Clearance system a security risk to defence cargo: AGP
FBR fails to develop in-house software for speedy clearance of goods at terminals.
ISLAMABAD:
A top auditor has found the country’s automotive trade clearance system a security risk and recommended the government purchase proprietary rights and codes from a software vendor in order to avoid information leaks on ‘sensitive defence imports’.
A special study carried out by the office of the Auditor General of Pakistan (AGP) has revealed that the Pakistan Customs Computerised System (PACCS) is a security risk, as the vendor M/s Agility, a Kuwait-based logistics company, has not given the source code to the authorities, posing a security threat to the defence related cargo movement.
The AGP findings endorse the inquiry conducted by the Federal Board of Revenue (FBR) that too labelled the PACCS a security risk. The FBR has declared the system faulty and alleged that the vendor Agility was also involved in fraudulent activities in the US defence supplies.
“The contract with Agility was signed only for the pilot project. All such issues of security code are linked with the issue of intellectual property rights, and until the government resolves this, it will continue facing the problem”, said Abdullah Yousuf, former FBR chairman who launched the pilot project.
The FBR and Agility have been at odds over the extension and expansion of the PACCS pilot project, started in March 2005 but expired in 2008. Since then the pilot project has been surviving on extensions, as the FBR has failed to develop its in-house software for speedy clearance of goods at terminals. On October 1st, Agility gave the fourth extension for another two months.
The auditor general also recommended that the government recover billions of rupees in duties that were evaded on account of 265 missing containers, which the FBR claims were cleared through the PACCS.
However, officials who launched the pilot project strongly refute the allegations and claim that the automotive system is foolproof and no container can get cleared without proper documentation. These officials have been sidelined in the present FBR hierarchy and some of them have been charged with these allegations.
Abdullah Yousuf said that the containers cleared by the automotive security system cannot disappear without the involvement of FBR people. He said a container cleared through PACCS can easily be traced as compared to a container cleared from a manual system.
The audit highlighted that the FBR handed over 20 modules to Agility for running the PACCS. The company first had to develop these modules. However, the study points out that the private company fully developed 9, left incomplete 8 and did not develop 3 modules despite receiving the hefty amount. The audit recommended getting these modules developed from the Agility.
“The deficient development of modules like valuation and adjudication provided opportunities to importers and exporters to evade duties, causing a loss of Rs1.6 billion to the exchequer,” said the office of the AGP.
The AGP also found exceeded cost limits in the pilot project. As against an approved cost of Rs55 million the project was completed at a cost of Rs 116.1 million, exceeding almost by 111 per cent.
Published in The Express Tribune, October 23rd, 2010.
A top auditor has found the country’s automotive trade clearance system a security risk and recommended the government purchase proprietary rights and codes from a software vendor in order to avoid information leaks on ‘sensitive defence imports’.
A special study carried out by the office of the Auditor General of Pakistan (AGP) has revealed that the Pakistan Customs Computerised System (PACCS) is a security risk, as the vendor M/s Agility, a Kuwait-based logistics company, has not given the source code to the authorities, posing a security threat to the defence related cargo movement.
The AGP findings endorse the inquiry conducted by the Federal Board of Revenue (FBR) that too labelled the PACCS a security risk. The FBR has declared the system faulty and alleged that the vendor Agility was also involved in fraudulent activities in the US defence supplies.
“The contract with Agility was signed only for the pilot project. All such issues of security code are linked with the issue of intellectual property rights, and until the government resolves this, it will continue facing the problem”, said Abdullah Yousuf, former FBR chairman who launched the pilot project.
The FBR and Agility have been at odds over the extension and expansion of the PACCS pilot project, started in March 2005 but expired in 2008. Since then the pilot project has been surviving on extensions, as the FBR has failed to develop its in-house software for speedy clearance of goods at terminals. On October 1st, Agility gave the fourth extension for another two months.
The auditor general also recommended that the government recover billions of rupees in duties that were evaded on account of 265 missing containers, which the FBR claims were cleared through the PACCS.
However, officials who launched the pilot project strongly refute the allegations and claim that the automotive system is foolproof and no container can get cleared without proper documentation. These officials have been sidelined in the present FBR hierarchy and some of them have been charged with these allegations.
Abdullah Yousuf said that the containers cleared by the automotive security system cannot disappear without the involvement of FBR people. He said a container cleared through PACCS can easily be traced as compared to a container cleared from a manual system.
The audit highlighted that the FBR handed over 20 modules to Agility for running the PACCS. The company first had to develop these modules. However, the study points out that the private company fully developed 9, left incomplete 8 and did not develop 3 modules despite receiving the hefty amount. The audit recommended getting these modules developed from the Agility.
“The deficient development of modules like valuation and adjudication provided opportunities to importers and exporters to evade duties, causing a loss of Rs1.6 billion to the exchequer,” said the office of the AGP.
The AGP also found exceeded cost limits in the pilot project. As against an approved cost of Rs55 million the project was completed at a cost of Rs 116.1 million, exceeding almost by 111 per cent.
Published in The Express Tribune, October 23rd, 2010.