FOREIGN TRADE POLICY
[1st April, 2015 – 31st March, 2020]
Government of India
Ministry of Commerce and Industry
Department of Commerce
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Table of Contents
CHAPTER 1 ………………………………………………………………………………….. 13
LEGAL FRAMEWORK AND TRADE FACILITATION ……… 13
A. LEGAL FRAMEWORK ……………………………………………………… 13
1.00 Legal Basis of Foreign Trade Policy (FTP) ………….. 13
1.01 Duration of FTP …………………………………………………………. 13
1.02 Amendment to FTP …………………………………………………… 13
1.03 Hand Book of Procedures (HBP) and
Appendices & Aayat Niryat Forms (AANF): ……….. 13
1.04 Specific provision to prevail over the general ……. 14
1.05 Transitional Arrangements ……………………………………… 14
B. TRADE FACILITATION &
EASE OF DOING BUSINESS …………………………………………….. 15
1.06 Objective ……………………………………………………………………… 15
1.07 DGFT as a facilitator of exports/imports …………….. 15
1.08 Niryat Bandhu – Hand Holding Scheme
for new export / import entrepreneurs …………….. 15
1.09 Citizen’s Charter ………………………………………………………… 16
1.10 Online Complaint Registration and
Monitoring System ……………………………………………………. 16
1.11 Issue of e-IEC
(Electronic-Importer Exporter Code) ………………….. 16
1.12 e-BRC ……………………………………………………………………………. 17
1.13 MoU with State Governments for sharing of
e-BRC data …………………………………………………………………… 17
1.14 Exporter Importer Profile ……………………………………….. 18
1.15 Reduction in mandatory documents
required for Export and Import …………………………….. 18
1.16 Facility of online filing of applications …………………. 18
1.17 Online Inter-ministerial consultation ………………….. 19
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1.18 Facility to upload documents by
Chartered Accountant / Company Secretary /
Cost Accountant ………………………………………………………... 19
1.19 Electronic Data Interchange (EDI) ………………………. 20
1.20 Message Exchange with Community partners …… 20
(a) Message Exchange with Customs ………………………….. 20
(b) Message Exchange with
eBiz (https://www.ebiz.gov.in) …………………………….. 20
(c) Message Exchange with Banks ………………………………. 21
(d) Message Exchange with EPCs ………………………………… 21
1.21 Encouraging development of Third Party API …… 21
1.22 Forthcoming e-Governance Initiatives ………………… 21
1.23 Free passage of Export consignment …………………… 22
1.24 No seizure of export related Stock ………………………. 22
1.25 24 X 7 Customs clearance …………………………..…………… 22
1.26 Single Window in Customs ……………………………………… 23
1.27 Self-Assessment of Customs Duty …………………………. 23
1.28 Authorised Economic Operator (AEO)
Programme …………………………………………………………………. 23
1.29 Prior filing facility for Shipping Bills …………………… 24
1.30 Cutting down delay in filing of
Export General Manifest (EGM) for
duty drawback ……………………………………………………….….. 25
1.31 Facility of Common Bond /
LUT against authorizations issued under
different EP Schemes ……………………………………………….. 25
1.32 Exemption from Service Tax on Services
received abroad …………………………………………………………. 25
1.33 Export of perishable agricultural Products ………… 25
1.34 Time Release Study (TRS) ………………………………………. 26
1.35 Towns of Export Excellence (TEE) ……………………….. 26
1.36 Director General of Commercial Intelligence
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and Statistics (DGCI&S), Kolkata as the
provider of trade data …………………………………………………. 27
CHAPTER 2 ………………………………………………………………………………….. 28
GENERAL PROVISIONS REGARDING IMPORTS AND
EXPORTS …………………………………………………………………………………… 28
2.00 Objective ……………………………………………………………………… 28
2.01 Exports and Imports – ‘Free’, unless regulated 28
2.02 Indian Trade Classification
(Harmonised System) [ITC (HS)] of
Exports and Imports ………………………………………………… 28
2.03 Compliance of Imports with Domestic Laws …….. 29
2.04 Authority to specify Procedures ……………………………. 29
Importer-Exporter Code / e-IEC ………………………………………. 30
2.05 Importer-Exporter Code (IEC) ………………………………. 30
2.06 Mandatory documents for export/
import of goods from/into India …………………………... 32
2.07 Principles of Restrictions ………………………………………… 33
2.08 Export/Import of Restricted goods/Services ……. 34
2.09 Export of SCOMET Items …………………………………………. 34
2.10 Actual User Condition …………………………………………….. 34
2.11 Terms and Conditions of an Authorisation ……… 35
