Handicraft exporters to Iran have got a shot in the arm with the government acceding to their long-pending demand to do away with the requirement for e-BRC (Bank Realisation Certificate) to get benefits under a popular export promotion scheme as banks were not being able to generate the documents for countries in the Office of Foreign Assets Control (OFAC) list.
OFAC countries are the ones against which economic sanctions have been imposed by the US and include Iran, Iraq, North Korea, Belarus, Syria and Cuba.
Payments stuck
Satpal Pugla, an exporter based in Moradabad, said: “A lot of our payments are stuck because of non-fulfilment of the eBRC requirement. We are grateful to the Commerce Ministry for allowing the benefit against another document which is available with all exporters. Hopefully the money will be released to us now.”
Ever since banking sanctions against Iran were re-imposed by the US late last year, handicraft exporters were facing a challenge in applying for the benefit of 7 per cent of export value they were entitled to under the Merchandise Export from India Scheme (MEIS). This was happening as banks were refusing to accept shipping documents presented by exporters shipping to Iran for clearance of GR (guaranteed remittance) form to the Reserve Bank of India and as a result, no bank realisation certificates (BRC) were being issued to exporters.
Without BRC, exporters were not able to claim benefits under the MEIS scheme with their due payment getting stuck. India’s exports of handicrafts to Iran is estimated at ₹500 crore annually.
‘Will enhance exports’
“With this initiative, the exporters are going to get the much-needed MEIS benefits for their exports and it will energise them to continue their efforts towards enhancing exports from the country,” said Rakesh Kumar from the Export Promotion Council for Handicrafts (EPCH). He pointed out that the council had taken up the matter of non-issuance of e-BRC at the highest level in all concerned Ministries including Textiles, Commerce, Finance and also the DGFT and finally action was taken.
As per the trade notification issued by the DGFT, in case a shipment has been made to countries which are in the OFAC list and e-BRC has not been generated by the bank concerned for that specific shipment, then the exporter while making the MEIS application has to submit a declaration to that effect along with a self-attested copy of the proof of payment such as Foreign Inward Remittance Certificate.