Advance Authorisation (AA)

What is Advance Authorisation?

Advance Authorisation (AA) is a duty-exemption scheme administered by the Directorate General of Foreign Trade (DGFT) under the Ministry of Commerce and Industry. According to the DGFT portal, Advance Authorisation permits the duty-free import of inputs that are "physically incorporated in an export product," together with packaging material, fuel, oil and catalysts consumed in the course of producing the export goods.

The scheme rests on a simple principle: inputs that go into exports should not carry the burden of import duties, because the finished goods are sold abroad and earn foreign exchange. By exempting these inputs from Basic Customs Duty and certain other levies at the point of import, Advance Authorisation lowers the working-capital cost of manufacturing for export and keeps Indian exporters price-competitive.

Advance Authorisation is governed by Chapter 4 of the Foreign Trade Policy (FTP) and the corresponding Handbook of Procedures. It is a trade-facilitation instrument for businesses, not an individual welfare benefit.

Who is eligible for Advance Authorisation?

You can apply if:

• You are a manufacturer exporter who makes the export product yourself, or
• You are a merchant exporter tied to a supporting manufacturer named in the application, and
• You hold a valid Importer-Exporter Code (IEC) issued by DGFT, and
• You hold a Registration cum Membership Certificate (RCMC) from the relevant Export Promotion Council or commodity board.

Advance Authorisation is also available for specified categories such as supplies to projects, deemed exports and, in some cases, the annual requirement of status holders and regular exporters, subject to the conditions in the FTP.

You cannot apply if:

• You are an individual seeking duty-free imports for personal use, the scheme carries an actual-user condition tied to exports.
• You do not have an IEC, or the intended import is not an input physically incorporated in an export product.
• You cannot meet the minimum value-addition requirement or the export obligation attached to the authorisation.

The imported inputs carry an actual-user condition: they cannot be sold or transferred in the domestic market until the export obligation is discharged and the authorisation is redeemed.

How much benefit does Advance Authorisation provide?

There is no fixed rupee ceiling. The benefit equals the customs duty saved on the inputs you are allowed to import duty-free, which depends on the value and duty rate of those inputs. The allowed quantity of each input is governed by the Standard Input-Output Norms (SION) for the export product, which build in an allowance for manufacturing wastage. Where no SION is notified, the exporter can approach the Norms Committee for fixation of ad-hoc norms.

Against this exemption, the exporter takes on two core obligations:

• A minimum value addition of 15% for most products (higher for a few notified items), and
• An export obligation: exporting the resulting goods, typically to be completed within 18 months from the date the authorisation is issued.

What documents are required for Advance Authorisation?

How to apply for Advance Authorisation

1. Ensure you hold a valid IEC and an RCMC, and register a Class 3 Digital Signature Certificate on the DGFT portal at dgft.gov.in.
2. Log in and open the Advance Authorisation service under the "Services" menu, then start a new authorisation application.
3. Enter the export product, the inputs required, and the applicable SION; if no SION exists, file for norms fixation with the Norms Committee.
4. Declare the value addition and export obligation you undertake, and upload the supporting documents.
5. Pay the application fee, digitally sign and submit; the system generates the authorisation once approved.
6. After exports are completed, file for redemption / closure (EODC — Export Obligation Discharge Certificate) with proof of exports and consumption within the prescribed period.

The portal also handles amendments, revalidation, invalidation, and closure, and lets you track the status of your authorisation with customs.

Where to get help

• DGFT Toll Free Helpdesk: 1800-111-550
• DGFT portal: dgft.gov.in; raise an e-ticket through the online helpdesk
• Your Export Promotion Council can advise on RCMC and product-specific norms

Advance Authorisation is a specialised trade scheme. Exporters commonly work with a customs broker or trade consultant to prepare SION references, value-addition calculations and the export-obligation documentation, but the application itself is filed on the DGFT portal under the exporter's own IEC.

How to check your application status

Advance Authorisation applications, and the authorisations issued against them, are tracked on the DGFT portal itself rather than through a separate status-check page.

