1-Dec-2019: 6 European nations join INSTEX
Paris, London and Berlin welcomed six new European countries to the INSTEX barter mechanism, which is designed to circumvent U.S. sanctions against trade with Iran by avoiding use of the dollar.
As founding shareholders of the Instrument in Support of Trade Exchanges (INSTEX), France, Germany and the U.K. warmly welcome the decision taken by the governments of Belgium, Denmark, Finland, the Netherlands, Norway and Sweden, to join INSTEX as shareholders.
The Paris-based INSTEX functions as a clearing house allowing Iran to continue to sell oil and import other products or services in exchange. The system has not yet enabled any transactions.
Washington in 2018 unilaterally withdrew from the international agreement governing Iran's nuclear programme and reinstated heavy sanctions against Tehran.
The accession of the six new members “further strengthens INSTEX and demonstrates European efforts to facilitate legitimate trade between Europe and Iran”, France, Germany and Britain. It represents “a clear expression of our continuing commitment to the Joint Comprehensive Plan of Action” — the 2015 Iranian nuclear deal.
Israel criticised six new European members of the INSTEX barter mechanism with Iran, saying it encouraged Tehran's repression of protests.
What is INSTEX, the Instrument iN Support of Trade Exchanges, and who are its shareholders?
INSTEX SAS (société par actions simplifiée) was founded in 2019 as a Paris-based company governed by French law. As of July 2021, it has nine sovereign owners:
- Republic of France
- Federal Republic of Germany
- United Kingdom of Great Britain and Northern Ireland
- Kingdom of Belgium
- Kingdom of Denmark
- Kingdom of the Netherlands
- Kingdom of Norway
- Republic of Finland
- Kingdom of Spain
- Kingdom of Sweden
INSTEX is expecting more sovereign states to join in the future.
What is the purpose of INSTEX?
The goal of INSTEX is to facilitate legitimate trade with Iran in light of challenges faced by European market participants who wish to continue trading in and with Iran in an unobstructed manner. At present, INSTEX focuses on humanitarian trade between Europe and Iran, broadly encompassing food, agricultural equipment, medicine, and medical supplies as well as items required to produce, create, package, transport, preserve, and ensure humanitarian goods arrive with their end-users in a satisfactory manner.
How does INSTEX operate?
INSTEX functions as a clearing house that facilitates the exchange of payment transactions between Europe and Iran. In coordination with our Iranian counterpart, the Special Trade and Finance Instrument (STFI), INSTEX settles mutual claims and liabilities by means of clearing debts (forfaiting) within a ‘closed loop’ financial system that minimises cross-border payments between Europe and Iran. Direct payments between Iran and Europe occur to the extent that periodic imbalances arise during our imports-exports. INSTEX and STFI are exploring solutions to allow for the further expansion of trade activity.
4-Nov-2019: ICEDASH & ATITHI launched for improved monitoring and pace of Customs clearance of imported goods and facilitating arriving international passengers
Union Minister of Finance and Corporate Affairs, Smt Nirmala Sitharaman unveiled two new IT initiatives – ICEDASH and ATITHI – for improved monitoring and pace of Customs clearance of imported goods and facilitating arriving international passengers by electronic filing of Customs baggage and currency declarations.
Finance Minister lauded the measures taken by CBIC to leverage technology for providing better taxpayer services. She was particularly appreciable of the work being done in the Network Operation Centre and Security Operation Centre. Finance Minister also mentioned that the significant improvement in India’s global ranking in the Trading Across Border is in no small measure on account of the IT and other reforms carried out by CBIC. She also expressed optimism that both ICEDASH and ATITHI would be key drivers for further improvement especially as they reduce interface and increase transparency of Customs functioning. She added that ATITHI would in particular create a tech savvy image of India Customs and would encourage tourism and business travel to India. Finance Minister further urged the officers to develop IT based insights for focused policy making.
