Government of India
	Ministry of Finance
	Department of Revenue

ELECTRONIC DATA INTERCHANGE

What is EDI ?

Electronic Data Interchange (EDI) is generically defined as the computer-to-computer exchange of business information through standard interfaces. It can also be interpreted as transmission of business data between organizations in a computerized format that does not require the re keying of information. Since EDI  is defined as the exchange of electronic documents between organizations, the EDI acronym has also been sometimes interpreted as Electronic Document Interchange.

EDI is a central portion of the overall concept of Electronic Commerce (EC). Electronic Commerce is defined as the paperless exchange of business information. In addition to EDI, electronic commerce uses other electronic means of business communication such as electronic mail (E-mail), computer bulletin boards, FAX systems, and Electronic Funds Transfer (ETF).   

Advantages of EDI :

One of the greatest advantages of EDI is its ability to reduce the cost and time required for reproducing information that the Exporters / Importers used to furnish  on paper. This enables the Customs Department to redirect its resources to more valuable activities, such as examining the consignments for prohibited goods, to ensure accuracy and fairness in procedures, and finding ways to assist industry. Import / Export clearances, which once took days to clear, can now be processed in minutes.

While Customs officers will always need to monitor the process and the physical environment for the subtleties and anomalies a computer can't register, the facility takes care of the mundane and mechanical aspects to allow officers to focus more on areas like  smuggling, illegal Imports / Exports, Evasion of Duty etc. While much progress has been made on this, the potential for further advances is huge. 

                Some of the other advantages of EDI are :

(a)                 Removes processing delays

(b)                 Removes re-keying errors

(c)                 Reduces errors made by human interpretation of data

(d)                 Reduces paper handling, filing, storage and mailing costs

(e)                 Handles message receipt and arrival acknowledgement

(f)                  Strengthens relationship between the various agencies associated

(g)                 Transparency of the movement of the documents. 

Status of EDI in Customs : 

National Informatics Centre (NIC) implements EDI in the Custom Houses through a software package. Indian Customs EDI System (ICES) is designed and developed in consultation with Central Board of Excise & Customs (CBEC). It comprises  two major sub systems namely,

                                ICES / I –  for processing Import Documents.

                                ICES / E – for processing Export Documents 

                Presently in the New Custom House, Mangalore only the ICES /E for processing Export Documents has been introduced. The ICES / I would be introduced shortly. 

                ICES is a software package which accepts the mandatory Customs documents in an electronic format from the Custom House Agents (CHA s), Importers and Exporters for further processing by the Customs Officers. Presently these documents are accepted only through the Service Centre at the Custom House, a facility set up by the Department for initial data entry of the documents submitted by the CHA/Importer/Exporter. Online filing of these documents would start in the near future. Once the Service Centre submits the documents into the system after proper verification by the CHA, the routing of the documents is automatic. This process eliminates all the paper work , thereby eliminating the time lag involved in clearing the Export / Import consignments.  

For any Exporter / Importer or CHA to submit their documents through the ICES , it is mandatory to get themselves registered in the System. 

(a)               Registration forms

(b)               Procedure for Export Under EDI

(c)                Procedure for Import Under EDI ( Yet to be implemented at Mangalore).

Future of EDI in Customs  

Department of Revenue, in keeping pace with the rapid growth taking place in the IT industry, proposes to introduce a high speed network to be called ICENET (Indian Customs & Excise NETwork) through its own gateway to be called ICEGATE (Indian Customs & Excise GATEway). This proposed gateway would link all the Custom Houses to a main server to be put up at the Directorate of Systems, New Delhi. This would enable a single point submission / retrieval of data by various agencies like Exporters, Importers, CHAs, RBI, DGFT, Port Trust, Airlines, Shipping Lines etc. The various Certificates, Licences issued by other agencies would also be available on-line thereby eliminating the process of physical presentation of mandatory documents. The exchange of messages would be on the international standard for EDI i.e. UN/EDIFACT.   

 Traders may file their Export / Import documents only once with any of the agencies and it would be possible for the other agencies to take the same information through standard EDI Message format (UN/EDIFACT) thereby eliminating the process of multiple submission of documents with various agencies. This would also lead to uniformity in assessment procedure throughout the country. Once EFT (Electronic Fund Transfer ) is also accepted and legislated it would also be possible for the Importers / Exporters to deposit  Customs / Excise duty at any bank and receive refunds / drawback directly into their account at any bank of their choice.