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Advance Authorisation Scheme : Directorate General of Foreign Trade

Advance Authorisation Scheme : Directorate General of Foreign Trade


The Directorate General of Foreign Trade (DGFT) implemented the Advance Authorisation Scheme.

  • The Scheme was implemented under the Foreign Trade Policy. It allows duty-free import of inputs for export purposes.

Advance Authorisation Scheme:-

  • Launched: 2015. (Advance Authorization Scheme (AAS))
  • Ministry: Ministry of Commerce and Industry.
  • Objective: to make India’s products competitive in the global market.
  • It is a type of duty exemption scheme introduced by the Government of India under the Foreign Trade Policy 2015-2020.
  • Under this scheme, exemption from the payment of import duties is given to raw materials/inputs required for the manufacture of export products.
  • They are not allowed to sell the products in the domestic market.
  • Advance Authorization is valid for 12 months from the date of issue of such Authorization.
  • The revised composition fee formula is based on a specific rate for different levels of the ‘CIF (cost, insurance, freight) value of authorization.
  • The fees levied under these 3 slabs:-
    • ₹5,000 for a cost, insurance, freight (CIF) value of advance authorization license valued at up to ₹2 crores.
    • ₹10,000 for a value between ₹2 crore and 10 crores
    • ₹15,000 for value over ₹10 crores.
  • The simplification of calculations for composition fees helps in automation and faster service delivery by making the process more efficient and easier to understand.
  • The eligibility of inputs is determined by Sector-specific Norms Committees based on input-output norms.
  • The quantity of inputs allowed for a given product is based on specific norms defined for that export product, which considers the waste generated in the manufacturing process.
  • DGFT provides a sector-wise list of Standard Input-Output Norms (SION) under which the exporters may choose to apply.