Advance Authorisation Scheme

What is the Advance Authorisation Scheme?

The Advance Authorisation Scheme is a duty exemption scheme under Chapter 4 of the Foreign Trade Policy 2023, issued by the Directorate General of Foreign Trade in the Ministry of Commerce and Industry. According to Para 4.03 of the FTP, Advance Authorisation is issued to allow duty-free import of input which is physically incorporated in the export product, making normal allowance for wastage. In addition, fuel, oil and catalyst consumed or utilised in the process of production of the export product may also be allowed.

Advance Authorisation is granted before export, not as a refund afterwards. That is the practical difference from duty drawback and RoDTEP, and it is why working capital pressure on import duty largely disappears for exporters who use it well.

The authorisation is issued for inputs in relation to the resultant product on one of four bases:

• Standard Input Output Norms (SION) notified in the Handbook of Procedures.
• Self-declaration under Para 4.07 of the Handbook of Procedures.
• Applicant-specific prior fixation of norms by the Norms Committee.
• Self-Ratification Scheme under Para 4.06 of the FTP.

Related variants sit in the same chapter: Advance Authorisation for Annual Requirement, the Special Advance Authorisation Scheme for apparel and clothing accessories under Chapters 61 and 62 of ITC (HS), and Advance Authorisation for Spices, which is limited to crushing, grinding, sterilisation and manufacture of oils or oleoresins and is not available for simple cleaning, grading or re-packing.

Who is eligible for Advance Authorisation and who cannot apply?

You can apply if you are:

• A manufacturer exporter.
• A merchant exporter tied to a supporting manufacturer.
• Exporting physically, including exports to SEZ; making intermediate supplies; or supplying goods to categories in Paras 7.02(b) to (g) of the FTP, that is, deemed exports.

Advance Authorisation for pharmaceutical products manufactured through a Non-Infringing process is issued to manufacturer exporters only.

You cannot apply, or are not eligible, in these situations:

• You have no export business and no IEC. Advance Authorisation is a trade authorisation issued to an exporting entity. An individual cannot use it to import goods duty free for personal use.
• Prohibited items cannot be exported or imported under Advance Authorisation, unless separately notified. Items reserved for import by State Trading Enterprises cannot be imported against the authorisation, though they can be procured from STEs against an ARO or invalidation letter.
• Self-declaration is barred for several categories under Para 4.11 to vegetable and edible oils under Chapter 15 and oilseeds under Chapter 12, cereals under Chapter 10, most spices and fruits and vegetables carrying basic customs duty above 30%, horn, hoof and animal organs, honey, rough marble blocks and slabs, rough granite, vitamins except for pharmaceutical use, and any item with basic customs duty above 30%.
• The Self-Ratification Scheme is not available for items under Chapters 1 to 24 and Chapter 71 of ITC (HS), biotechnology items and related products, and SCOMET items.
• Gold medallions and coins, and gold jewellery or articles made by a fully mechanised process, are outside Advance Authorisation for precious metals under Para 4.36(d).

What is the value addition requirement?

Value addition under Chapter 4 is calculated as:

VA = (A − B) ÷ B × 100, where A is the FOB value of export realised or FOR value of supply received, and B is the CIF value of inputs covered by the authorisation plus the value of any other input on which drawback is claimed or intended to be claimed.

• Minimum value addition is 15% for Advance Authorisation generally.
• Export products where value addition may be less than 15% are listed in Appendix 4D.
• Tea requires 50% and spices require 25%.
• Gems and jewellery follow Para 4.60 of the Handbook of Procedures.

Import of mandatory spares required to be exported with the resultant product is allowed duty free up to 10% of the CIF value of the authorisation.

How to apply for Advance Authorisation

1. Obtain an IEC on dgft.gov.in and an RCMC from the relevant Export Promotion Council. Ensure a branch or manufacturing unit applying in its own name appears in both the electronic RCMC and the IEC.
2. Identify your norms basis. Check whether SION exists for your export product. If it does not, or you need an additional input beyond the norm, plan for the Self-Ratification Scheme or a Norms Committee application.
3. File ANF 4A online, digitally signed, to the jurisdictional Regional Authority listed in Appendix 1A. No physical copy is submitted. The same form covers SION cases, adhoc norms and self-declaration.
4. Pay the application fee — one per thousand of the CIF value of the authorisation, subject to a minimum of Rs 500 and a maximum of Rs 1,00,000 under Appendix 2K.
5. Import the inputs within 12 months of issue. One revalidation of twelve months from the expiry date is allowed; no further revalidation is given.
6. Manufacture and export within 18 months of the date of issue, indicating the exact input name and quantity on each shipping bill so it matches the authorisation description.
7. Apply online for the Export Obligation Discharge Certificate within six months of the expiry of the export obligation period, linking all shipping bill numbers, bills of export or tax invoices to the authorisation.