Shri Anurag Thakur commended the work being done by officers of DG Systems, CBIC and noted that the ATITHI app will facilitate hassle free and faster clearance by Customs at the airports and enhance the experience of international tourists and other visitors at our airports. He added that the CBIC must strive to use technology in each sphere of its activity and while facilitating genuine business it must identify ways to detect and stop frauds especially in GST.
About ICEDASH & ATITHI :
- ICEDASH is an Ease of Doing Business (EoDB) monitoring dashboard of the Indian Customs helping public see the daily Customs clearance times of import cargo at various ports and airports. With ICEDASH, Indian Customs has taken a lead globally to provide an effective tool that helps the businesses compare clearance times across ports and plan their logistics accordingly. This dashboard has been developed by CBIC in collaboration with NIC. ICEDASH can be accessed through the CBIC website.
- With ATITHI, CBIC has introduced an easy to use mobile app for international travelers to file the Customs declaration in advance. Passengers can use this app to file declaration of dutiable items and currency with the Indian Customs even before boarding the flight to India. ATITHI is available on both, iOS and Android.
16-Sep-2019: Commerce and Industry Minister Launches Common Digital Platform for Issuance of Electronic Certificates of Origin
Union Minister of Commerce & Industry and Railways, Piyush Goyal and Minister of State for Commerce & Industry, Hardeep Singh Puri, launched Common Digital Platform for Issuance of electronic Certificates of Origin (CoO) in New Delhi.
This platform will be a single access point for all exporters, for all FTAs/PTAs and for all agencies concerned. Certificate of Origin will be issued electronically which can be in paperless format if agreed to by the partner countries. Authorities of partner countries will be able to verify the authenticity of certificates from the website. Further, it provides administrative access to Department of Commerce for reporting and monitoring purposes. The benefits of this platform will be:
|
New Platform |
Existing Process |
|
The issuance process is electronic, paperless and transparent |
Current process requires the exporter to visit the agency thrice for each certificate |
|
Real-time tracking of FTA utilization at product level, country level etc. |
Real-time tracking is not possible as data is fragmented across various agencies |
|
Electronic Certificate of Origin issued |
Physical Certificates of Origin issued |
|
Possible to electronically exchange CoO with the partner countries |
Electronic exchange of CoOs not possible |
|
Reduces transaction cost and time for the exporters |
Current processes take more time and cost |
Exporters may register on this platform and apply for CoOs to any of the designated agencies. EIC and its agencies are already on-boarded. Other agencies are in the process of registering on the platform. The on-boarding process is only for the purposes for payment integration so that the application fees may flow to the respective agencies.
The platform will be made live for FTAs in a phased manner as per the concurrence of the concerned partner countries. Various territorial divisions have already informed their partner countries. We are scheduled to start with the India-Chile PTA.
Further, once the partner countries agree to an electronic data exchange, the CoOs will be electronically sent to the Customs of the partner countries. After this, there will not be any need for physical CoO copy, saving transaction cost and time for the Indian exporters.
India has 15 Free Trade Agreements (FTAs)/ Preferential Trade Agreements (PTAs) with various partner countries under which Indian exporters avail reduced import tariffs in the destination country. In order to avail this benefit, the exporters must provide a preferential CoO. About 7 lakh certificates are issued annually by designated agencies. These verticals certify that exported goods are made in India. These certificates are issued by designated agencies in India after vetting of the rules of origin criteria as per the respective FTA/PTA. Some designated agencies for CoO issuance are EIC, Directorate General of Foreign Trade (DGFT), Marine Products Export Development Authority (MPEDA), Textile Committee and Tobacco Board.
At present preferential Certificate of Origin is issued from the various notified agencies around the country through manual processes. A new common digital platform for issuance of electronic preferential CoOs has been conceptualized to address various challenges in the current process. The platform has been designed and developed by DGFT and Regional & Multilateral Trade Relations (RMTR) Division, Department of Commerce, Ministry of Commerce and Industry, Government of India.