Export Policy

Exports are the major focus of India's trade policy and a thrust area is exports involving higher value additions. Most items can be freely exported from India. A few items are subject to export control in order to avoid shortages in the domestic market, to conserve national resources and to protect the environment.

Export profits are exempt from income tax. Higher royalty payments of 8% (net of taxes) are permitted on export sales as compared to 5% on domestic sales. Export commissions up to 10% are also permissible.

Inputs required to be imported for export production are exempted from the basic customs duty. Export Oriented Units (EOUs) and Export Processing Zones (EPZs) enjoy special incentives such as duty free import of capital goods and raw materials for the purpose of export production.

A Brand Equity Fund has been set up to popularize high quality India brands in the world market. The corpus of the fund of Rs 5 billion (US $156 million) will receive equal contributions from the government and industry.