STE policy items*

Member: 

Basic information

1

Outline of the system

The Foreign Trade Policy 2015-2020, was notified in the Gazette of India vide Notification No.01/2015-2020 dated 1 April 2015 and subsequently revised and notified vide Notification No. 41/2015-2020 dated 5 December, 2017. The category of imports under the current Foreign Trade Policy consists of: (i) prohibited items, import of which are normally not allowed, (ii) restricted items, imports of which are allowed against an authorisation or in accordance with a public notice which indicates the conditions under which the items can be imported, (iii) those under state trading enterprises (STE) policy, the imports of which are permitted only through the designated STEs, and (iv) those which can be freely imported.

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Product coverage

All items may be imported without any restriction except for the restrictions indicated in the book titled ITC (HS) Classifications of Export and Import Items, or any other provisions or law in force as amended from time to time. To facilitate the importation of the restricted items, an import licensing system has been adopted.
The policy and procedures governing imports of various items is given in the Foreign Trade Policy which is valid for a specified period. The Handbook of Procedures is also published to supplement the Foreign Trade Policy. In terms of Foreign Trade Policy (2015-2020), imports of all items, other than the prohibited and restricted items, are allowed without any restriction. There are also few items which are restricted for import only through State Trading Enterprises (STEs). The restricted items are imported against specific import authorisations or in accordance with Notifications/Public Notices issued for this purpose.

Importability of an individual item can be determined as per the policy indicated against such item in the ITC (HS) Classifications of Export and Import Items. This compilation adopts the internationally accepted Harmonized System (HS) of Commodity Classifications as adopted by the Customs Cooperation Council (CCC), Brussels. The code classification adopted is at the eight-digit level so as to provide a distinct existence to certain products. For the purposes of distinct identity, these codes are called Exim Codes indicating import policy of the goods against such codes/products. This publication is very helpful in ascertaining the import policy of various products as covered by the respective Exim Codes in different Chapters.

Some of the items presently under restriction include live animals, including fish, planting material (seeds), stones, metal waste, radioactive material, psychotropic drugs, ozone depleting substances, arms and ammunition, explosives, plastic waste, certain new pneumatic tyres, sandalwood, security printing paper, nuclear reactors and parts thereof, radio and television broadcast transmitters, palm oil, power tiller and components, colour television sets, communication jamming equipment, aircraft, including helicopters and items covered under the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES), Chemical Weapons Convention (CWC) or other similar domestic/international legislation.

Main licensing systems:

Grant of import authorisation for restricted items: An application for import of such items may be made to the Directorate General of Foreign Trade (DGFT) or any other regional authority authorized by him on his behalf. The licensing authority may take the assistance and advice of a licensing committee. The licensing committee will consist of representatives of technical authorities.

Nature of licensing

Automatic

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If Automatic, administrative purpose

Non-Automatic

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If Non-Automatic, description of the notified Non-Automatic Licensing regime

Restricted non-automatic licensing

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Products under restriction as to the quantity or value of imports

The restrictions on imports are maintained on grounds as notified in Paragraph 2.07 of Foreign Trade Policies and include protection of human health or safety; animal or plant life or health; security and the environment. In respect of certain items, the conditions for import have been specified in a general way in public notices issued for this purpose and the need for licensing in individual cases has been eliminated.

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Questions for products under restriction as to the quantity or value of imports

A quota system is generally not adopted.

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The system applies to products originating from which country?

All of India's trading partners receive MFN treatment in the issue of import authorisations.

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Expected duration of licensing procedure

Ongoing

Eligibility of applicants

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Is there a system of registration of persons or firms permitted to engage in importation?

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What persons or firms are eligible to apply for a licence?

All eligible persons, firms and institutions can apply for an authorisation provided they hold a valid importer/exporter code number (IEC)

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Is there a registration fee?

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Is there a published list of authorized importers?

Contact point for information on eligibility

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Ministry/Authority

Ministry of Commerce & Industry, Directorate General of Foreign Trade

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Address

Udyog Bhawan, Maulana Azad Road, New Delhi-110011

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Telephone

1800111550

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Fax

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E-mail address

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Contact officer

Submission of an application

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Administrative body(ies) for submission of an application

Ministry of Commerce & Industry, Directorate General of Foreign Trade

Documentation requirements

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What information is required in applications?

The application form indicates the type of information and the documents normally required for processing the application. The application format for import of restricted items is given in Aayaat-Niryaat Form (Import-Export Form) of the Handbook of Procedures, Vol.1. This form is also available on the DGFT website: https://dgft.gov.in/CP/

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What documents is the importer required to supply with the application?