If you want to buy the inputs in India rather than import them, ask the Regional Authority for an Advance Release Order or an Invalidation Letter under Para 4.20. Their validity is co-terminus with the authorisation.

How do I check my Advance Authorisation status?

Log in to dgft.gov.in with your IEC credentials and open the Advance Authorisation services dashboard. It shows the file number, authorisation number, CIF value, item-wise import entitlement, export obligation value and quantity, shipping bills linked so far, and EODC status. e-BRC and export realisation data flowing from RBI's EDPMS into the DGFT system are linked to the same shipping bills.

Key deadlines under Advance Authorisation

March 2026 relief: DGFT extended export obligation periods for Advance Authorisations and EPCG Authorisations expiring between 1 March and 31 May 2026 up to 31 August 2026. The extension was granted automatically, with no separate application and no composition fee, citing geopolitical developments affecting global shipping routes, logistics corridors and supply chains.

Conditions that trip exporters up

• Actual user condition. The authorisation and the imported material are non-transferable even after the export obligation is completed. Only the finished product can be disposed of once the obligation is met.
• Input description mismatch. Under Para 4.12, the name and description of the input used must match exactly what is endorsed in the shipping bill. If the specific input and quantity are not indicated in the shipping bill, the authorisation will not be redeemed.
• Pre-import condition. Inputs listed in Appendix 4J, or flagged in SION, must be imported before the export is made.
• By-products and wastage above 5%. Under the Self-Ratification Scheme, where the value of by-products and recoverable wastage exceeds 5% of CIF value, the corresponding quantity of main input is reduced from entitlement.
• Dutiable-goods condition. Where CENVAT or input tax credit was availed on the exported goods, the imported material must be used only in the manufacture of dutiable goods even after export obligation is complete, certified by a Chartered Accountant at EODC stage. An AEO may self-declare.
• Norms Committee audit. Non-availability of production and consumption records is treated as mis-declaration and penalised under the FT (D&R) Act. Where a Chartered Engineer has been party to mis-declaration, the case is referred to the Institute of Engineers India.
• Penalty for prohibited-item cases. For items allowed under Para 4.05 of the Handbook of Procedures, non-fulfilment attracts a penalty of five times the CIF value of imported material corresponding to the shortfall.

Extension, clubbing and regularisation

Extension of the export obligation period for Appendix 4J authorisations is allowed for not more than half the stipulated period, on payment of a composition fee graded by CIF value of the authorisation. The lowest slab applies up to Rs 2 crore, a middle slab from Rs 2 crore to Rs 10 crore, and a higher slab above Rs 10 crore. Clubbing of authorisations is permitted where EODC has not already been issued, subject to the conditions in the Handbook of Procedures.

Drawback under Para 4.15 remains available at the rate fixed by Customs for duty paid imported or indigenous inputs not specified in the norms, provided those duty-paid inputs are declared in the application and endorsed in the condition sheet of the authorisation.

Where to get help

• DGFT toll-free helpdesk: 1800-111-550 or 1800-572-1550
• DGFT EDI helpdesk email: dgftedi[at]nic[dot]in
• Jurisdictional Regional Authority in Appendix 1A, which issues the authorisation, fixes norms and grants the EODC
• Norms Committee at DGFT headquarters for norms fixation where SION does not exist
• Policy Relaxation Committee through the DGFT portal for genuine hardship

DGFT has warned exporters about spurious websites imitating the DGFT site and collecting money. File only on dgft.gov.in.

Common reasons for rejection

Advance Authorisation applications and EODC claims are refused or held up for a narrow, predictable set of reasons. Most trace back to a mismatch between what was declared in ANF 4A and what SION, the Handbook of Procedures, or the shipping bill actually allow.

