Export Incentives & Schemes

Key facts

• Foreign Trade Policy 2023 took effect on 1 April 2023 with no fixed end date; it is updated as needed rather than every five years.
• Duty Drawback refunds customs and central excise duties on inputs used in exported goods, at All Industry Rates (AIR) notified by HS code or at brand rates. It is claimed through the shipping bill.
• RoDTEP (Remission of Duties and Taxes on Exported Products) refunds embedded taxes not otherwise refunded, as a percentage of FOB value, given as transferable e-scrips. Check the current rate schedule and scheme validity on DGFT.
• Advance Authorisation allows duty-free import of inputs used to make export products, with an export obligation.
• EPCG allows import of capital goods at zero customs duty, with an export obligation of 6 times the duty saved within 6 years.
• Status holders (One Star to Five Star Export House) get faster clearances and other facilitation based on export performance.

Common questions

What is duty drawback?

A refund of customs (and certain central) duties paid on inputs used in exported goods. Most exporters claim All Industry Rates (AIR) notified per HS code, directly in the shipping bill, and the amount is credited to the bank account linked to the AD code.

What is RoDTEP?

A scheme that refunds embedded central, state and local taxes not otherwise refunded (like fuel duties and electricity duty) as a percentage of FOB value. Benefits come as e-scrips that can be used to pay customs duty or sold. Rates and validity are notified by DGFT.

What is the EPCG scheme?

Export Promotion Capital Goods: import machinery at zero customs duty, and export goods worth 6 times the duty saved within 6 years.

What is Advance Authorisation?

A licence to import inputs duty-free for making export products, subject to an export obligation, usually within 18 months.

Sources

• Foreign Trade Policy 2023 and Handbook of Procedures (DGFT)