28k tonnes Export by Rail to Bangladesh held up, Decision Delay on Relaxation of Ban to Neighbouring Countries

[ABS News Service/09.06.2022]

As many as 12 railways rakes, carrying around 2,400 tonnes of wheat each in a total of 504 wagons, headed for Bangladesh, have been stranded for the past several days following imposition of severe control on its export last month by the government. The exporters, who are sending these consignments to the neighbouring country, are waiting for registration certificates (RC) from the regional authorities (RA) under the Directorate General of Foreign Trade (DGFT).

Sources in the railway ministry said they are facing a precarious situation of stranded wagons when there is a huge requirement of these for transporting other essential commodities by rail. Such wagons are also used for transport of other items, including fertilizer. “Efforts are being made to expedite the process so that the trains can start running and we get back the empty wagons to carry other materials,” said a source in the railway ministry.

Corroborating this, government sources said all Letter of Credits (LCs) are being verified by the advising banks to eliminate any possibility of fraud and after that the RCs will be issued.

On May 30, the DGFT had issued guidelines to all RAs, directing them for strict compliance before their issuance to the eligible exporters in order to prevent fraudulent practices, such as submission of false documents by shady traders. It had said that the RAs will do a physical verification of all LCs, whether already approved or under process and for that if necessary, help of a professional agency may be taken. While doing physical verification, validation or endorsement of recipient banks may be ensured.

Soon after announcing the curb of free export of wheat on May 13, the DGFT had asked the RAs for rigorous adherence before issuing RCs to qualifying exporters. These instructions were issued after receiving information from sources that some unscrupulous exporters were submitting false back-dated LCs with dates of issuance on or before May 13 for RCs.