‘Too much harassment’: Mohandas Pai slams RBI, CBIC over red tape choking small exporters

Former Infosys CFO Mohandas Pai has sounded the alarm over what he describes as 'harassment' faced by small exporters in India. This comes in line with Union Commerce Minister Piyush Goyal's recent comments about the country's start-up ecosystem, which sparked a massive debate on social media and evoked strong reactions from many entrepreneurs.

Reacting to a Reddit post detailing the bureaucratic maze small businesses must navigate to export goods, Pai criticised the Reserve Bank of India (RBI), the Central Board of Indirect Taxes and Customs (CBIC), and other regulatory bodies for making compliance painful.

Sharing the post on X, Pai wrote: “Minister @PiyushGoyal pl have a look. How can small exporters survive with so much of documentation from @cbic and @RBI This harassment is too much. When will we have EODB? @DPIITGoI @RBI RBI just does not care for citizens. They are a law into themselves with no accountability.”

Minister @PiyushGoyal pl have a look. How can small exporters survive with so much of documentation from @cbic and @RBI This harassment is too much. When will we have EODB? @DPIITGoI @RBI RBI just does not care for citizens.They are a law into themselves with no accountability… https://t.co/tiXiAF9fAQ

— Mohandas Pai (@TVMohandasPai) April 18, 2025

He tagged key institutions and figures — including the Prime Minister’s Office (PMO), Finance Minister Nirmala Sitharaman, and the Ministry of Finance — questioning the effectiveness of India’s “ease of doing business” claims.

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'Ease of doing business is just talk'

Pai's frustration stemmed from a Reddit post titled “Why you should not try exporting from India Vent & Rant” by a user named Limp-Question-4778, who shared his exhausting four-year-long struggle with India's export ecosystem.

“All the talk of ease of doing business is just talk and no walk. You are better off moving to Dubai and exporting from there than from India.”

That’s how the entrepreneur summed up his experience. A small-town businessman who once processed 300-400 domestic orders daily, his problems began in 2022 when he tried to tap into the international market.

What followed was a slew of complex, often redundant steps — acquiring an Importer Exporter Code (IEC), registering on ICEGATE, applying for an Authorised Dealer (AD) code, and using only “licensed” couriers for shipping.

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“Nonsensical for a 30 dollars export,” he wrote, referring to the disproportionate compliance costs.

Things got worse when one of his customers rejected a shipment — and the Indian government charged GST twice: once for the original shipment, and again for the returned one.

“We had to pay GST TWICE on a shipment on which we did not earn a penny,” he said.

By 2024, he ran into deeper trouble due to what he described as the lack of integration between Customs, GST, and RBI platforms. He discovered that shipping documents worth Rs 50 lakh remained “open” in the system. To close each shipping bill, he was asked to pay Rs 400 — totalling Rs 8 lakh, about 16 per cent of his turnover.

His failure to meet the deadline led to his account being marked non-compliant by the RBI, freezing his ability to export.

Despite writing several emails — even attaching diagrams to explain his situation to the Commerce Minister’s office — he claimed there was no response.

Voices of frustration grow louder among netizens 

Pai’s post opened the floodgates for others to share their stories of navigating India’s bureaucracy.

One user commented:“There is no ease of doing business in India ! It’s only a jargon ! All the ease is for the big corporate houses who have big pockets !”

Another wrote: “I have repeatedly saying that BoE and BoL are nightmare to settle, not because of lack of documentation, but incompetent banks and their systems. There should some easy way for small imports like electronic components and small exports,”

Someone else pointed out how costly it is to make even a small transaction: “One of the biggest pain points for small businesses is the lengthy documentation even for small outward remittances. The cost of settling a US$100 invoice can cost upwards of US$200 + multiple CA signed forms and docs before bank can initiate the remittance.”

A fourth user shared a personal experience with corruption in the GST process: “Even for getting a simple GST registration for an individual consultant (supposed to be online clearance), I was asked to pay bribes. As I didn't, it went for 'in-person' visit by babus. When they came, it was a harrowing experience of endless documents. When I agreed to pay, it was cleared with no extra papers!! @TVMohandasPai , my case is not alone. No use complaining to @PiyushGoyal ! He will assure another 'online grievance redressal'! You will have another round of bribes!!”