Context:
The government has relaxed norms under the Advance Authorisation (AA) Scheme to benefit exporters. Exporters can now claim duty-free benefits even if goods were shipped before licence issuance, provided the Bill of Entry is filed after the licence date.
About the Advance Authorisation Scheme
- Purpose: Allows duty-free import of inputs used in manufacturing export products to reduce input costs and enhance the competitiveness of Indian exports globally.
- Administered by: Directorate General of Foreign Trade (DGFT), Ministry of Commerce and Industry.
Key Features
- Duty-Free Import: Raw materials, packaging materials, fuel, oil, and catalysts can be imported without customs duty.
- Standard Input-Output Norms (SION): Sector-specific norms guide the permissible input quantities; ad-hoc norms can be applied if SIONs do not exist.
- Eligibility: Manufacturer exporters and merchant exporters linked with supporting manufacturers.
- Physical Incorporation Principle: Inputs must be physically used or consumed in the final export product.
Recent Relaxation in Rules
- Previous Norm: Duty exemption was denied if goods were shipped before the AA licence was issued, even if the Bill of Entry was filed later.
- New Norm: Exporters can claim duty-free benefits if the Bill of Entry is filed after licence issuance, regardless of shipment date.
- Restriction: This relaxation does not apply to restricted or canalised goods unless special approval from DGFT is obtained.
Impact
- Resolves ambiguity around shipment and licence dates.
- Streamlines Customs clearance processes for exporters.
- Enhances exporter confidence amid logistical challenges and delays.
