Catching on the catch-all

On ‘Catch-all’ controls in export of dual-use goods and services
The Foreign Trade (Development & Regulation) Act , administered by the Department of Commerce, is the law that allows government to regulate export and imports from India. Commerce Minister , Shri Anand Sharma, has in November 2009 introduced Foreign Trade ( Development & Regulation ) Bill 2009 in Parliament to amend the Foreign Trade Act. The bill is currently under discussion before the Standing Committee on Commerce. As part of legislative process to benefit from widest section of public opinion and stake holders, committee has invited memorandum from public on the proposed amendments in the Bill.
The bill proposes to change several things. One being power to ban imports in case of surge in cheap imports that threaten nascent domestic industries .This is sought to be attained by including GATT(General Agreement on Trade and Tarrifs) compliant safeguard measures in the Act. Government also wants to bring services and technology businesses in the ambit of the Act. Though much of boom in services and technology sector over last two decades is undoubtedly attributed to government not being there. The ostensible reason given is to support these sun-rise industries through subsidies and grants. Imagine TCS and Infosys lining up for government bailout in some future scenario. Perhaps commerce minister is articulating a vision about which no reason and rationale exists today.
The most controversial change, however, seems to be introduction of ‘Catch-all controls’ in export of dual-use goods and technologies. Dual-use technologies and materials , by definition, are those goods and services that have widespread commercial use but are also needed for military applications. The definition is rather perfunctory as nearly everything that we use today can be used to build weapons and war materials. Rapid growth of strategic commerce, the most regulated business in the world, is due to the growing realization that increasing trade and widespread diffusion of technologies also undermines security. India, through its Foreign Trade Policy, maintains a list of controlled goods that require an export license for overseas sales. Yet in the era of WMD threat, these steps are not thought to be enough to meet challenges posed by proliferation which is believed to be rampant and growing. Security issues today are creeping into the heart of global trade agenda with ever increasing rapidity. Therefore some bit of history will serve us well here.
Though United States throughout its history has been the staunchest supporter of free trade, that policy since its ascent to world leadership post second world-war has been greatly compromised. It has become difficult for US to separate economics from politics. The roots of strategic trade control lay here. The professed goal of US export policy is to ensure national security by maintaining its economic and military power through tight control on flow of modern technologies flowing from America’s research labs while simultaneously ensuring that US corporations maintain their competitive edge in global market by using those innovations from America’s mostly tax-payer funded labs.
Various global technology control regimes have been in existence since second world war II. Almost all were initiated and led by the US with help of other developed nations, most notably those from Europe. India has always been at their receiving end as some like Nuclear Supplier Group were created specifically to punish it for its ‘peaceful nuclear explosion’ in 1974. But the real ballast to global export controls was provided by the US after collapse of Soviet communism in 1990.
Apart from strengthening existing multilateral export control arrangements i.e Nuclear Suppliers Group, Wassenaar Arrangement on dual-use goods, Australia Group on chemical weapons and Missile Technology control regime(MTCR), United States unilaterally came up with a policy instrument of Enhanced Proliferation Control Initiative(EPCI) in 1993 which extended hitherto list based controls to end-user and end-use verifications also. The broad principle enunciated for enforcement of EPCI meant that if any US entity or citizen knew or had reason to believe that his business partners overseas were involved in proliferation related proscribed activities , he was to treat any saleable goods and service to such partner as one requiring an export license. This policy came to be known as ‘Catch-all controls’.
These ‘Catch-all controls’ are enforced by the US President under International Economic Emergency Powers Act( IEEP). US Congress and President have not been able to build consensus around having an Export Control Act precisely for fear of crippling US corporations overseas through such stringent controls. This puts the United States in the embarrassing position of encouraging other governments to adopt export control laws without itself having one.
India’s evolving export controls are primarily an outcome of its intense bilateral engagement with the US post Pokhran II in 1998. One outcome of that process has been the Weapons of Mass Destruction Act passed in 2005 by Indian parliament which proscribes all unauthorized activity related to nuclear, biological and chemical weapons by all state and non-state actors. The present bill also proposes to enable WMD Act with Foreign Trade Act. Though WMD Act adopts ‘catch-all’ controls’ , it is now also explicitly sought to be brought in Foreign Trade Act .
But implications of this move have hardly been debated and discussed in public. Even though India has pursued an export centric approach to modernize its economy, it has little experience in managing strategic trade policy. Growth of high-technology industry is predominantly a post economic liberalization phenomenon beginning in the 1990s. Trade and industry too have limited experience in grasping the nuances of proliferation concerns arising in a rapidly globalizing world. On the other hand there seems to be policy consensus that expanding commerce has also endangered global communities sense of security.
It is a reasonable approach that India should regard “catch all” as an attempts to deny the inevitability of slow technology-diffusion, via excessive information gathering. So long as it remains a net importer of high-technology , this approach seems eminently in national interest. Besides shackling Indian companies for security concerns will prove controversial and unpopular among businesses once the law takes it life and begins to regulate business activities of Indian companies in future. By shifting burden of enforcement on industry, ‘catch-all’ controls will permanently stifle the growth of high-tech industries in India. Imagine TCS or Infosys someday being asked to account for their non-proliferation role for having written a software code embedded in a chip made by a Korean company and used in a missile fired by Iran across Persian Gulf? Such is the frightening sweep of ‘catch-all’ export controls being pushed into the Foreign Trade Act through the amendment bill by the government. Could India care more for it’s technology-driven future?

