India aims to become the world’s most efficient and trusted trade hub by increasing the involvement of authorised economic operators (AEOs) and integrated free zones, according to Revenue Secretary Sanjay Malhotra. Speaking at the Global AEO Conference, Malhotra highlighted the country’s commitment to setting new standards in trade facilitation and global connectivity.

Technology and trust are crucial for India’s revenue department, Malhotra noted. He emphasised expanding the Mutual Recognition Agreement (MRA) programme to include more regional and bilateral partners. This expansion is part of India’s strategy to enhance trade relations globally.

Focus on Technology and Automation

India has embraced technology in both direct and indirect tax administration. Most services, such as appeals, refunds, and payments, are now available online. Malhotra stated that India generates billions of bills of entry and shipping bills annually, a task impossible without technological support.

Efforts are underway to automate all ports across India. Of the 20 major ports, 17 are already fully automated. The goal is to make all services at all ports available online at all times, further streamlining operations.

AEO Programme Expansion

The AEO programme has expanded significantly in recent years as part of a trust-based strategy. Approximately 6,000 entities have been recognised under this programme, accounting for 37% of bills of entry. This initiative helps reorganise and re-engineer the tax system based on trust.

The AEO programme operates under the World Customs Organisation’s SAFE Framework of Standards. It is a voluntary compliance initiative that enhances cargo security through cooperation with key stakeholders in the international supply chain, including importers, exporters, logistics providers, and customs brokers.

International Collaborations

India’s AEO programme began in 2011 and was strengthened in 2016. It is implemented by the Directorate of International Customs under CBIC. Through MRAs, AEO status is mutually recognised between partners, facilitating reciprocal trade benefits.

India has signed Joint Action Plans (JAP) to establish MRAs with countries like Uganda, East African Community, South Africa, Japan, Bahrain, Singapore, New Zealand, the UK, Belarus, and BRICS nations. During the conference, a JAP with Brazil was signed to initiate an MRA.

Malhotra assured India’s support in developing robust AEO programmes in countries with limited capabilities. He stressed that AEOs play a vital role in enhancing trade efficiency through trust-based strategies.