In February 2009, the government of India announced a change in the tax legislation for exporters.



  • 1 harmful
  • 0 neutral
  • 0 liberalising


Public Notice No. 151 (RE-2008) / 2004-2009

Inception date: 01 Mar 2009 | Removal date: 30 Mar 2015

Tax-based export incentive

 On 26 February 2009, the Government of India notified certain amendments to the Foreign Trade Policy 2004-09, vide Public Notice No. 151 (RE-2008) / 2004-2009. The notification enacts the following changes to the sectoral application of Indian export incentive schemes : 

  • Stapling machines (staplers) are introduced as a new Focus Product, benefitting from the Focus Product Scheme (FPS) (HS Code 8472, w.e.f 1 April 2008).
  • Non-wovens of man-made filaments were included in the list of New High Tech Products (HS Code 5603, w.e.f. 1 April 2008).
  • All handmade carpets and other textile coverings were removed from the Vishesh Krishi Gram Udyog Yojana (VKGUY) Scheme and brought within the ambit of the FPS. (HS Code 0057, w.e.f. 23 February 2009). This listing as a special product under the FPS and the past listing under VKGUY offer similar incentives, equivalent to 5% FOB value of past exports, with some differences in exceptions and application of the respective schemes. 
  • Dried vegetables were included in the list of products eligible for the VKGUY Scheme. (HS Code 0712, w.e.f. 1 April 2008).

The various export incentives grant duty credit scrips, valued at a percentage of the FOB value of exports made, to exporters. Duty credit scrips may be utilized for payment of duty on specified imports, for payment of excise duty or service tax in certain situations, etc. The scrips are also transferable. 
The implementation date has been set to 1 March 2009 as trade flows may only have been affected after the announcement.
The measure was replaced with the announcement of the new Foreign Trade Policy in May 2015.