Export incentives are a form of economic assistance that governments provide to firms or industries within the national economy, in order to help them secure foreign markets. A government providing export incentives often does so in order to keep domestic products competitive in the global market.
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2. Export i ncenti ves are benefi ts
that exporters recei ve from the
governmentas acknowl edgement
for bri ngi ng i n forei gn exchange
and ascompensati on for the
costs they i ncur on sendi ng
goods and servi ces out of the
country.
3. TH IS M A Y IN CL U D E S U B SID IE S, TA X C O N C E SSIONS , C RE DI T
F A C IL ITIE S A N D F IN A N CIA L G UA R A N TE E S.
IN IN DIA , E X P O R T IN CE NTIV E S A R E IN L IN E W IT H TH E
G O V E R N M E N T ’ S F L A GS HIP “M A KE IN IN D IA ” A N D
“ A TM A N IR B HA R B HA R A T ” P R O G R A M M E S. TH E SE I NC E NTI V E S
A R E H IG HL IGHT E D IN A D O C UM E N T C A L L E D TH E ' F O RE I G N
TR A D E P O L ICY . '
4. WHO IMPLEMENTS EXPORT INCENTIVES?
IN IN DIA , E X P O R T IN CE NTIV E S A R E IN L IN E W IT H TH E
G O V E R N M E N T ’ S F L A GS HIP “M A KE IN IN D IA ” A N D
“ A TM A N IR B HA R B HA R A T ” P R O G R A M M E S. TH E SE I NC E NTI V E S
A R E H IG HL IGHT E D IN A D O C UM E N T C A L L E D TH E ' F O RE I G N
TR A D E P O L ICY . '
A C O U N TR Y ’ S E X P O R T IN C E N TIV E S M IGHT B E CO N S ID E R E D A S
U N F A IR TR A D E P R A CT ICE B Y A N O TH E R C O UN TR Y . W H E N
D IS P U TE S A R IS E B E T W E E N C O UN TR IE S O V E R TH E L E V E L O F
G O V E R N M E N T IN V O L V E M E N T IN F O R E IG N TR A D E , TH E S E A RE
S E TT L E D B Y T HE W O R L D TR A D E O R G A N ISA TIO N.
5. Export i ncenti ves make cross-border
trade benefi ci al . The government
col l ects l ess tax on an export product,
maki ng i t more gl obal l y competi ti ve.
Thi s, i n turn, ensures the product has
a wi der reach i n the i nternati onal
market.
HOW DO EXPORT
INCENTIVES WORK?
8. RoDTEP
T H E R E M ISSIO N O F D U TY O R TA X E S O N E X P O R T P RO DUC TS
( R O D T E P ) SCHE M E R E IM B U R S E S E X P O R T E R S F O R E M B E D D E D
C E N T R A L , ST A T E A N D L OC A L TA X E S A N D D UTIE S TH A T W E RE
P R E V IO U SL Y N O T R E B A TE D . R E F UN D S A R E C R E DI TE D TO A N
E X P O R TE R ’S L E D GE R A CC O UN T W ITH C USTO M S A ND C A N BE
U S E D TO P A Y CU S T O M S D UTY O N IM P O R TS O R TRA NS F E RRE D
TO O THE R IM P O R T E R S . TA X E S/D UTIE S C O V E R E D I NC L UDE :
CE N TR A L / STA T E T A X E S O N F UE L C OA L C E SS
MA N DI TA X
S TA M P DU TY O N
IM P O R T- E X P O R T
D O C U M E N TA T IO N
STA TE E L E C TR ICIT Y
D U TY
T OL L T A X
9. SERVICE EXPORTS FROM INDIA SCHEME
(SEIS):
U N D E R THIS S CHE M E , E X P O R TE R S O F E L IG IB L E SE R V ICE S
R E C E IV E IN CE N T IV E S IN TH E F O R M O F D UTY C RE DI T S C RI P S A T
A R A T E O F 3 %- 7% O F T HE N E T F O R E IG N E X C H A NG E E A RNE D.
TH E Y A R E A L S O T R A N S F E R A B L E ( C A N B E P A SSE D O N TO
A N O T H E R TR A D E R ) .
C . E X P O R T P R O M O T IO N C A P IT A L GO O D S ( E P CG) SC H E M E :
U N D E R E P CG, W HICH IS A L SO C A L L E D Z E R O D UTY E P C G ,
C A P ITA L GO O D S T HA T A R E F O R P R E - P R O D UC TI O N,
P R O D U C TIO N A N D P O S T- P R O D UC TIO N C A N B E I MP O RTE D A T
0 % C U STO M S D U T Y . T HE D UTY E X E M P TIO N A L SO E X TE NDS TO
IN TE G R A TE D GS T ( IGS T) A N D C O M P E N SA TIO N C E S S .
11. I t al l ows duty-free i mport of raw
materi al i n products made for export,
provi ded a mi ni mum 15% val ue addi ti on
i s made to the fi nal product. The
scheme covers any fuel , catal yst,
packagi ng materi al used i n producti on.
You can appl y for an AA l i cence on
the DGFT websi te.
ADVANCE AUTHORISATION
(AA)
12. Under AA, exporters can al so appl y
for advance authori sati on on an
annual requi rement basi s. However,
onl y exporters wi th a “status hol der”
certi fi cate or wi th past export
performance are el i gi bl e.
ADVANCE AUTHORISATION
FOR ANNUAL REQUIREMENT
13. Li ke AA, thi s scheme al l ows the
duty-free i mport of i nputs. Unl i ke AA,
however, i mports under DFI A can be
made onl y after the export i s compl eted,
the scheme appl i es onl y to products
covered by SI ON, i t comes wi th a 20%
val ue-addi ti on requi rement, and i t i s
exempt onl y from payment of basi c
custom duty.
DUTY-FREE IMPORT
AUTHORISATION (DFIA)
14. Rebate of State and Central Levies and
Taxes (RoSCTL) Scheme
U N D E R IT, E X P O R T E R S OF R E A D Y - M A D E A P P A R E L A N D M A D E -
U P G O O DS A R E E L IGIB L E F O R TR A N SF E R A B L E A N D S E L L A BL E
D U TY C R E DI T S CR IP S O N TH E B A SIS O F TH E E X P O RT F O B
V A L U E . THE M A X IM U M R E B A TE R A TE IS 6 .0 5% F O R A P P A RE L
A N D 8 . 2% F O R M A D E - U P S.
TH E S C H E M E C O V E R S T HE F O L L O W IN G C E N TR A L A N D S TA TE
TA X E S / DU TIE S :
C E N T R A L E X C ISE
D U TY A N D V A T O N
F U E L
M A N DI TA X
C G S T / SGST
S TA M P D U T Y
E L E C T R IC IT Y D U TY
15. Under the Export Ori ented Uni t (EOU),
El ectroni cs Hardware Technol ogy
Park (EHTP), Software Technol ogy
Park (STP) and Bi o-Technol ogy
Park (BTP) schemes, enterpri ses
ai mi ng to export 100% of thei r
i nventory may be set up.
EOU/EHTP/STP/BTP
SCHEMES
