Govt notifies Subrahmanyam Committee terms

NEW DELHI, AUG 4: The Government today issued detailed guidelines for import of second-hand capital goods, including allowing import of m...

NEW DELHI, AUG 4: The Government today issued detailed guidelines for import of second-hand capital goods, including allowing import of machinery upto five-year old without license.

As per the notification, which is expected to give a boost to infrastructure and modernisation of textile industry, machinery older than five years and less than 10 years, would be allowed for imports after consideration by a inter-ministerial licensing committee set up under Directore General of Foreign Trade DGFT. Machinery over 10 years old would not normally be allowed except in the case of heavy equipment in the infrastructure and core sector industries.

An official press release said here that for applications to import capital goods older than five years and less than 10 years, the committee would consider comparative advantages and benefits of such imports vis-a-vis new capital goods.

It would also mean that the committee would see if such goods were available in the domestic market. The imported capital goodswould have to conform to the acceptable environmental and industrial safety norms. Apart from the criteria mentioned in the notification, the committee might fix any other criteria it deems necessary, it said.

The release said in view of problems faced by importers, who had taken substantive steps for import of second hand machinery before March 31 this year or under special circumstances, the shipments might be allowed by the committee if they did not conform to the notified guidelines.

The substantive steps of the importers which would be considered by the committee are part or full payment made by the importer, orders negotiated or finalised, firm commitment for import such as forward contract being made and payment for dismantling of capital goods had been made.

Automobile manufacturers, who had signed the memorandum of understanding with DGFT as per the mandatory automobile policy, would also be covered under the substantive steps category, the release said.

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The committee would also considercases in which the Export Promotion Capital Goods EPCG committee took a decision to grant second hand EPCG licenses but the permits were not issues.

In such cases, applicants would have the option of converting their EPCG applications into restricted import license and for that they need to submit only a revised application, the release said.

Future applicants for second hand capital goods import should take into consideration the prescribed criteria before applying for permission, it added.