Commerce Minister does away with ‘origin of goods’ proof for Repayment
Exporters who import goods and ship them to Iran will not be required to produce ‘goods of Indian origin’ certificate
New Delhi: Exporters who import goods and ship them to Iran after value-addition will not be required to produce ‘goods of Indian origin’ certificate for making rupee payments, the Commerce Ministry has decided.
It has directed UCO Bank, entrusted with handling rupee payment to Indian exporters to Iran, not to insist on the ‘Goods of Indian Origin’ certificate.
“The Department of Commerce holds the view that it is not necessary to examine ‘origin of goods’ as long as the exports are permissible by the export regime of the Government of India,” Commerce Ministry said in a letter to UCO Bank.
“Therefore, you (UCO Bank) are requested to permit rupee payment against export to Iran by Indian exporters without insisting on the condition of ‘Goods of Indian Origin’,” it said.
The certificate establishes evidence on origin of goods imported into a country. It is essential for exporters to prove where their goods come from and therefore stake their claim to whatever benefits goods of Indian origin may be eligible for in the country of exports.
In June, India had allowed export of imported products to the US sanctions-hit Iran under the rupee payment mechanism provided 15 per cent value addition takes place in the country.
The move was aimed at proper utilization of the rupee payments accumulated in UCO Bank for oil purchased from Iran.
Indian exports to Iran rose 39.4 per cent to USD 3.36 billion in 2012-13 from USD 2.41 billion in 2011-12, on account of concerted efforts made by both countries.
The US has imposed economic sanctions on Iran alleging that it is conducting nuclear activities, and most companies in the West have boycotted the Persian Gulf nation.
Iran had in July agreed to take payments for oil it sells to India entirely in rupees after US and western sanctions blocked all other payment routes.
But shortly after a brief trial of the mechanism, it reverted to the old system of taking only 45 per cent of the payments due in rupees.