The terrorist attacks on Mumbai pose fresh challenges for the Customs. Rethinking on all the customs clearance procedures is now necessary with a view to eliminate all risks of any untoward incidence that can jeopardise the lives of people. The present approach of looking only at revenues and trade facilitation alone will not be enough.
Even now, the role of the Customs is not limited to mere collection of customs duties. It includes enforcing the prohibitions and restrictions under allied laws relating to imports and exports of cargo, postal articles, baggage etc., prevention of smuggling and drug trafficking, international passenger processing and arrival and departure of conveyances.
The Customs man all the legal entry and exit points in the country, besides all the inland container depots and foreign post offices in the hinterland.
All the conveyances i.e. vessels, aircrafts, trains, trucks or camels that bring in cargo have to pass through the Customs checks. The law gives the Customs the right to stop the conveyances, search them, seize them, interrogate the master of the vessel, grant entry inwards and entry outwards and impose penalties in case of any violations. These rights must be used judiciously.
In respect of cargo, the Customs not only need to check the classification, valuation and eligibility to exemption but also need to examine the cargo to find out whether goods imported actually are as per the description given in the documents.
In practice, however, the Customs do not examine all the cargo. Under the Accredited Clients Programme, clearances are granted on the basis of declarations of the importer. Wherever the Risk Management System has been implemented, the computer system picks up at random only a few bills of entry for assessment and examination. The system is far from foolproof.
Inadequacy of manpower and the need to strike a balance between ensuring compliance and trade facilitation has led to examination of import cargo limited to few containers.
But when it is clear that there are fanatic elements abroad determined to find innovative ways to harm the country, it is necessary to take precautions and examine all the cargo. The Customs can ensure that scanners are placed at all the ports, airports, foreign post offices and inland container depots. Almost all import cargo must be subject to scanning.
The UN has put in place a system whereby all the cargo bound for that country is examined by authorised agencies before the goods are shipped. Even a country like Indonesia insists on pre-shipment inspection.
The Indian Customs can also open up an optional window of pre-shipment inspection by reputed agencies, so that there is reasonable assurance that the goods are examined even before they are put on vessels bound for India.
Such pre-shipment inspection will also ensure that goods get cleared immediately after landing and that our ports do not get congested.
Any insistence on pre-shipment inspection and/or compulsory scanning and examination of cargo will mean that the transaction costs will go up and there will be delays. But, better to follow the example of US and take precautions rather than regret afterwards.
Banks should also diligently follow the Know Your Customer guidelines of the Reserve Bank of India and exercise greater care while handling inward or outward remittances and report transactions of suspicious nature.