2.12 Application Fee ………………………………………………………….. 35
2.13 Clearance of Goods from Customs
against Authorization ………………………………………………. 35
2.14 Authorisation – not a Right…………………………………….. 35
2.15 Penal action and placing of an entity in
Denied Entity List (DEL) ………………………………………… 36
Prohibitions (Country and Product Specific): …………….. 37
2.16 Prohibition on Import and Export of
‘Arms and related material’ from / to Iraq ………. 37
2.17 Prohibition on Direct or Indirect Import
and Export from / to Democratic People’s
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Republic of Korea …………………………..…………………………. 37
2.18 Prohibition on Direct or Indirect Import
and Export from/ to Iran …………………………..……………. 38
2.19 Prohibition on Import of Charcoal from Somalia 38
Import / Export Through State Trading Enterprises: 39
2.20 State Trading Enterprises (STEs) …………………………. 39
Trade with Specific Countries: ………………………………………….. 39
2.21 Trade with neighbouring Countries …………………… 39
2.22 Transit Facility …………………………………………………………… 40
2.23 Trade with Russia under
Debt-Repayment Agreement ………………………………… 40
Import of Specific Categories of Goods: …………………………. 40
2.24 Import of Samples …………………………………………………….. 40
2.25 Import of Gifts ……………………………………………………………. 40
2.26 Passenger Baggage ……………………………………………………. 40
2.27 Re – import of goods repaired abroad …………………. 41
2.28 Import of goods used in projects abroad ……………. 41
2.29 Import of Prototypes ………………………………………………… 41
2.30 Import through courier service …………………………….. 42
Import Policy for Second Hand Goods : …………………………. 42
2.31 Second Hand Goods …………………………………………………. 42
Import Policy for Metallic Waste and Scraps : ……………. 43
2. 32 Import of Metallic waste and Scrap …………………….. 43
2.33 Removal of Scrap/waste from SEZ ……………………….. 44
Other Provisions Related to Imports:…………………………….. 44
2.34 Import under Lease Financing …………………………….. 44
2.35 Execution of Legal Undertaking (LUT) /
Bank Guarantee (BG) ……………………………………………….. 44
2.36 Private/Public Bonded Warehouses for
Imports ……………………………………………………………………….. 44
2.37 Special provision for Hides Skins and
semi-finished goods ………………………………………………….. 45
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2.38 Sale on High Seas ………………………………………………………. 45
Exports: ……………………………………………………………………………………… 45
2.39 Free Exports ……………………………………………………………….. 45
2.40 Exemption / Remission of Service Tax
in DTA on goods & services exported ………………….. 46
2.41 Benefits for Supporting Manufacturers……………….. 46
2.42 Third Party Exports …………………………………………………. 46
Exports of Specific Categories …………………………………………… 46
2.43 Export of Samples …………………………………………………….. 46
2.44 Export of Gifts …………………………………………………………….. 47
2.45 Export of Passenger Baggage ……………………………….. 47
2.46 Import for export …………………………..………………………….. 47
2.47 Export through Courier Service …………………………….. 49
2.48 Export of Replacement Goods ……………………………… 49
2.49 Export of Repaired Goods ……………………………………….. 49
2.50 Export of Spares ……………………………………………………….. 49
2.51 Private Bonded Warehouses for Exports ………….. 50
Payments and Receipts on Imports / Exports …………….. 50
2.52 Denomination of Export Contracts ……………………….. 50
2.53 Export to Iran – Realisations in
Indian Rupees to be eligible for FTP
benefits / incentives …………………………………………………. 51
2.54 Non-Realisation of Export Proceeds ……………………. 51
Export Promotion Councils ………………………………………………… 52
2.55 Recognition of Export Promotion Councils
(EPCs) to function as Registering Authority
for issue of RCMC. …………………………..…………………………. 52
2.56 Registration-cum–Membership Certificate
(RCMC) ………………………………………………………………………… 52
Policy Interpretation and Relaxations: …………………………. 53
2.57 Interpretation of Policy …………………………………………… 53
2.58 Exemption from Policy/ Procedures ………………….. 53
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2.59 Personal Hearing by DGFT for
Grievance Redressal …………………………………………………. 54
2.60 Regularization of EO default and
settlement of Customs duty and interest
through Settlement Commission ……………………….. 55
Self Certification of Originating Goods ………………………….. 55
2.61 Approved Exporter Scheme for