Amendment bill to FT(D&R) Act 1992 before the Parliament of India

Following is the text of the Memorandum on Foreign Trade (Development &Regulation ) Amendment Bill 2009 submitted by the Institute of International Trade & Security
Before The Standing Committee on Commerce in Parliament of India.
In the statement of objects and reasons, the Commerce Minister has stated the following:
The Foreign Trade ( Development & Regulation) Amendment Bill 2009 (henceforth to be referred as the ‘bill’) amending Foreign Trade(Development & Regulation ) Act 1992 ( henceforth referred as ‘Act’) intends to provide for,
1. Imposing quantitative restrictions to safeguard interests of domestic industries against injury caused by import surge.
2. Dispensing with requirement for license or permit to import and export except as provided by the Act.
3. Enabling swift and exemplary action in trade dispute matters.
4. Rationalizing and improving system of levying and realizing fiscal penalties.
5. Providing provision for review of all decisions of sub-ordinate officers by the Director General of Foreign Trade.
6. Authorizing Settlement Commission under the Customs Act 1962 to settle interest dues under the Act
7. Bringing ‘Technology’ and ‘Services’ in the ambit of Act.
8. Establishing tighter export controls by enabling WMD Act 2005.

Each of the above proposals need to be examined from perspective of policy goals intended to be achieved, legislative redundancy, executive experience of efficacy of the Act since enactment nearly two decades ago and also to clearly comprehend the implications for fast modernizing Indian economy arising from export controls on dual-use goods including the most sensitive clause on ‘catch all controls’ proposed under section 14C of the bill.

1. Quantitative restrictions for purpose of safeguards action.
The GATT rules under the WTO permit developing countries to assist their new and infant industries. This assistance may often take the form of safeguards action restricting imports for temporary period. Since such support can adversely affect the interests of exporting countries, GATT rules lay down stringent conditions for their adoption. The preferred method to restrict imports is through raising tariffs by increasing bound rates. Yet if industrial injury fails to be mitigated by raising tariffs, quantitative restrictions can be imposed. In India, Director General Safeguards under the Deptt of Revenue enforces safeguard action under section 8B and 8C of the Customs Act 1962 through GATT compliant procedure laid down under the rules made therein. But it can only invoke safeguards action limited to tariff controls. Quantitative restrictions(QRs) on imports and exports in India are regulated through Act under amendment through instant bill.
Section 3 of the Act grants central government a carte-blanche to regulate, prohibit or restrict imports into and exports from India. Section 5 further authorizes the central government to formulate and announce and amend the export import policy. These two provisions of the statute have been used by the government to impose QRs by prohibiting or restricting all imports and exports till date. Item wise list of policy on exports and imports is published by the government as ITC(HS) Export Import policy. Its clear that there is no further need for statutory approval from parliament for imposing QRs. They can be imposed like any other QRs government imposes from time to time. Except.
Except the fact that QRs under safeguard rule of WTO need to be imposed in a manner laid under the GATT rules. The Act lays down no procedure but leaves it free to the executive to formulate any procedure through rules, policy etc. The procedure prescribed for QRs for safeguards can be formulated as a sub-ordinate legislation under Section 19 of the Act by the central government or under section 5 through export import policy and procedures as is the prevailing practice in the Directorate General of Foreign Trade( DGFT) who administers the instant Act. Alternatively the safeguards rules made under the Customs Act 1962 could be directly enabled through amendment to Foreign Trade (Regulation) Rules 1993. This would additionally ensure uniformity of procedure in India while invoking full sweep of safeguards provisions enhancing the confidence of international trading community in our trade and tariff rules.
Thus a case is made that the proposal adds to legislative redundancy hence needs to be ignored with due advice to the executive.

