Govt wants partial waiver of ADB conditionality

The government has sought partial waiver of the policy condition tagged by the Asian Development Bank (ADB) to the release of an aid installment after it missed the deadline for enacting a new customs law.
As per ADB's major policy condition, the government was to frame, finalise and get the Customs Act 2014 through parliament by November 30.
For failing to do it, the lending tranche is destined to lapse as its tenure is up to the yearend and the time runs out fast.         
The customs wing of the National Board of Revenue found it difficult to finalise the crucial law for placing it before parliament within the stipulated time.
The draft customs act could not be finalised during the parliament sessions in the last few months. And the latest sitting is just over.     
A high-powered committee has been formed by cabinet division, chaired by the Principal Secretary to the Prime Minister, to scrutinize the pros and cons of the draft law.
"We have received a set of queries and recommendations from the committee regarding the customs law. Some seven secretaries of the major ministries are reviewing the law," said a senior customs official.
Following the thorough scrutiny, the Economic Relations Division (ERD) under the Ministry of Finance has requested the ADB for partial waiver of policy-condition 1 to enable tranche release before the end of 2014, he said.
The second and final tranche of ADB loan no 2954: SASEC Trade Facilitation Programme is scheduled to be released by this yearend.
"The government is highly committed to finalizing the new customs act 2014 and to expedite formal submission of the draft act to the parliament," writes an ERD letter addressing ADB country director Kazuhiko Higuchi.
The ERD said the government may not be able to complete the procedures within the ADB-set timeline for releasing the aid installment.
"In the meantime, resources will be needed to facilitate implementation of key customs reforms provided for in new customs act," the letter added.
The NBR is set to introduce a new customs act by replacing the existing one from July 1, 2016 with simplified and business-friendly provisions.
The law will be a revised and updated version of the existing law framed way back in 1969.
The draft of the new Customs Act 2014 has already obtained approval, in principle, from the cabinet. The seal of endorsement was given on September 15, 2014.
The customs wing has incorporated a number of business-friendly provisions into the new act under which any of the policy decisions has to be discussed with the businesses and private- sector stakeholders before its imposition.
The new law will have provisions of risk-based customs- management system to expedite clearance of goods. It would also reduce discretionary powers of customs officials and introduce a paperless customs administration.   
The new law will be scripted in Bengali to make it understandable to all. The act has been prepared in line with the international best practices.
The NBR has uploaded the draft customs act on the website after discussions with the stakeholders.
The revenue board says it needs time to prepare infrastructure and build capacities of its officials before its enforcement.
Automated customs clearance system and interconnectivity with the relevant offices would be required to enforce the new customs act successfully.
The draft of the new customs act has been framed in line with the international conventions that the governments have signed so far.
The NBR incorporated rules of international convention and trade treaties into the new act, including the Revised Kyoto Convention, SAFE framework of standard, and trade-facilitation agreement of the WTO (World Trade Organization).
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