Self Certification of Certificate of Origin. ……………. 55
CHAPTER 3 ………………………………………………………………………………….. 57
EXPORTS FROM INDIA SCHEMES …………………………..…………. 57
3.00 Objective ……………………………………………………………………… 57
3.01 Exports from India Schemes …………………………………… 57
3.02 Nature of Rewards ……………………………………………………. 57
Merchandise Exports from India Scheme (MEIS) ………. 58
3.03 Objective ……………………………………………………………………… 58
3.04 Entitlement under MEIS ………………………………………….. 58
3.05 Export of goods through courier or
foreign post offices using e-Commerce ……………….. 58
3.06 Ineligible categories under MEIS ………………………… 59
Service Exports from India Scheme (SEIS) …………………… 60
3.07 Objective ……………………………………………………………………… 60
3.08 Eligibility……………………………………………………………………… 60
3.09 Ineligible categories under SEIS ……………………………. 61
3.10 Entitlement under SEIS ……………………………………………. 63
3.11 Remittances through Credit Card and
other instruments for MEIS and SEIS …………………… 63
3.12 Effective date of schemes (MEIS and SEIS) …………. 63
3.13 Special Provisions……………………………………………………… 63
Common Provisions for Exports from India Schemes
(MEIS and SEIS) ………………………………………………………………………. 64
3.14 Transitional Arrangement ………………………………………. 64
3.15 CENVAT/ Drawback …………………………………………………. 64
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3.16 Import under lease financing …………………………………. 64
3.17 Transfer of export performance ………………………….... 65
3.18 Facility of payment of custom duties
in case of E.O. defaults and fee through
duty credit scrips ………………………………………………………. 65
3.19 Risk Management System ……………………………………….. 65
3.20 Status Holder ……………………………………………………………… 66
3.21 Status Category ……………………………………………………….…. 67
3.22 Grant of double weightage ……………………………………… 67
3.23 Other conditions for grant of status ……………………… 68
3.24 Privileges of Status Holders ………………………………….. 68
CHAPTER 4 ………………………………………………………………………………….. 71
DUTY EXEMPTION / REMISSION SCHEMES ………………….. 71
4.00 Objective ……………………………………………………………………… 71
4.01 Schemes ………………………………………………………………………. 71
4.02 Applicability of Policy & Procedures ……………………. 71
4.03 Advance Authorisation …………………………………………….. 72
4.04 Advance Authorisation for Spices …………………………. 72
4.05 Eligible Applicant / Export / Supply …………………….. 72
4.06 Advance Authorisation for
Annual Requirement ………………………………………………… 73
4.07 Eligibility Condition to obtain
Advance Authorisation for
Annual Requirement ………………………………………………… 73
4.08 Value Addition ……………………………………………………………. 74
4.09 Minimum Value Addition ………………………………………… 74
4.10 Import of Mandatory Spares …………………………..……… 75
4.11 Ineligible categories of import on
Self Declaration basis ……………………………………………….. 75
4.12 Accounting of Input ………………………………………………….. 76
4.13 Pre-import condition in certain cases ………………….. 77
4.14 Details of Duties exempted …………………………………….. 77
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4.15 Admissibility of Drawback ……………………………………… 78
4.16 Actual User Condition for
Advance Authorisation ……………………………………………. 78
4.17 Validity Period for Import ………………………………………. 79
4.18 Importability / Exportability of items
that are Prohibited/Restricted/ STE ……………………. 79
4.19 Free of Cost Supply by Foreign Buyer ………………….. 80
4.20 Domestic Sourcing of Inputs ………………………………….. 80
4.21 Currency for Realisation of Export Proceeds……… 81
4.22 Export Obligation ……………………………………………………… 82
4.23 Export Obligation Period (EOP) Extension
for units under BIFR/ Rehabilitation. ………………….. 83
4.24 Re-import of exported goods under
Duty Exemption / Remission Scheme ………………….. 83
DUTY FREE IMPORT AUTHORISATION SCHEME
(DFIA) …………………………………………………………………………………………. 83
4.25 DFIA Scheme ………………………………………………………………. 83
4.26 Duties Exempted and Admissibility of
Cenvat and Drawback ………………………………………………. 84
4.27 Eligibility …………………………………………………………………….. 84
4.28 Minimum Value Addition ………………………………………… 85
4.29 Validity & Transferability of DFIA ………………………… 85
4.30 Sensitive Items under
Duty Free Import Authorisation ……………………………. 86
SCHEMES FOR EXPORTERS OF
GEMS AND JEWELLERY …………………………..……………………………. 87
4.31 Import of Input ………………………………………………………….. 87
4.32 Items of Export ………………………………………………………….. 87