2. Dispensing with requirement for license or permit to import and export except as provided by the Act.
This curiously worded intent doesn’t translate into a cogent proposal anywhere in the bill. The Act under section 3 itself empowers the central government to dispense with requirement of permit or license except as provided by the law. Even in operation today, nearly all imports and exports except a small specified list of goods are allowed without a permit or license. A question would arise then: If no legislative mandate was available till date, how do the exporters and importers today do business without a license or a permit( except an Import-Export code number) from the government? Nor is there any proposal made to give affect to above intent.

3. Enabling swift and exemplary action in trade dispute matters.
This noble intention , sadly again, finds no articulation in the form of a proposal in the bill. Rising trade disputes in international trade has been an area long deserving attention of the government. For exporters and importers, there is no forum except arbitration and conciliation through contractual litigation. Cost of litigating overseas is beyond even medium sized businesses. Existing trade dispute procedures under export import policy are ineffectual for reasons that could had been the motive to express this intent. The government certainly needs to express its thinking on the matter through consultation with all stake holders.

4. Rationalizing and improving system of levying and realizing fiscal penalties.

The bill proposes amendment to sub-section 11(2) of the Act with regard to levy of fiscal penalty if provisions of Act are contravened. It proposes a minimum penalty of Rs ten thousands that may go upto five times the value of goods and services involved in violation. There is no change from the existing penal provisions except the lower limit stands raised to rupees ten thousands from rupees one thousands. Unarguably it grants vast discretion to the officials in matter of determining fiscal penalty as average consignment values involved in international trade are today more than Rs. one million. This discretion is prone to be abused by the officials and can be crippling to businesses that find themselves at the mercy of an abusive enforcement machinery. The fiscal penalty ought to have a deterrent value that improves compliance not financially cripple a business. An exporter or importer of free goods is never free from duty related fiscal liabilities under Customs and Excise Acts. As regards sensitive goods, stringent provisions in conformity with WMD Act have been proposed which includes imprisonment .A penalty ranging from Rs.Ten thousands to one lakh should be seen as an improvement and rationalization in the Act.
Besides , the government proposes to divide the work of collecting penalties levied with help of two departments of central government and also through machinery of state governments.. Though the penalties will be levied by the DGFT, it can be collected by Customs authorities also. And finally to district collector through arrears of land revenue if both DGFT and Customs fail to do so. This proposal for convenient division of work will lead to nothing but buck-passing in the event of revenue loss and the ultimate looser will be the tax-payer. Accountability , given the incessant turf war between government departments, will be the major causality. If a far specialized and better endowed enforcement machinery with the central government fails to recover its dues from erring exporters, how can a state government be expected to do so. It’s appears to be the most cleverly conceived bottomless pit to siphon out public money. Committee must ask the DGFT to enlighten it on its enforcement record of past two decades in administering this Act. A detailed analysis of penalties imposed, recoveries made will help the committee examine the efficacy of the proposal. Or is it a tacit admission by the commerce minister that provisions of the proposed bill have financial implications? Else why not administer the law in all aspects, from imposing fines to recovering them for the tax-payers? If it is admission of the abject failure of government in administering penal provisions of the Act, then why not accept it and honestly examines the reasons before proposing remedies?

5.Providing provision for review of all decisions of sub-ordinate officers by the Director General of Foreign Trade.

The objective expressed clearly states that DGFT doesn’t have the power to review the decisions of his sub-ordinate officers. It can at best be termed as shocking ignorance of statutory provisions of the Act in the government. In fact, section 16 of the Act deals with power of ‘revision’ vested in the DGFT. This section allows DGFT to review all the decisions made by his sub-ordinate officers. Surprisingly, the only amendment proposed in the bill to section 16 is changing its the name from ‘revision’ to ‘review’ and deleting the provision related of review of appeals made under section 15 . All other provisions of the section 16 remain completely unaltered. It seems government intends to empower DGFT to be able to review order-in-appeals also which hitherto could be reviewd by high courts having writ jurisdiction . Words ‘revision’ and ‘review’ are synonymous. Proposed change in section 16 can be effective only by deleting sub-section 15(3) also as it states that' ..order-in-appeal made under section 15 shall be final'. The only amendment to section 15 that has been proposed is changing the title of Chapter V of the Act from ‘Appeal and Revision’ to ‘Appeal and Review’! How can sub-section 15(3) co-exist with amended section 16? Looks like law-draftsman's blunder!

