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Plea to withdraw Customs notifications

By Our Special Correspondent

KOCHI Aug 7. The Cochin Special Economic Zone Industries Association has demanded the withdrawal of two recently announced Customs notifications (52 and 53/2003 ), which, it fears, would result in putting the economic reforms in the backburner.

If the regulations are implemented, an employee working in the SEZ wearing a `mangalasuthra' or wedding ring could be charged with smuggling gold, everytime, he/she enters or leaves the zone, said the secretary, Thomas Phillip. The same could be said for all personal goods like watches, spectacles, chains, bracelets, lunch packets, etc. Goods, including motor vehicles for personal use of executives and workers of SEZ units, shall not be admitted without payment of duty, the regulation stipulates. It also says that written permission is required to be obtained from the Customs authorities for items that need to be carried in and out frequently.

Regarding supply of goods into the zone, the association alleged that the bureaucracy had equated purchases of SEZ units from the country with exports to a foreign country, and have asked for filing of a Shipping Bill. It is a fact that only a dealer with Import and Export Code can export goods. This eliminates a majority of the trading community in the country from who SEZ units make their domestic purchases. "Even if an SEZ unit wants to buy a copy of the Customs Act from a bookshop, they would have to ask the bookshop to file a shipping bill to get it into the zone (or file one on behalf of the book-seller). There would be confusion when shipping bills have to be filed for pens, pencils, papers, stationery, spares, consumables, bulbs, brooms, etc., laments Satish Paul, who is one of the entrepreneurs in the zone here.

The amended rules also stipulate that to claim export benefits, an Indian company has to rely upon foreign currency. One has to pay in foreign currency for the items a SEZ unit purchases from within the country in order to claim export benefits. This is cumbersome and costly, the association office-bearers said.

They demanded that these rules be put off till at least the next financial year. The association will write letters to the Union Finance and Commerce Ministers and also take up the matter with the export promotion council for EOUs and SEZs in the country.

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