How Indian Customs Department has improved its' Dwell Time?

The Indian Customs Department has made significant strides in improving the Dwell Time (the amount of time a cargo stays at the port between arrival and clearance) in recent years. Dwell time is an important factor in determining the efficiency of port operations and logistics, as longer dwell times result in delays, higher costs, and less efficient trade operations.

By reducing dwell time, Customs helps in enhancing the flow of goods and promotes smoother international trade.

Here’s how the Indian Customs Department has improved its Dwell Time:

1. Implementation of the “Direct Port Delivery (DPD)” Scheme:

• The Direct Port Delivery (DPD) scheme was introduced to enable importers to clear their goods directly from the port without the need for them to go through the Customs clearance process at the Inland Container Depots (ICDs).
• This initiative cuts down the intermediate steps and helps in reducing the time spent on the clearance process, thus improving dwell time and speeding up the supply chain.

2. Facilitation through “Faceless Customs”:

• The Faceless Customs initiative, launched under the India National Single Window System (NSWS), minimizes physical interaction and ensures automated processing of customs clearance procedures.
• It has streamlined processes such as Assessment, Examination, and Audit by moving them online, allowing faster clearances, reducing the scope for delays, and eliminating human intervention in routine checks.

3. “Single Window Interface for Trade (SWIFT)”:

• The SWIFT platform allows traders to submit all their required documents through one portal to multiple government agencies (such as Customs, DGFT, and others) for clearance.
• This reduces the time spent waiting for approvals from different government bodies and accelerates the overall clearance process at ports, reducing dwell time.

4. Risk Management System (RMS):

• Customs uses the Risk Management System (RMS) to select shipments that require further inspection, based on risk profiles. This system automates cargo clearance and flags high-risk consignments for physical inspection while letting lower-risk shipments go through faster.
• This selective approach prevents unnecessary delays and helps in speeding up the clearance process for most shipments.

5. Paperless and Digital Processes:

• The e-filing and digitalization of customs documentation and clearance procedures have been implemented to eliminate paperwork and reduce the time-consuming manual processes that previously contributed to delays.
• The Electronic Data Interchange (EDI) system has been adopted, allowing businesses to file import/export declarations electronically, which accelerates the process and reduces paperwork-related delays.

6. Automated and Fast-Track Clearance for Trusted Traders:

• Trusted traders, who have been vetted for their compliance with regulations, now benefit from fast-track clearance and lesser scrutiny. These traders can avail of quicker processing, which helps in reducing the overall time taken for cargo to clear through customs.
• The Authorized Economic Operator (AEO) program is one such initiative that offers a special status to businesses that demonstrate high compliance and operational standards.

7. 24/7 Customs Operations at Major Ports:

• Customs authorities have extended their working hours and introduced 24/7 clearance at major ports like Jawaharlal Nehru Port (JNPT) and Chennai Port. This ensures that goods can be cleared at any time of the day, avoiding delays caused by operating only during business hours.

8. Smart Inspection Systems (X-Ray, Scanners, etc.):

• To speed up the inspection process, Indian Customs has introduced advanced scanning and inspection technologies such as X-ray machines and Non-Intrusive Inspection (NII) systems. These technologies help to quickly examine cargo without having to open containers, reducing physical inspection time and improving clearance efficiency.

9. E-Clearance of Goods under “Authorised Dealer” (AD) Monitoring:

• The Authorized Dealer (AD) monitoring has been enhanced through electronic systems that integrate the customs department with banks and financial institutions. This ensures smoother approval processes for financial documentation, avoiding delays linked to the payment process.

10. Customs Modernization and Capacity Building:

• The Customs Department has focused on improving the skills of officers, offering training programs to enhance their technical knowledge and efficiency in handling clearance procedures. This has led to more efficient management of the port's clearance process, helping to improve overall dwell time.

11. Public-Private Partnerships (PPP):

• The Indian Customs has worked closely with port operators, logistics companies, and other stakeholders through Public-Private Partnerships (PPP) to streamline processes and encourage better infrastructure management at ports. These collaborations have improved the speed of cargo handling and documentation, reducing unnecessary delays.

METHODOLOGY ADOPTED FOR DWELL TIME REPORT

Dwell time is the measure of the time elapsed from the time the cargo arrives in the port to the time the goods leave the port premises after all permits and clearances have been obtained. For Indian Customs, an important method to evaluate Customs clearance procedures between the arrival of cargo and its release, is to measure the time taken at each stage. This helps in identifying both the problem areas and potential curative actions to enhance the efficiency in clearance process. Accordingly, the dwell time of the import cargo is analysed every month and displayed for select Customs sites which handle huge volume of cargo, covering sea, air, and land ports: Air Cargo: Bengaluru Customs (INBLR4) Chennai Air Cargo (INMAA4) Delhi Customs (INDEL4) Mumbai Air Cargo (INBOM4) Sea port: Chennai Customs (INMAA1) JNCH Customs (INNSA1) Inland Container Depot: ICD Tughlakabad (INTKD6).

The methodology adopted is as follows:

• The average time taken from the time of arrival of cargo to the customs out of charge is calculated on the basis of Arithmetic Mean.
• Dwell time assessment is done separately for Green channel (Facilitated) and Red Channel (Non-facilitated) cargo.
• For this purpose, cargo which is not subjected to Customs examination is considered as Green Channel cargo.
• For the purpose of dwell time analysis, the cargo that has arrived during a calendar month (i.e. based on date of entry inward) is considered.
• For the purpose of the analysis, ex-Bond BEs and outlier cases of consignments held from clearance for more than 30 days due to non-compliance issues, court matters etc., are excluded. For ICDs, the Cargo Arrival Time at the ICD is considered as the Arrival Time.
• For BEs filed in advance i.e, under provisio 3 to section 46 of Customs Act 1962, the time of arrival of cargo is considered as the time of submission.

Dwell time is the measure of the time elapsed from the time the cargo arrives in the Customs Station till the clearance is provided by Customs.

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Source:https://www.cbic.gov.in/entities/cbic-content-mst/MjEwMDA%3D, February 2023

Results & Impact:

As a result of these initiatives, the dwell time at major Indian ports has improved significantly. For instance:

• The average dwell time at JNPT has decreased from 3-4 days to less than 2 days.
• The introduction of initiatives like DPD and Faceless Customs has led to faster customs processing, with Direct Port Delivery handling around 30-40% of total containerized cargo at some major ports.

Conclusion:

The Indian Customs Department has implemented several measures to significantly improve dwell time, benefiting both traders and the overall economy. Through technological advancements, streamlined procedures, and better coordination between different stakeholders, Customs has been able to reduce bottlenecks and make the clearance process smoother and faster. This, in turn, has enhanced the competitiveness of Indian ports, reducing costs for businesses and making international trade more efficient. As India continues to modernize its customs operations, it is expected that dwell time will continue to decrease, making the country more attractive for global trade.