6.Authorizing Settlement Commission under the Customs Act 1962 to settle interest dues under the Act

Its not clear as to what are the detailed reasons behind this proposal. DGFT administers a number of export promotion schemes i.e duty free imports of raw materials and capital goods for export production. Exporters while obtaining these authorizations, commit to make exports and failing so return the custom duties with interest to the DGFT as per procedure prescribed under the Foreign Trade Policy and Procedures. This has been the broad and stable principal of government’s export promotion schemes over more than last two decades. In case the exporter fails to pay back the custom duty and interests due post- default, he is treated to be in violation of the Act. For which he attracts penal provisions leading to fiscal penalties upto five times the value of the goods he imported on duty free basis. This is apart from the fact that he may also simultaneously be, after a default in meeting export obligation, in violation of Customs Act . He may make a settlement as per the Customs law but that doesn’t rescue him from adjudication proceedings under section 13 of the Act leading to imposition of fiscal penalty. That clearly traps him into the enforcement machinery of two agencies of government working independently in their sovereign domains. The net result is each undermines the others actions at the cost of public interest. Bill proposes amendment to section 11 empowering Settlement Commission at Customs to settle the cases of export obligation default for the benefit of DGFT also.
Clearly in case of default in DGFT, an exporter would first like to settle the case before the Customs with regard to all custom duty and interest related liabilities. It would mean DGFT suspends any penal proceedings under section 13 read with section 11 pending the outcome of settlement proceedings in Customs. If that is the case , an amendment to ensure that adjudication under the Act remains suspended pending outcome of the settlement is also needed in the Act. However ,this hasn’t been proposed anywhere. It would effectively reduce DGFTs workload and available surplus could be deployed in new areas.
Its also not clear why DGFT doesn’t utilize the facility of ‘settlement’ provided under rule 16 of the Foreign Trade (Regulation) Rules, 1993 for the benefit of exporters so that it makes best of its mandate to serve the exporting community.
Thus, the proposal to delegate responsibility to another authority appears merely to a clumsy attempt at appropriating powers but obviating burden of responsibility by a government department. It must be rejected without further consideration.

7. Bringing ‘Technology’ and ‘Services’ in the ambit of Act.
Habits die hard, as they said. Government’s desire to expand and peoples resolve to shrink it will always be a defining feature of every legislative politics. Why do we think that future can also be legislated and thus regulated? Technology and services are the industries of tomorrow. India’s manufacturing potential was realized when it broke away from ‘license-quota-permit’ culture ,in no less measure sustained by the predecessor to this Act. If carpentry, tailoring, weaving is better done without an inspector breathing down their neck, why not the children of carpenters, weavers, masons and tailors engaged in building a new economy of software, services, finances ? The idea of regulating services and technologies is inherently unsound and anti-people. It ignores the potential of people and undermines their determination to build a life that their forefathers dreamt. Yet government has been regulating it without a mandate from the parliament.
How? The proposal states that government intends to regulate ‘technology, services, including financial services’ within the ambit of the Act for purpose of incentives and other provisions of Foreign Trade Policy. This is to be achieved by broadening the definition of exports and imports. In fact , the Foreign Trade Policy announced by the government has a full chapter on services exports and it has been disbursing incentives, subsidies to services exporters i.e hotels, tourist resorts, airlines for many years since now. How did it do so when it wasn’t sanctioned by the statute? Or is it now a plane case of executive seeking ex-post facto approval from parliament for having used the powers it never had? If only someone would see the irony in calling Export Import Policy under section 5 of the Act as Foreign Trade Policy without statutory authorization . One could after all ignore this saying there isn’t much in a name yet the gulf between legislative mandate and executive indifference is starkly visible.

8.Establishing stronger export controls by enabling WMD Act 2005.
The Weapons of Mass Destruction and their Delivery Systems (Prohibition of Unlawful Activities) Act 2005 is a comprehensive piece of legislation to regulate all activities related to nuclear, biological , chemical weapons and also dual-use goods and technologies. Dual-use goods and technologies , by definition, are those materials and know-how that have both commercial and military applications. The Act presently regulates dual-use goods in the form of a list of specified materials published under the FTP. Strategic commerce today, is most regulated business in the world. Developed countries led by the United States of America(US) tightly guard the flow of cutting-edge goods and technologies as a part of their policy goal to maintain their economic and military strength.