The application form indicates the type of information and the documents normally required for processing the application. The application format for import of restricted items is given in Aayaat-Niryaat Form (Import-Export Form) of the Handbook of Procedures, Vol.1. This form is also available on the DGFT website: https://dgft.gov.in/CP/

Window of submission of an application

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How far in advance of importation must application for a licence be made?

The authorisations are valid for goods already shipped/arrived at the customs' ports but not already cleared by customs.

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Are there any limitations as to the period of the year during which application for licence can be made? If so, explain

No.

Issuing the license

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Can a licence be granted immediately on request?

Yes, if the applicant fulfils the legal requirements

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Can licences be obtained within a shorter time-limit or for goods arriving at the port without a licence

The authorisations are valid for goods already shipped/arrived at the customs' ports but not already cleared by customs.

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Which administrative body is responsible for approving application of licences?

The importer has to approach the DGFT for an import authorisation.

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Must the applications be passed on to other organs for visa, note or approval?

The applicants need not approach other authorities for a visa note or approval. Only single administrative clearance is required.

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Are there any other conditions attached to the issue of a licence?

Authorisations are only required to import restricted items mentioned in paragraph 2 above. These authorisations are issued with Actual User Condition unless Actual User Condition is specifically dispensed with.

Fees and other administrative charges

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Is there any licensing fee or administrative charge?

Details of fee are given in Appendix 2-K of Foreign Trade Policy which is available at DGFT's website https://dgft.gov.in/CP/

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What is the amount of the fee or charge?

Details of fee are given in Appendix 2-K of Foreign Trade Policy which is available at DGFT's website https://dgft.gov.in/CP/

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Is there any deposit or advance payment required associated with the issue of licences?

There is no deposit or advance payment requirement associated with the issue of import authorisations.

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Amount or rate?

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Is it refundable?

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What is the period of retention?

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What is the purpose of this requirement?

Refusal of an application

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Under what circumstances may an application for a licence be refused other than failure to meet the ordinary criteria?

The licensing authority may refuse to grant an import authorisation:
i. if the applicant has contravened any law relating to customs or foreign exchange;
ii. if it has been decided by the Central Government to import through State Trading Enterprises and distribution thereof through special or specialized agencies;
iii. if any action against the applicant is pending under the Foreign Trade (Development and Regulation) Act, 1992, or rules and orders made thereunder;
iv. if the applicant fails to pay any penalty imposed on him under the said Act; and
v. if the applicant is not eligible for an authorisation in accordance with any provisions of the Export and Import Policy.

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Are the reasons for any refusal given to applicants?

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Have applicants a right of appeal in the event of refusal to issue a licence?

Paragraph 2.14 of the Foreign Trade Policy (FTP) (2015-2020) clearly mentions that no person may claim an authorisation as a right and the DGFT or its Regional Authorities have the power to refuse to grant or renew the same.

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If so, to what bodies and under what procedures?

However, as per paragraph 2.59 of the FTP, the DGFT has a Citizen's Charter and also a Grievance Redressal Mechanism to address the grievances of exporters and importers. The details are available at DGFT's website http://dgft.gov.in/.

Importation

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Are there any limitations as to the period of year during which importation may be made?

No.

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What documents are required upon actual importation?

The documents required upon actual importation are, besides the import authorisation, shipping documents and commercial invoices. Pre-shipment Inspection Certificate, Phyto-sanitary Certificate and Certificate of Origin are to be submitted on importation if the import policy mandates so.

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Are there any other administrative procedures, apart from import licensing and similar administrative procedures, required prior to importation?

No

Conditions of licensing

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What is the period of validity of a licence? Can the validity be extended? How?

As per paragraph 2.16 of the Handbook of Procedures, 2015-2020, an import authorisation shall normally be endorsed with a period of validity of 18 months. The authorisation may be revalidated for a period of six months by the licensing authority on merit.

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Is there any penalty for the non-utilization of a licence or a portion of a licence?

No.

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Are licences transferable between importers? If so, are any limitations or conditions attached to such transfer?

No.

Foreign Exchange

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Is foreign exchange automatically provided by the banking authorities for goods to be imported?

Yes. There is no restriction on foreign exchange for import. Foreign exchange is provided by the authorized dealers for the import of goods.

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Is a licence required as a condition to obtaining foreign exchange?

However, for the import of items appearing in the restricted category, an import authorisation is required.

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Is foreign exchange always available to cover licences issued?

Normal banking procedures apply for obtaining foreign exchange.

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What formalities must be fulfilled for obtaining the foreign exchange?

Normal banking procedures apply for obtaining foreign exchange.