How to find overseas customers for your export business

A country’s economy cannot function in isolation and trade with other countries is a vital function. Exports are a crucial parameter that brings foreign exchange and helps to bolster the country’s foreign reserve. Every country helps the local businesses and India is no exception in promoting its exports. The Ministry of Commerce works towards reducing hurdles in exporting to ensure that a higher number of exporters can conduct their business with ease.  The Indian government also rewards the exporters via several incentive schemes.
The government either provides direct benefits or collects less tax to ensure that the products are competitive in the global markets. The incentives and benefits are reassessed periodically based on the demand/scarcity of the product. As an exporter, knowing which benefits are applicable to your business will help you in increasing the profitability of your business. Let us look at the benefits offered as per the Foreign Trade Policy (FTP) 2015-20.

Advance Authorisation Scheme

This scheme enables exporters to import inputs in the country without any duty paid. This is applicable provided that the inputs will be fully used in the production of an item and the value of export will be at least 15% higher than the value of the imported item. This scheme is valid only for a period of 12 months for import and 18 months for the fulfilment of the export.

Advance Authorization for annual requirement

This scheme is not applicable to new exporters, but only to exporters with a track record of at least 2 years. The exporters following in this category can be offered the benefits of this scheme provided the items fall under SION.

Duty Drawback Scheme

This scheme ensures that the duty paid for inputs against exported products is refunded back to the exporters. The refund will be processed under Duty Drawback. The re-export of the said goods should be completed within the stipulated time. It is important to note that the drawback can be reversed if the sales proceed are not received under stipulated time.

Zero duty EPCG Scheme

The Zero duty EPCG scheme enables the import of capital goods at pre-production, production, and post-production stage without any duty. This is done to enhance India’s production quality as well as the competitiveness. No IGST and compensation cess are applied to these imports. As an exporter, you can leverage this scheme and avail full benefits. The exporter will have to fulfil the obligation within six years of the issuing date.

Merchandise Export from India Scheme

Duty credit scrips are provided to the exporters involved in the export of nearly5000 items. These credit scrips can be utilised by the exporters to pay customsduties, excise duties, and service tax. Only export of notified goods to notifiedmarkets falls under this scheme. A similar scheme called Service Exports fromIndia   Scheme   (SEIS)   is   applicable   to   the   service   industry.   However,   thegovernment is soon planning to do away with this scheme and introduce ascheme called Remission of Duties or Taxes on Export Products’.

© Copyright at Hexponent. All Right Reserved
Term & Condition
Privacy Policy