DGFT stands for Directorate General of Foreign Trade. It comes under the Ministry of Commerce and Industry of the Government of India. This body is mainly concern with all the import and export that take place from and to India. The Directorate General of Foreign Trade is known as the head of DGFT. After liberalization DGFT was formed in place of CCI&E (Chief Controller of Imports and Exports), which is responsible for all the activities from implementing trade policies to issuing licenses to become a global seller. For every trader, an approved license from DGFT is very crucial. Without it, no individual is allowed to either export or import any of their good across foreign borders.
Implementation of EXIM Policy/ Foreign Trade Policy
The Directorate General of Foreign Trade is the sole body that implements all the policies which are concerned with foreign trade. This comes as the primary role of the body as India is the fastest growing country in trading as well as in population. That is why it becomes a matter of high priority to ensure an adequate implementation of the trading policy.
Implement Foreign Trade Procedures
To complete any task on a large scale, it is important to exhibit everything in a streamlined procedure. The Directorate General of Foreign Trade is responsible for maintaining specific trade procedures to avoid any chaos to the country as well as to the trading industry.
Issues IEC Code to Exporters and Importers
In the present day, we all have our Aadhar Cards as our unique identification ID. Similarly, in an export-import business, an organization or an individual must have an IEC Code. This code is referred to as Import-Export Code. It is a 10-digit number that is issued by DGFT as a unique ID to trade globally. A person can apply to get an IEC code on the DGFT website. The portal is available for everyone who wishes to trade across the globe. It is essential for an individual to have their PAN card because the IEC code is only issued o the people having their Permanent Account Number.
Document and Maintain Classifications ITC-HS Code
India sanctioned the ITC HS code (the International Harmonized System of Coding) to develop and improvise foreign trade. ITC HS code allows several businesses and individuals to select their respective product categories. Not only this, they are allowed to provide the proper descriptions of the goods they want to sell in foreign countries. The Directorate General of Foreign Trade divided the ITC HS code into two schedules- Schedule 1 for imports and Schedule 2 for exports.
Provides Platform for Updating eBRC
Electronic Bank Realization Certificate (BRC) or eBRC is the certificate issued by the banks to the desired exporter. It ensures that the exporters are claiming certain benefits under various schemes of the Foreign Trade Policy. This was one of the initiatives taken by the Government of India to promote paperless trading, and the Directorate General of Foreign Trade has created the electronic platform for BRC.
Provides Information About the Export Policy Schedule
The concept that half-knowledge is dangerous is also applicable in government bodies. Because in foreign trade, if an individual is not fully aware of the rules and regulations, it might cost the business or the person millions of fortunes. That is why to avoid any such situations, the Directorate General of Foreign Trade provides complete information about the everything. Amongst which Schedule 2 that is only concerned with exports are available with full details of the DGFT website.
Grant Export Licenses to Restricted Items
There are many categories that are banned in India to sell, or likewise in other countries. These categories can be beef, leather, oils, etc. To export them outside the country, an individual or the organization need to apply for the license on the DGFT website. The additional licenses are primarily given to the ‘restricted’ items. The Directorate General of Foreign Trade ensures that the exporter can sell the restricted items only in the places where it is allowed.
Promote Trade with Foreign Borders
Globalization is playing a crucial role in every country. In India, it has been a significant part of the development and to maintain foreign relations with all the other countries. The incorporation of DGFT was made to promote such foreign relations and trade. Promoting foreign exchange helps India grow and expand its business venture all across the world by fostering foreign exchange. Foreign trade relation boosts the economy of the respective countries. It facilitates the global growth and also helps countries that are not developed.
Control DEPB Rates
DEPB stands for Duty Entitlement Pass Book. It is an export incentive scheme which is authorized by the Government of India. DEPB Rates are given to the exporters of India. It allows the import of any restricted item like gold accessories, minerals, etc. It is a way of providing a grant of duty against the export credit. DEP allows the exporter to apply for any credit as a specified percentage of the value of exports into a convertible currently. But at the same time, it is necessary to control the DEPB rates, as an overflow of such credits can imbalance the export-import inventories and affect the homegrown and foreign marketplace. For that, the Directorate General of Foreign Trade is the authority who takes care of all these things.
Regulate Transit of Goods
DGFT facilitates a regulated transit of goods. In most cases, when goods are packed and shipped for delivery to the respective countries and do not reach the destination. In such scenarios, DGFT comes to the rescue. It addresses feedback, proper delivery of the goods, resolving the issues that are hampering the trade.
The Directorate General of Foreign Trade is one body but facilitates several importers and exporters simultaneously. The roles and responsibilities of DGFT are not just restricted to the above-mentioned points. It also plays a significant part in the government for all the internal affairs of foreign trade.