New rule for importers to get FTA concessions; industry raises concern

Proof of 35% value addition in goods from country of origin must from Monday

Beginning Monday, importers need to furnish proof of 35 per cent value addition in goods from the country of origin to claim duty concession under free trade agreements (FTAs).

Without that, they will not get benefits, said a finance ministry official.

While the move is aimed at plugging duty evasion through routing exports to India under FTAs, industry fears it will result in a compliance burden.

According to the official, just a certificate by the exporter would not suffice. It will be the importer’s responsibility to ensure value addition has been done.

A provision was incorporated into the Customs Act during the budget session