Business & Policy | News & Insights

DGFT: Commerce Ministry Aims to Grant 20,000 Status Holder Certificates to Exporters in the Current Year

Published: November 16, 2023
Author: TANVI_MUNJAL

In a major development towards streamlining the process of issuing exporter status certificates, the Commerce Ministry is gearing up to release approximately 20,000 such documents by the end of this year, according to a high-ranking official on Wednesday.

Santosh Kumar Sarangi, the Director General of Foreign Trade (DGFT), expressed his excitement about this significant spike in certificate issuance. Currently, more than 40,200 status-holder certificates have been distributed. Sarangi disclosed that around 2,000 applications are currently under scrutiny due to the applicants’ previous track records. Nonetheless, he assured that these applications would ultimately be approved. By the year’s end, the automated process is predicted to recognize roughly 20,000 status holders, Sarangi informed reporters.

Last month, the DGFT declared that the issuance of exporter status certificates would be based on accessible electronic data, thereby eliminating the need for traders to apply for recognition. These certificates offer various benefits, including simplified procedures under the foreign trade policy (FTP), priority customs clearance on a self-declaration basis, and exemption from compulsory bank guarantees for FTP schemes.

Applicants falling under the ‘risk’ category will face more extensive scrutiny. Exporters who default on their export obligations are assigned this label. The status certificate will now be granted by the IT system, relying on data from the Directorate General of Commercial Intelligence and Statistics (DGCIS) regarding merchandise exports, as well as other risk parameters. Previously, exporters had to submit an online application, including an export certificate from a chartered accountant, to obtain the status certificate. The DGFT Regional Offices would then issue the certificate within three days.

Under the new system, exporters are not required to submit applications, and certification is automatically provided every August based on DGCIS’s annual export figures. Exporters eligible for a higher status due to additional export data can apply for a status modification online at a later date. Notably, the most significant increase in status certification is observed in the 1-Star category, which necessitates an export performance of at least USD 3 million in the preceding three financial years, as well as the current financial year’s first three months.

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