E-Sealing containers through RFID: CBEC’s new technology directive

Technology has integrated itself into the very DNA of modern businesses, and today, there’s not a single opinion, article or discussion about the future of business that is made without discussing technology. In that context, the CBEC has taken this impending future into account and created a new directive utilising E-sealing through RFID technology to speed up the logistics infrastructure and process in India.

The Directive

The CBEC has issued a directive ordering the implementation of electronic sealing of containers under the the self sealing procedure through the use of RFID e-seals.
As per the current situation, exporters need to have a jurisdictional officer present during the cargo stuffing, supervising the procedure, which also incurs the MoT charges and adds a lot of time to the whole procedure.

The Solution

The sheer logistical challenges associated with this current procedure, when analysed brings a lot of friction to the whole process of container transport, causing delays by dependence on directors’ presence, which may be subject to their own limitations in terms of availability, access and time allocation. This in turn, severely drives up costs, making the procedure all the more taxing.

The Technology behind it
RFID e-seals are the modern standard in container sealing, along with other benefits like an added layer of security and better monitoring and data capturing abilities for the exporters. It comes in the form of fixed readers and hand held readers.

Given that all aspects of the container sealing process will now be digital, the data mining opportunities allows a whole new industry to be formed, creating potentially millions of jobs in the process. Add to that, the idea of every shipment being indexed, with specific details on record give exporters the ability to extract and analyse terabytes of data every day, which can help derive insights for daily optimisation and even shape policy for the industry in general.

 

Implementation

Such a change in process does not happen overnight, and the board has rightly come to this new directive after consultation with vendors across India to better handle the preparedness to adapt this process. Through these discussions, it’s been learnt that Chennai port is already using fixed readers to monitor the movement of trucks from CFSs to the port. Kolkata is said to have received hand held readers along with all the ICDs in the NCR region. Outside of this, handheld readers have been actively dispatched to peer 50 custom stations including JNCH, Mumbai, Mundra, Pipavav, Hazira etc.
To facilitate this new direction, The Commissioner of Customs, ICD, Patparganj and Kolkata have already run a familiarisation program for the officers.

Who must adopt?

As per circulars 26/2017 and 36/2017, the following classes of exporters have been obligated to adopt this directive:

(a) exporters already enjoying the facility of self-sealing after having been

approved by jurisdictional formations under the erstwhile procedures;

(b) exporters who have hitherto been availing of supervised sealing and have

been automatically entitled to avail of self-sealing using RFID e-seals, without

having to expressly seek any permission/approval of the jurisdictional

commissioner for this purpose;

(c) AEOs, regardless of whether they were self-sealing or undertaking

supervised sealing, have also been entitled to avail of the new procedure;

(d) Lastly, all exporters have been extended this facility subject to their filing

GST returns but after seeking permission for self-sealing from the jurisdictional

Commissioner as per procedure prescribed under para 9(iii) of circular

26/2017-Cus dated 1st July 2017.

Conclusion
Given India’s strong rise in the global business community, such changes to ease the process and improve the general infrastructure of major industries like Logistics is a welcome move from the CBEC. For more information, you can read the specifics of the directive issued by the Central Board of Excise and Customs here.

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