Supplement to Foreign Trade Policy 2004-09 announced on 26.2.2009

  1. Home
  2. Policy
  3. Supplement to Foreign Trade Policy 2004-09 announced on 26.2.2009

February 27, 2009

Members of the Council.
Sub : Supplement to Foreign Trade Policy 2004-09 announced on 26th February, 2009

Dear Member

The Hon’ble Union Minister for Commerce and Industry Shri Kamal Nath announced the Supplement to Foreign Trade Policy 2004-09 on February 26, 2009. The major benefits announced in this supplement are given below


  • An amount of Rs. 325 Crores would be provided under Promotional Schemes for Leather, Textile etc. for exports made with effect from 1.4.09. The details of the promotional schemes are expected to be notified in due course.


  • Duty credit scrips under Chapter 3 and under DEPB scheme shall now be issued without waiting for realization of export proceeds. The exporters shall be required to submit proof of export proceeds realization within the time limits prescribed by Reserve Bank of India. The issuance of these benefits without BRC would be subject to a Bank Guarantee/LUT in terms of Circular to be issued. This provision shall be applicable for applications made on or after 1.4.2009. (members may refer paras 3 to 9 of DGFT Public Notice no. 151 dated 26.2.2009)
  • At present, DEPB/Duty Credit Scrip can be used for payment of duty only on items which are under free category. The utilization is now extended for payment of duty for import of restricted items also. (members may refer paras 7 and 8 of DGFT Notification no. 88 dated 26.2.2009)


  • Export obligation period against advance authorizations has been extended upto 36 months in view of the present global economic slowdown. (members may refer para 21 of DGFT Public Notice No. 151 dated 26.2.2009)
  • Supply of an Intermediate product by the domestic supplier directly from their factory to the Port against Advance Intermediate Authorisation, for export by ultimate exporter, has been allowed. (members may refer paras 16 & 17 of DGFT Public Notice no. 151 dated 26.2.2009)
  • For Advance Licenses issued prior to 1.4.2002, the requirement of MODVAT/CENVAT certificate dispensed with in cases where the Customs Notification itself prescribed for payment of CVD. This will help in closure of a number of pending advance licences. (members may refer para 20 of DGFT Public Notice No. 151 dated 26.2.2009)
  • In case of Advance Authorisation for Annual Requirement where Standard Input-Output Norms are not fixed, the provisions in Customs Notification have been amended in line with Foreign Trade Policy.


  • At present, Govt. recognizes Premier Trading Houses based on an export turnover of Rs.10,000 crores in the previous three years and the current year taken together. In view of the prevailing global slowdown, the threshold limit for recognition as Premier Trading House has now been reduced to Rs.7500 crores (members may refer para 6 of DGFT Notification no. 88 dated 26.2.2009)


  • Re-imbursement of additional duty of excise levied on fuel under the Finance Acts would also be admissible in respect of EOUs. (members may refer para 12 of DGFT Notification no. 88 dated 26.2.2009)
  • Re-credit of 4% SAD, in case of payment of duty by incentive scheme scrips such as VKGUY, FPS and FMS, has now been allowed.
  • As per the existing procedure, applicants have to submit individual invoices certified by the jurisdictional excise authorities for claiming duty drawback claims. Further, for getting refund of Terminal Excise Duty deemed export ER-1 / ER-3 are required as documentary proof evidencing payment of excise duty. A simplified provision has now been introduced and exporters can now submit a Central Excise certified statement in lieu of individual invoices and a Monthly Statement confirming duty payment in lieu of ER-1/ ER-3, for the purpose of Deemed Export Benefits. (members may refer para 12 of DGFT Public Notice No. 151 dated 26.2.2009)
  • Electronic Message Transfer facility for Advance Authorisation and EPCG Scheme established for shipments from EDI ports w.e.f. 1.4.2009. Requirement of hard copy of Shipping Bills dispensed with for Export Obligation discharge.

In addition to the above, DGFT and Department of Revenue provisions have been aligned in following matters:

  1. Utilization of Duty Credit scrip allowed under Reward Schemes of Chapter 3 / DEPB in Chapter 4 of FTP for payment of duty under EPCG Scheme (members may refer para 4 of DGFT Notification no. 88 dated 26.2.2009) .
  2. Notification of DFIA scheme aligned with FTP provisions.
  3. Department of Revenue shall issue necessary clarification implementing provisions of paragraph 6.9(e) of FTP related to EOUs, thereby allowing them to supply goods and services at Zero Duty to authorized organisations notified for Zero Duty import.

A copy of the Supplement hosted in the DGFT website is enclosed herewith for ready reference of members. Also enclosed are DGFT Public Notice No. 151 dated 26.2.2009 and DGFT Notification No. 88 dated 26.2.2009.

Members may please note that the amended Application form ANF 4 G for DEPB has not yet been hosted in DGFT website. Hence, the same will be circulated to members, as soon as the same is hosted.

Members may kindly note the above.

With regards