The recent notification (No. 69/2023 dated March 7, 2024) issued by the Directorate General of Foreign Trade ( DGFT ), for facilitating trade for holders of Advance Authorisation and Export Oriented Units ( EOUs ) in India.
The notification introduced provisions aimed at exempting imported inputs from mandatory Quality Control Orders ( QCOs ), aligning with the objectives outlined in the Foreign Trade Policy ( FTP ), 2023, and the Foreign Trade ( Development & Regulation ) Act, 1992.
The notification has inserted para 4.18A under FTP 2023, which delineates the importability of items under Advance Authorisation and EOUs without mandatory QCOs. This includes stipulations such as pre-import conditions, explicit endorsement of exemption in the authorisation, and stringent regulations concerning unutilized imports.
The notification emphasised that the exemption from QCOs applies solely to physical exports and not to deemed exports for Advance Authorisation holders. Additionally, it clarified that certain facilities, such as clubbing under para 4.36 of the Handbook of Procedures ( HBP ) 2023, are not applicable under these provisions. The notification also provides guidance on the EO period for such authorizations, ensuring transparency and adherence to regulatory frameworks.
Furthermore, sub-paras appended to existing sections of FTP 2023, particularly under para 4.24 and para 6.07, serve to reinforce restrictions on imports without compliance with mandatory QCOs under the Duty-Free Import Authorization ( DFIA ) scheme. Additionally, exemptions are granted to EOUs for the importation of inputs necessary for export production.
The notification has listed Ministries/Departments, such as the Ministry of Steel and the Department for Promotion of Industry and Internal Trade ( DPIIT ), in Appendix 2Y of FTP 2023, for exempting their mandatory QCOs pertaining to goods utilised or consumed in the manufacture of export products.
In essence, the notification endeavours to simplify import procedures for Advance Authorisation holders and EOUs while upholding stringent quality standards. By exempting specified inputs from mandatory QCOs, it seeks to enhance the ease of conducting export-oriented activities, ultimately contributing to India’s competitiveness in the global trade landscape.
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