Though United States throughout its history has been the staunchest supporter of the principle of free trade but a series of dramatic changes since the world war II has compromised that policy to a large extent. With its ascent to the world leadership after second world war it could no longer afford to avoid entanglement in political struggle and conflicts around the world. It thus became impossible for the US to separate economic relationship from political relationship. Further the advent of nuclear weapons in second world war made the idea of war to achieve political goals largely impractical. Hence US evolved a trade control system based largely on the use of export controls an effective alternative weapon to direct military conflict to achieve its political objectives.
India’s evolving export control system is a direct consequence of engagement with the world community, US in particular, to meet common challenges posed by proliferation of technologies and materials that go into making weapons of mass destruction. Even though India has pursued export centric approach to modernize its economy, it has little experience in managing strategic trade policy. Growth of high-technology industry is predominantly a post economic liberalization phenomenon. Trade and industry too have limited experience in grasping the nuances of proliferation concerns arising in a rapidly globalizing world. On the other hand expanding commerce has also endangered global communities sense of security.
In attempting to set forth the inter-weaving agenda of trade and security in recent historical context , two dates stand out. The first being 1st January 1995 when the World Trade Organization(WTO) came into existence. The birth of WTO at the culmination of the Urguay round of trade negotiations indicated an unprecedented global consensus in favor of free trade and thus signified the triumph of free market principles. However free market did not ,and rightly so , imply unfettered markets. Members of the WTO club, in exception to the Most favored Nation (MFN) treatment, continue to maintain some permissible restrictions on trade for reasons of national security, to protect environment and culture, in pursuance of compliance of international treaties and obligation and sometimes for political reasons. Albeit these trade restrictions are now required to be applied with greater transparency.
The second important date on timeline is 11 September 2001 which brought terrorists attack on the United States and triggered the ongoing global war against terror. As a multifaceted response to the war on terror , United states has brought the security at the heart of international co-operation agenda. This has manifested in increased impetus to the nonproliferation efforts to control the spread of the weapons of mass destructions(WMDs) to avert future terror assaults. Export controls form one important component of that anti-proliferation approach. Trade in strategic goods ,therefore, requires a special treatment with emphasis on security rather than commerce.
In the Indian context, two developments require special mention. The first is the globally recognized success of India’s information technology(IT) sector and its competitiveness in the world market. In many ways the IT sector of India is the byproduct of process of economic liberalization that began in the 90s. It is also the first high-tech industry of India to venture into the global arena. The fact that it grew as and is still largely export oriented points to the role of global market access in sustaining that growth. IT industry, truly, is the ringleader of Indian industries high-tech march. The growth of telecommunication sector, bio-technology and pharmaceutical industries in last decade is a pointer to the changing complexion of Indian industries’ technological sophistication.
The other important event to be recalled is Pokhran II, when in May 1998 India stunned the world by conducting underground nuclear tests dealing a severe blow to the discriminatory international non-proliferation order. This achievement of India’s scientific community in the face of determined global technology denial regimes proved the success of it’s indigenous efforts and its determination to overcome all odds to protect its national security.
But this rising profile on both fronts had consequences. While one accelerated the march of Indian companies to all corners of the world, the other brought the government under increased scrutiny of international anti-proliferation lobbies, particularly the United States(US). Hence a bilateral engagement that began with the US post Pokhran II on proliferation and security issues has brought export controls as one important issue on the front desk of policy makers. Indo-US nuclear deal is the most recent consequence of that engagement.
The proposed amendment in the bill ought to be seen in the light of aforementioned facts. Though the basic legislative framework has already been provided to meet India’s commitments to global non-proliferation order under the WMD Act 2005, it would be mis-leading to construe that the proposed amendment merely enables the legislation to the Act under amendment. In fact it intends to introduce extremely sensitive and wholly undesirable provision in the form of sub-section 14C on catch-all controls. Equally undesirable is sub-section 14D which suspends the principal of natural justice in enforcement proceedings against companies and persons if they are suspected of unlawfully exporting specified materials and technologies. Catch-all controls proposed here have been borrowed from US export control system.
The US export controls system has roots that reach at least as far back as the First World War, when the United States cooperated with Great Britain to institute a “navicert” (i.e., naval certification) system for exports and passed the Trading with the Enemy Act (TWEA). The Cold War system of national and multilateral export controls developed nearly two decades later eventually spawned a fledgling system of export controls in the 1970s on nuclear items and in the 1980s on chemical and missile items. Nonproliferation export controls, however, really took shape in the aftermath of the Gulf War and the collapse of Soviet communism nearly two decades ago.
Control over the export of military and dual-use (i.e., goods, services, and technology with mainly commercial but also defense applications) by the United States, always complex, has become even more complicated in recent years. Adapting the policies of the Cold War to discourage the spread of weapons of mass destruction (WMD), advanced conventional weapons, and missiles to deliver the weapons has proven arduous and contentious. To maintain restrictions on most dual-use items, for example, the United States government relies on the International Economic Emergency Powers Act (IEEPA) as Congress and the Executive have not built sufficient common ground to create a new law on export controls. The controversy in the US over controls on encryption products and satellite exports in 2001 only followed a long line of problems, from the role of the Defense Department in the license review process to the imposition of mandatory, often unilateral, controls for reasons of foreign policy, that have plagued efforts to develop a new legal basis for US export control policy. This puts the United States in the embarrassing position of encouraging other governments to adopt export control laws without itself having one.
The United States, as the leading advocate of nonproliferation export controls, most often devises initiatives that set the international standards for export controls. Multilateral standards emanate through the consensual efforts of many nations, however, and the United States finds itself at odds with those standards from time to time.