No SION exists for the export product, and the application does not choose a valid alternate route. Filing a plain ANF 4A without picking self-declaration under Para 4.07, a Norms Committee application, or the Self-Ratification Scheme gets returned by the Regional Authority. The fix is to identify the correct norms basis before filing, not after a query is raised: check the SION database first, and if none exists, attach the self-declaration or prior fixation request in the same application.

Self-declaration is claimed for a barred item. Para 4.11 excludes vegetable and edible oils, oilseeds, cereals, most spices, fruit and vegetables with basic customs duty above 30%, animal-derived items, honey, rough marble and granite, and vitamins outside pharmaceutical use, along with any item carrying basic customs duty above 30%. An application self-declaring norms for one of these is rejected outright. The fix is to route these items through the Norms Committee for prior fixation instead of self-declaration.

Self-Ratification Scheme used for an ineligible item or an ineligible applicant. The scheme does not apply to Chapters 1 to 24 or Chapter 71 of ITC (HS), biotechnology items, or SCOMET items, and it is open only to AEO-certified exporters or two-star and above status holders who have applied for AEO. An application from a non-status-holder without an AEO application attached is refused. Confirm AEO or status-holder standing, and the chapter classification of the item, before choosing this route.

Declared value addition falls short of the 15% floor, or the required higher floor. Value addition is (FOB value realised minus CIF value of covered and drawback-claimed inputs) divided by that input value. Tea needs 50% and spices need 25%; anything below the applicable floor, unless the product is listed in Appendix 4D, is rejected at the norms-fixation or EODC stage. The fix is to recompute value addition against actual FOB and CIF figures before filing, and check Appendix 4D for a lower permitted threshold if the margin is genuinely thin.

IEC and RCMC particulars do not match. Where a branch office or manufacturing unit applies in its own name, that name must appear identically in both the electronic RCMC and the IEC. A mismatch between the two records is a standard reason for the Regional Authority to return the file rather than process it. Update the RCMC or IEC to align the entity name before submission.

Import consignment does not match the authorisation description at the input level. Para 4.12 requires the exact name and quantity of the input used to be indicated on the shipping bill. If customs clearance uses a generic or differently worded description than the one endorsed on the authorisation, the shipment cannot be linked and the authorisation is not redeemed against it. Match the input description word for word with what is endorsed on the authorisation before filing the shipping bill.

Pre-import condition is missed for Appendix 4J or SION-flagged inputs. Certain inputs must be imported before the corresponding export is made. Exporting first and importing later against these specific inputs invalidates that leg of the authorisation. Check Appendix 4J and the SION entry for a pre-import flag before sequencing shipments.

Export obligation is not met within 18 months and no extension is sought in time. Missing the window without applying for extension, where eligible under Appendix 4J, converts the case into a duty-recovery-with-interest matter and can draw a show cause notice under the FT (D&R) Act rather than a routine rejection. Track the 18-month clock from date of issue and file for extension, with the composition fee for the applicable CIF slab, before the deadline lapses rather than after.

EODC application is filed late or without linked shipping bills. EODC must be applied for online within six months of expiry of the export obligation period, with every shipping bill, bill of export or tax invoice linked to the authorisation. Filing without complete linkage, or filing a manual application for non-EDI shipping bills after the two-month window, results in the EODC being withheld pending correction. Reconcile all shipping bill numbers against the authorisation before submitting the EODC request.

Chartered Accountant or Chartered Engineer certification is missing or from a disqualified professional. Where CENVAT or input tax credit was availed on the exported goods, a Chartered Accountant certificate is required at EODC stage unless the applicant is an AEO able to self-declare; the Self-Ratification Scheme separately requires a Chartered Engineer certificate from someone not penalised in the preceding five years. A certificate omitted, or issued by a penalised professional, is grounds for the Regional Authority to reject that part of the claim. Verify the certifying professional's standing and attach the certificate in the prescribed format.

Imported material or the authorisation itself is treated as transferred. The actual user condition under Para 4.16 makes both the authorisation and the imported material non-transferable even after the export obligation is fulfilled. Evidence of sale or transfer of the unused material, rather than the finished product, is treated as a violation rather than a documentation gap, and draws recovery action instead of a simple rejection. Only the finished product manufactured from the duty-free input may be disposed of once the obligation is met.