situation, the trader prefers to explore alternative export and import markets through customs points, which are better equipped and facilitate faster clearance of customs papers. Bangladesh’s allowing access to its Chittagong and Mongla seaports for export trade by exporters in the northeast region has led to a revival of the region’s access to sea ports. Automation in the LCS and Integrated Check Posts (ICPs) in the region will bolster efforts by the central and state governments to unlock the trade potential of the strategic region. Bangladesh and Bhutan are also strengthening bilateral trade through the northeast region. The EDI will attract more exporters and importers to use the LCS in the region, which provides a geographic advantage of reduced travel time and reduced transportation costs compared to those long-distance LCS through the West Bengal-Bangladesh border. Political turbulence in Myanmar and violent clashes in Manipur have led to disruptions in trade through the ICP at Moreh in Manipur and the LCS at Zokhawthar in Mizoram and cast a shadow of uncertainty over the northeastern region’s dream of economic integration to an open and vibrant economy in Southeast Asia under the Act East policy. The sooner the situation on both sides of the India-Myanmar border normalises, the better for the region. Proposed fencing of the India-Myanmar border and suspension of the Free Movement Regime are aimed at preventing illegal activities such as smuggling, proliferation of small arms by anti-Indian forces, and illicit supply of narcotics and contraband items by drug trafficking and criminal gangs. On completion of the border fence, it will help convert illegal informal trade, which does not bring any revenue to India or its states in the region bordering Myanmar, to formal trade through the ICP and LCS. The erection of barbed wire fences and tighter border guarding by Border Security Force troops along the Assam-Bangladesh border has helped India foil many attempts by criminal gangs to smuggle contraband items to the region or smuggle out cattle. On the other hand, modernization of LCS has attracted exporters and importers to take advantage of improved transborder connectivity pushed in the region in a big way by India to increase formal trade through international borders between the two neighbouring countries. Customs authorities taking the initiative to educate entrepreneurs in the region on the documentation process for necessary clearance from regulatory agencies can go a long way in nurturing and fulfilling their dream of becoming exporters and contributing to the local economies of their state. While infrastructure and logistics for physical and digital connectivity are crucial for boosting cross-border trade and commerce, exports from the northeastern region can be increased only when the region produces exportable surpluses and quality goods and services. The farmers will focus on growing more and exportable quality grain, pulses, vegetables, fruits that have high demand in export markets only when traders place the demand and also offer to pay premium prices for their produces. The benefits of automation at LCS in the region will be optimal when farmers, producers, and entrepreneurs are aware of the transformation in cross-border trade and commerce that is initiated by the customs authorities for ease of doing business.