Catch-all controls :
“Catch-all” owes its existence to United State lead Enhanced Proliferation Control Initiative(EPCI) in early 1993. This policy seeks to deny export license for any product irrespective of its controlled status under the US export control laws to any destination, end-use or end-user of proliferation concern. It transfers, to a large extent, the burden of enforcing export control policies to the industry itself eliciting their voluntary cooperation in enforcing export controls. “Catch all” derives legal force from the US constitution which makes trading a privilege rather than a right in the United States.
There can not be any prospects for adoption of “catch all” in India as Indian constitution allows trading as a right of individuals while reserving states right to regulate it in a manner it deems fit. By no means it’s a privilege that state can withdraw at will. India must regard “catch all” as an attempts to deny the inevitability of slow technology-diffusion, via excessive information gathering. Besides shackling Indian companies for security concerns will prove controversial and unpopular among businesses. By shifting burden of enforcement on industry, catch-all controls will permanently stifle the growth of high-tech industries in India. Even US congress has not enacted an export control law with catch-all controls precisely with due to opposition from US corporations. By enacting those provisions in our export control statute, can we afford to be seen as more Americans than Americans themselves? Even for limited export control enforcement US relies on vast global network of its intelligence and military power. I have grave doubts if the government has seriously pondered over the implication of this proposal for Indian companies and whether trade bodies have been taken into confidence about this proposal. Even the sheer scale and size of enforcement machinery to enforce this provision would require astounding resources. Security will completely trump commerce leaving neither in the end.
It is worth recalling here that the policy stance taken by the US government on catch-all controls was instrumental in ill-fated invasion of Iraq in 2003. An Indian company NEC Engineers in 2002 was accused by the US government of supporting Iraq’s WMD program prior to orchestrating invasion of Iraq on basis of fabricated evidence. Indian government agencies ,invoking all unconnected draconian laws arrested and jailed the senior officer of the company merely on the basis of information supplied by US officials. The government should come out with facts in public interest regarding the case of NEC Engineers and let the parliament see how catch-all controls destroyed a thriving Indian company. It must not be allowed to hide behind the veil of judicial proceedings in larger public interest.
Above testimony therefore makes a strong case to abandon these ill-conceived and unconstitutional amendment to the Act by inserting section 14C and 14D through the bill. The attempt must be jettisoned forthwith.

Conclusions:
The proposals in the amendment bill are either redundant or lacking in any clear policy focus and rationale. Not enough home work has been done before proposing the amendment bill. So much that the very nature of proposals betrays a shocking sense of ignorance in government about the existing statutory provisions on objectives desired to be attained. Most of the provisions i.e safeguards related, review power of DGFT, provision for settlement of dues are already existing in the Act and Rules.
The most sensitive and wholly undesirable idea of introducing ‘catch-all controls’ in export of dual-use goods and also of enforcing the provisions of the rules related to dual-use technologies and goods without adhering to principal of natural justice should be rejected by the parliament of India in the interest of its people.