The Pharmaceutical Export Promotion Council has urged the Central Government that the war surcharge and scanning fee imposed currently on the air shipment of export goods is an unjustified burden on exporters and these charges have to be withdrawn with immediate effect.
The Council pointed out that at the time of announcement of the Foreign Trade Policy on August 31, 04 for the years 2004-2009, the commerce minister had said that unless the transaction costs were reduced, it would not be possible to meet the objective of reducing the costs and compete in the market.
Further, of late, due to congestion at the Nhava Sheva Port, a heavy backlog of goods pending for shipment has piled up. There also, the port authorities and the CFS operators are levying additional charges which also adds to the cost. In view of the congestion, some exporters would like to divert the cargo by air to see that goods reach their customers in time. But the air freight rates are too prohibitive. Besides, the international airlines had introduced a war surcharge of Rs 7.00 per kg with the outbreak of Iraq war early this year. While the war ended in April, the war surcharge is still being continued by the international airlines, which is really hurting the export interests of the country.
In addition, the Airports Authority of India has levied a scanning fee of Rs 1.50/kg which is charged in the name of security. There is no justification for charging separate fee for scanning the export parcels as scanning should necessarily be covered under handling charges payable to Airports Authority of India. These two un-justifiable levies sap the competitive strength of pharma industry quite badly. Continuance with such levies could hinder the growth of Indian exports and make attaining of the national objective of reaching the level of exports equivalent to 2 per cent share of the global trade difficult, the council accuses.
Among other Industries, the Pharma Industry which ships large volumes by air, happens to be the worst sufferer. The Centre should, therefore, intervene and withdraw the un-justified war surcharge and scanning charges levied by the International Airlines and Airports Authority of India respectively, they demanded.