4.33 Schemes ………………………………………………………………………. 88
4.34 Advance Procurement/ Replenishment of
Precious Metals from Nominated Agencies ………… 88
4.35 Replenishment Authorisation for Gems ………………. 88
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4.36 Replenishment Authorisation for Consumables .. 89
4.37 Advance Authorisation for Precious Metals. ………. 89
4.38 Value Addition ……………………………………………………………. 90
4.39 Wastage Norms………………………………………………………….. 91
4.40 DFIA not available …………………………………………………….. 91
4.41 Nominated Agencies ………………………………………………… 91
4.42 Import of Diamonds for Certification /
Grading & Re- export ……………………………………………….. 92
4.43 Export of Cut & Polished Diamonds
for Certification/ Grading & Re-import ……………….. 92
4.44 Export of Cut & Polished Diamonds with
Re-import Facility at Zero Duty …………………………..… 92
4.45 Export against Supply by Foreign Buyer …………….. 93
4.46 Export Promotion Tours/
Export of Branded Jewellery ………………………………….. 93
4.47 Personal Carriage of Export / Import Parcels ……. 94
4.48 Export by Post ……………………………………………………………. 94
4.49 Private / Public Bonded Warehouse ……………………. 94
4.50 Diamond & Jewellery Dollar Accounts …………………. 94
4.51 Export of cut & polished precious and
semi–precious stones for treatment and
re-import …………………………………………………………………….. 96
4.52 Re-import of rejected Jewellery …………………………….. 96
4.53 Export and import on consignment basis …………… 96
CHAPTER 5 ………………………………………………………………………………….. 97
EXPORT PROMOTION CAPITAL GOODS (EPCG)
SCHEME ……………………………………………………………………………………… 97
5.00 Objective ……………………………………………………………………… 97
5.01 EPCG Scheme ……………………………………………………………… 97
5.02 Coverage ……………………………………………………………………… 99
5.03 Actual User Condition …………………………………………….. 100
5.04 Export Obligation (EO) …………………………………………… 100
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5.05 Provision for units under BIFR /Rehabilitation . 101
5.06 LUT/Bond/BG in case of Agro units …………………… 102
5.07 Indigenous Sourcing of Capital Goods and
benefits to Domestic Supplier …………………………..….. 102
5.08 Calculation of Export Obligation ………………………….. 102
5.09 Incentive for early EO fulfilment …………………………. 102
5.10 Reduced EO for Green Technology Products …… 103
5.11 Reduced EO for North East Region and
Jammu & Kashmir …………………………………………………… 103
5.12 Post Export EPCG Duty Credit Scrip(s) ………………. 103
CHAPTER 6 ………………………………………………………………………………… 105
EXPORT ORIENTED UNITS (EOUs), ELECTRONICS
HARDWARE TECHNOLOGY PARKS (EHTPs),
SOFTWARE TECHNOLOGY PARKS (STPs) AND BIO–
TECHNOLOGY PARKS (BTPs) …………………………………………… 105
6.00 Introduction and Objective …………………………………… 105
6.01 Export and Import of Goods …………………………………. 105
6.02 Secondhand Capital goods ……………………………………. 108
6.03 Leasing of Capital Goods ……………………………………….. 108
6.04 Net Foreign Exchange Earnings …………………………... 109
6.05 Letter of Permission / Letter of Intent and
Legal Undertaking …………………………………………………… 110
6.06 Investment Criteria …………………………………………………. 111
6.07 Applications & Approvals ……………………………………… 111
6.08 DTA Sale of Finished Products / Rejects /
Waste/ Scrap / Remnants and By-products ……. 111
6.09 Other Supplies ………………………………………………………….. 115
6.10 Export through others ……………………………………………. 117
6.11 Entitlement for Supplies from the DTA ……………… 117
6.12 Other Entitlements …………………………………………………. 119
6.13 Inter Unit Transfer ………………………………………………….. 120
6.14 Sub – Contracting …………………………………………………….. 121
6.15 Sale of Unutilized Material ……………………………………. 123
6.16 Reconditioning / Repair and Re – engineering … 124
6.17 Replacement / Repair of Imported /
Indigenous Goods ……………………………………………………. 124
6.18 Exit from EOU Scheme …………………………………………… 125
6.19 Conversion …………………………..……………………………………. 127
6.20 Monitoring of NFE …………………………………………………… 128
6.21 Export through Exhibitions /
Export Promotion Tours /
Showrooms Abroad / Duty Free Shops ……………… 128
6.22 Personal Carriage of Import /
Export Parcels including through
Foreign Bound Passengers …………………………..……….. 128
6.23 Export / Import by Post / Courier ………………………. 129
6.24 Administration of EOUs / Powers of DC ……………. 129
6.25 Revival of Sick Units ……………………………………………….. 129