1. Log in at dgft.gov.in with the IEC credentials used to file the application.
2. Go to Services > Advance Authorisation and open "View / Track Application" (the exact label can vary slightly between portal updates, it sits under the same Advance Authorisation service menu you applied through).
3. Search by the file number or ARN (Application Reference Number) generated when you submitted the application. This number would have been shown on screen and emailed to the registered email ID at the time of filing.
4. The record shows the current stage: under scrutiny at the Regional Authority, query raised (with the specific deficiency listed), approved and authorisation issued, or rejected.
5. If a query has been raised, it appears against the file with a remark from the Regional Authority. You must log back in, respond to the query and re-upload or correct the relevant field; the file does not move forward on its own.
6. Once the authorisation is issued, the same portal login lets you track its subsequent life cycle, including EODC (Export Obligation Discharge Certificate) status after you file for redemption, and any pending bond or bank guarantee requirement against the file.
7. For a status query that the portal itself does not resolve (for example, a delay beyond the normal processing time, or a technical error mid-application), raise an e-ticket through the DGFT helpdesk on the portal, or call the DGFT Toll Free Helpdesk on 1800-111-550, quoting the file number or ARN.
8. Your Export Promotion Council, through which the RCMC was obtained, can also follow up with the concerned Regional Authority on a stuck file, particularly for norms fixation cases pending before the Norms Committee.

There is no SMS-based status alert for Advance Authorisation the way there is for some citizen welfare schemes; the portal login and the helpdesk are the two working channels.

Common reasons for rejection

Advance Authorisation applications are refused or held up for specific, avoidable reasons rather than generic paperwork errors:

• IEC or RCMC not valid or not linked correctly. If the Importer-Exporter Code is inactive, or the RCMC uploaded is expired, is from the wrong Export Promotion Council for the export product, or does not match the applicant's name and IEC, the application is returned. Fix: renew the IEC and RCMC before filing, and confirm the RCMC-issuing body actually covers the product category being exported.
• No SION exists and no ad-hoc norms application was filed. If the export product has no notified Standard Input-Output Norms and the applicant simply declares an input-output ratio without going through the Norms Committee, the file gets stuck or rejected at scrutiny. Fix: check the SION database on the DGFT portal first; if none applies, file the ad-hoc norms request with the Norms Committee alongside, or ahead of, the authorisation application.
• Declared input quantity exceeds what the product genuinely requires. Regional Authorities scrutinise whether the input-to-output ratio is realistic for the stated manufacturing process; an inflated input claim (to import more duty-free material than the export product actually consumes) is a common ground for query or rejection. Fix: base the declared consumption on the actual manufacturing process, supported by a Chartered Engineer or Chartered Accountant certificate where the norms are not self-evident.
• Value addition below the 15% threshold (or the item-specific threshold). If the value of the imported inputs is too high relative to the export product's realisation, the minimum value-addition condition is not met and the application is rejected. Fix: recompute the value-addition calculation before filing, and if it falls short, either revise the input quantities claimed or reconsider whether Advance Authorisation is the right instrument for that product.
• Mismatch between the export product description and the input statement. If the product named in the application does not correspond clearly to the inputs claimed (for example, generic descriptions that do not tie back to a specific SION entry), the Regional Authority raises a query rather than approving outright. Fix: use precise, SION-matching product and input descriptions, not broad category names.
• Digital signature or document upload failures. Applications filed without a valid Class 3 DSC properly registered on the portal, or with illegible or incomplete document uploads, are not processed. Fix: register and test the DSC on the DGFT portal before starting the application, and verify each uploaded document opens correctly before final submission.
• Merchant exporter's supporting manufacturer not properly declared. Where a merchant exporter applies without correctly naming and linking the supporting manufacturer (including that manufacturer's own registration details), the file is queried. Fix: ensure the supporting manufacturer's details are complete and consistent with their own DGFT and GST records before submission.
• Query responses not filed within the stipulated time. A file left unanswered after a Regional Authority query for too long can lapse or be closed as deficient rather than rejected outright, which effectively means starting over. Fix: monitor the portal regularly after filing and respond to queries promptly rather than waiting for a reminder.

None of these are cured by resubmitting the same application unchanged; each requires correcting the underlying IEC/RCMC status, norms basis, value-addition arithmetic, or documentation before the file will move past scrutiny.