India extends export obligation for chemical imports to 18 months: Govt

The government on Tuesday said extension of the export obligation period for chemical imports under the advance authorisation scheme from six to 18 months will provide much-needed relief to exporters amid concerns over steep US tariffs.

"This measure extends essential support and flexibility to exporters dealing with chemicals and petrochemicals across India," the Ministry of Chemicals and Fertilisers said in a statement.

The move is poised to simplify trade processes and elevate the global market edge of Indian goods.

"The Export Obligation timeframe has now been extended from 6 months to 18 months, offering a substantial buffer to the industry," the statement added.

 

Through the Advance Authorization Scheme, importers can bring in duty-free raw materials for export production without adhering to quality control orders (QCOs) for those inputs, ensuring a steady flow of export operations.

A significant number of these authorizations cater to the chemical sector, emphasizing the value of this policy shift.

The government remains committed to strengthening the chemicals and petrochemicals landscape through targeted strategies, acknowledging its pivotal role in economic growth.

In 2024-25, the sector's export contributions reached USD 46.4 billion, which is 10.6 per cent of the total export value of the country, reinforcing its critical status.

This initiative aims to ease financial pressures from input costs, guarantee raw material availability, and fortify the competitive position of Indian chemical products worldwide.

The Department of Chemicals and Petrochemicals and DGFT's actions demonstrate a forward-thinking and strategic vision.

The move assumes significance as the US has imposed steep 50 per cent tariffs on Indian goods entering the US market.

According to exporters, the chemicals sector is also expected to get impacted from these high duties.