AFFECTED FLOWOutflow (subsidised)
ANNOUNCED AS TEMPORARYNo
Tax-based export incentive
On 1 May 2015, the Indian Directorate General of Foreign Trade reduced the Export Obligation period under the Advance Authorisation Scheme for products that have "raw sugar" as an input from 18 months to 6 months (from date of import clearance). Under the Advance Authorization Scheme, duty free import of inputs that are physically incorporated in the export goods (here sugar) is provided. These concessions are subject to meeting the export obligations within the specified period.
This measure will have a direct impact on the duty free imports under the said scheme, as the importers will have a reduced time to meet their export obligations from the imported stock. The effect of this measure is to diminish the export incentive afforded by the Advance Authorisation Scheme.
Note that this measure is distinct from a change in the rules on the import of raw sugar under the Duty Free Import Authorisation scheme announced on the same day.
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