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Six NSW services opening up for faster trade

National single window meant for expediting cargo clearance

DOULOT AKTER MALA | December 18, 2023 00:00:00

A part of National Single Window (NSW) is set to open next month for expediting export-import trade through digital integration of six clearance-providing entities that helps leapfrog port hurdles.

After the opening of the NSW, importers and local manufacturers would get speedy services on release of pharmaceuticals and industrial raw materials, capital machinery, environmental- clearance certificate and different testing certificates from the BSTI.

In the first phase, the National Board of Revenue (NBR) has decided to start Users Acceptance Test (UAT), likely from end of January, of the certificate-licensing and permit (CLP)-issuing agencies.

The entities are the Directorate General of Drug Administration (DGDA), Bangladesh Standards Testing Institution (BSTI), Office of Chief Controller Export and Import, Plant Quarantine Authority, Bangladesh Investment Development Authority (BIDA), Bangladesh Export Processing Zones Authority (BEPZA), and Bangladesh Economic Zones Authority (BEZA), official sources said.

There are 19 such certificate-, licence-and permit-issuing entities related to export-import trade-and it takes a lot of beating for businesses to pass through in foreign trade

Officials involved with the Tk 5.85-billion NSW project have said the NBR would bring all of CLPs under NSW gradually to speed up the export-import clearance from seaports.

A senior Customs official says the NBR has the plan to go live with the NSW in January, to leapfrog the gamut of hurdles.

"Dubai-based tech-giant Webb Fontaine is working on support-module development for integrating the CLPs with the NSW," he adds.

On June 21, 2023, the Customs authority of Bangladesh signed an agreement with Webb Fontaine, one of leading providers of solutions for trade facilitation, powered by world-class technology, including artificial intelligence (AI).

However, economist Dr M Masrur Reaz, Chairman and Founder of the Policy Exchange Bangladesh, finds the move to open up NSW too early as it may not deliver the goods unless integration with all entities completes.

The NBR signed agreement with the Web Fontaine five months ago and the high-end system needs time to develop and operate smoothly.

As such, he suggests that the NBR take time for developing the NSW system to make it sustainable and meet the expectations of traders.

The NSW officials said the company is scheduled to hand over the first tranche of the project to the NBR to identify its challenges through UAT. Once all of the CLPs would get access to NSW, time and cost of import-export trade would go down significantly.

"Usually, importers have to count demurrage for delay in releasing goods as getting clearances from the CLPs takes a long time," the official adds.

The new Customs Act 2023 has kept provision of imposing penalty at a rate of 10 per cent on the payable duty-taxes in case of importers' delay in releasing goods after import.

A Time Release Study (TRS), conducted by the NBR, shows the average time from arrival to release of seaborne cargoes is more than 11 days in Bangladesh, while it is seven days for air freight and over 10 days for land cargoes.

The customs official says customs are not responsible alone for delay in export-import goods as other relevant certificate-issuing authorities are involved with the process. The NSW would be successful once those agencies get prepared for integration with NBR system.

The NBR took the NSW project, involving Tk 5.85 billion, in 2019 and is expected to end on 2026.

A major part of the NSW project would be funded by the World Bank (WB) while the rest Tk 561 million by the government of Bangladesh.

In August 2018, the NBR signed a memorandum of understanding (MoU) with 38 departments and entities to implement NSW. It is providing software and hardware support as supplier to the NBR as per the project deal, a contract price worth US$ 20.65 million or around Tk 2.23 billion.

The revenue board picked the company through inviting international tender earlier for the NSW, one of the largest projects under the NBR, which would help simplify import-export procedures through automation, and cut cost and time of port clearance of goods.

The average processing time for imports is expected to be reduced to 122 hours, and for exports to 88 hours after the NBR opens up the full-fledged window.

Bangladesh submitted its WTO TFA (World Trade Organisation Trade Facilitation Agreement) instrument of ratification in September 2016 with which it committed to implementing 37 measures of facilitating legitimate trade.

The National Single Window is under Article 10.4, which states "members shall Endeavour to establish a single window" to international trade.

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