Export Benefit Schemes India | All you need to know

India is expecting to become a $5 Trillion economy by 2025, and exports can play a crucial role. A high export growth rate would be the primary objective while keeping the average GDP growth rate above 9%. For achieving the target, one condition is by tripling India’s Export up to $1 Trillion by the same year.

What are Export Incentives?

Export Incentives are regulatory, monetary, legal, or tax programs designed or implemented to encourage businesses to export certain specific types of goods or services. Exports are goods that are produced in one nation and then transported to another nation for trade purposes.

These export incentives are acknowledged by the Government for bringing in foreign exchange, and as compensation for the costs, traders incur for trading goods and services to other nations. The incentives provided for exports align with the “Make in India” and “Atmanirbhar Bharat” programs aiming to achieve self-sufficiency.

1.      Export Promotion Schemes

a.      The Remission of Duty or Taxes on Export Products (RoDTEP) Scheme:

The scheme is based on the globally accepted principle that taxes and duties should not be exported, and taxes and levies are borne on the shipped products should either be exempted or remitted to exporters. The Remission of Duty or Taxes on Export Products RoDTEP scheme reimburses exporters for embedded central, state, and local taxes and duties previously not rebated.

Specific export incentives schemes are ineligible under this Scheme, like exports to Special Economic Zones (SEZ), Export Oriented Unit (EOUs), and jobbing units (which process raw material or semi-finished goods) as well as exports made against Advance Authorization.

Features of RoDTEP Scheme:

·         Refund for duties and taxes which were previously not refundable.

·         The automated system of Credit

·         An introduction to Digital Platform helping in Quick Verification.

·         It ensures uniformity across all the sectors.

·         Import, Trade, Export benefits for MSMEs.

b.      Export Promotion Capital Goods (EPCG) Scheme:

As per DGFT, this scheme aims “to facilitate the import of capital goods to produce quality goods and services and enhance India’s manufacturing competitiveness”.

Capital goods for pre-production, production, and post-production can now be imported at 0% customs duty under EPCG – the Scheme is also called Zero Duty EPCG.

Other service providers eligible for export benefits in India are hotels, tour operators, taxi firms, logistics companies, and construction firms.  

2.      Duty Exemption & Remission Schemes

The scheme enables duty-free import of inputs for export production with the export obligation. This Scheme consists of: -

·         Advance Authorization Scheme

·         Advance Authorization for annual requirement

·         Duty-Free Import Authorization (DFIA) Scheme

·         Duty Drawback of Customs

·         Interest Equalization Scheme (IES)

3.      Other Schemes

·         Towns of Export Excellence (TEE)

·         Market Access Initiative (MAI) Scheme

·         Status Holder Scheme

·         Gold Card Scheme

These schemes are primarily implemented for creating competitiveness in the global market. It has been taken to support domestic industry, mainly to avail export benefit in India for MSMEs and reform the export-centric industry by introducing a better mechanism to increase its competitiveness, boost exports, generate employment and contribute to the overall economy. Professionals at ASC Group can assist your firm to evaluate & avail of maximum benefits as per the policy regulations. 

Location: India

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