For city hand tool exporters, who are already losing ground to their Chinese counterparts due to lack of technological advancement, over pricing of export items by some exporters to grab incentives has posed as a new threat. As a result genuine exporters are striving to stay in competitive global market.
In a recent meeting by the Central Excise and Customs Department and Directorate General of Foreign Trade (DGFT), some of the leading hand tool exporters raised the issue of 'malpractice' adopted by some 'unscrupulous' exporters.
Chairman of the hand tool panel of Engineering Export Promotion Council (EEPC) and leading exporter, MK Bhandari, demanded prompt action by the department concerned to curb the menace of 'fake'export.
An exporter, namely, Ashwani Kumar said over pricing of the export items enables such exporters to earn at least three times more export incentives and later they further sell such items to international buyers at much lower price to outsmart the genuine exporters.
Explaining the operation of 'unscrupulous' exporters, Kumar said, "Some exporters have their agents at Dubai and they export the hand tools, but show them as other costly products with the help of customs officials, to claim the export incentives."
"Once the items reach Dubai, agents of the exporters after making the payment of export items through legal channels, get the margin money back from through hawala transactions," Kumar said.
He added that then the products are further exported to European countries at lower price, which is not viable for any genuine exporter.
A noted exporter of the city, namely, Suresh Sharma said there is an urgent need to curb such menace, as inaction of the authorities, is not only discouraging the genuine exporters, but more and more 'fake' exporters are adopting the practice for lucrative returns.
"Role of custom officials is also very dubious, as without their assistance, such exporters cannot sustain their business," Sharma added.
Deputy commissioner of customs department, Vijay Bahadur admitted that 'fake' export has been growing and said, "We have instructed the apex body of the hand tool exporters to provide us the price range of all their products, so that over invoicing could be tackled by the department according to the provided list."
"Once we get to know the price range of particular product, we can thoroughly check the suspicious containers," he added.
Bhandari added that price list of each and every product is being finalised and very soon, it will be submitted to the customs department.