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Export Benefits

PROMOTIONAL SCHEMES

In the Foreign Trade Policy 2015-20, under Export from India Schemes, there are two Schemes for exports of merchandise and services viz.:

 

(i) Merchandise Exports from India Scheme (MEIS); and

(ii) Service Exports from India Scheme (SEIS)

 

The objective of MEIS is to offset infrastructural inefficiencies and associated costs involved in export of goods/products, which are produced/ manufactured in India, especially those having high export intensity, employment potential and thereby enhancing India’s export competitiveness. Similarly, the objective of SEIS is to encourage export of notified Services from India.  

Some of the main features of these Schemes are as under:

 

Some of the main features of these Schemes are as under:

 

MEIS

The MEIS Entitlement would be 2% / 3% / 5% / 7% of FOB value of notified goods exported to notified markets [based on three distinct categories framed and covered in Appendix 3B] in free foreign exchange or FOB value of exports as given in the Shipping Bills in free foreign exchange, whichever is less.

Country Groups - Category A: Traditional Markets (30) - European Union (28), USA, Canada. Category B - Emerging & Focus Markets (139), Africa (55), Latin America and Mexico (45), CIS countries (12),Turkey and West Asian countries (13), ASEAN countries (10), Japan, South Korea, China, Taiwan and Category C: Other Markets (70).

SEZ

Units located in SEZs have also been made eligible for MEIS & SEIS benefit.

 

Services Sector

Export of goods through Courier or Foreign Post Offices using e-Commerce (as notified in Appendix-3C) of FOB value only uptoRs. 25,000/- per consignment are entitled for rewards under MEIS.

Under SEIS, Service providers of notified services (under Appendix 3D) will be eligible for rewards in the form of duty credit scrips @ 5% and 7% on the net foreign exchange earned from notified services (w.e.f. 05.12.2017).

Only services provided in the manner/mode specified at Para 9.51 (i) & (ii) are eligible, i.e. Supply of a ’service’ from India to any other country (Mode 1-Cross border trade) and Supply of a ’service’ from India to service consumers of any other country (Mode 2- Consumption abroad).

Minimum net free foreign exchange earnings of USD 15,000 in the preceding year is the eligibility criteria. For Individual Service Providers and Sole Proprietorship minimum USD 10,000/-.

Duty Credit Scrip

Basic Custom duty paid in cash or through debit under Duty Credit scrip shall be adjusted for Duty Drawback benefits.

As per Trade Notice No. 11 dated 30/06/2017, under the GST regime, the Duty Credit Scrips cannot be used for payment of IGST, GST and Compensation cess in inputs and CGST/SGST/IGST, GST and Compensation cess for domestic procurement

Duty Credit Scrip issued on or after 01.01.2016 under Chapter 3 shall be valid for a period of 24 months from the date of issue and must be valid on the date on which actual debit of duty is made.

MAI

Market Access Initiatives (MAI) Scheme to act as a catalyst to promote exports on a focus product- focus country approach, so as to evolve specific markets and products through market studies/surveys.

 

 

STATUS HOLDER

Status Holder Scheme is for business leaders who have excelled in international trade and have successfully contributed to country’s foreign trade.

An applicant shall be categorized as status holder on achieving export performance during the current and previous three financial years (for Gems & Jewellery Sector the performance during the current and previous two financial years shall be considered for recognition as status holder) as under:

Status Category

Export Performance FOB/FOR

(as converted) Value

(in US $ million)

One Star Export House

3

Two Star Export House

25

Three Star Export House

100

Four Star Export House

500

Five Star Export House

2000

 
  
Privileges of Status Holders

A Status Holder shall be eligible for privileges as under:
 
Provision for self-declaration
Authorisation   and   Customs   Clearances   for   both imports   and   exports  may   be   granted   on   self-declaration basis;
Input-Output Norms
Input-Output norms may be fixed on priority within 60 days by the Norms Committee
Banking related provisions
Exemption from furnishing of Bank Guarantee for schemes under FTP, unless specified otherwise anywhere in FTP or HBP
Exemption from compulsory negotiation of documents through banks. Remittance / receipts, however, would be received through banking channels
Two star and above
Two star and above Export houses shall be permitted to establish Export Warehouses as per Department of Revenue guidelines.
Three star and above
Three Star and above Export House shall be entitled to get benefit of Accredited Clients Programme (ACP) as per the guidelines of CBEC (website:http://cbec.gov.in).
Preferential treatment in handling of consignments
The status holders would be entitled preferential treatment   and   priority   in   handling   of their consignments by the concerned agencies.
Provision for self certification of manufactured goods
Manufacturers who  are  also  status  holders (Three Star/Four Star/Five Star) will be enabled to self-certify their manufactured goods (as per their IEM/IL/LOI) as originating from India  with a  view to qualify  for preferential  treatment  under  different  preferential Trading agreements(PTA),  Free Trade  Agreements (FTAs),   Comprehensive  Economic Cooperation Agreements (CECA)  and Comprehensive  Economic Partnership Agreements (CEPA). Subsequently, the scheme may be extended to remaining Status Holders.
Manufacturer exporters who are also Status Holders shall be eligible to self-certify their goods as originating from India as per para 2.108 (d) of Hand Book of Procedures.
Freely exportable items
Status holders shall be entitled to export freely exportable items (excluding Gems and Jewellery, Articles of Gold and precious metals) on free of cost basis for export promotion subject to an annual limit of Rupees One Crore or 2% of average annual export realization during preceding three licensing years, whichever is lower.
Export of Pharma Products
For export of pharma products by pharmaceutical companies, the annual limit would be 2% of the average annual export realization during preceding three licensing years.
In case of supplies of pharmaceutical products, vaccines and lifesaving drugs to health programmes of international agencies such as UN, WHO-PAHO and Government health programmes. The annual limit shall be upto 8% of the average annual export realisation during preceding three licensing years. Such free of cost supplies shall not be entitled to Duty Drawback or any other export incentive under any export promotion scheme. 
 
 
DUTY EXEMPTION/REMISSION SCHEME
 
This Scheme enables exporters’ duty free import of inputs for export production, including replenishment of input or duty remission. 
 
The Duty Exemption Scheme consists of the following:
 
 
Advance Authorisation (AA) (including Advance Authorisation for Annual Requirement)
Allow duty free import of input, physically incorporated in export product, on the basis of Standard Input Output Norms (SION) or Self Declaration. Minimum 15% value addition is required to be achieved. Period for fulfillment of export obligation is 18 months from the date of issue of Authorization.
 
Duty Free Import Authorisation (DFIA)
Issued to allow duty free import of inputs and is exempted only from payment of Basic Customs Duty. Additional Customs Duty/Excise Duty paid may be adjusted as CENVAT credit. Value addition required 20%.
 
 
EPCG SCHEME
 
EPCG Scheme allows import of capital goods for pre-production, production and post-production at Zero customs duty. As per Trade Notice No. 11 dated 30.06.2017 under GST Regime, no exemption from payment of IGST and Compensation Cess would be available for imports under EPCG. However, as per Notification No. 33 dated 13.10.2017, Capital goods imported under EPCG scheme for physical exports are also exempt from whole of the Integrated Tax and Compensation Cess leviable thereon upto 31st March, 2018.
 

 
 
Export Benefits