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Export Incentives

MEIS

Merchandise Exports from India


Scheme (MEIS) under Foreign Trade
Policy of India (FTP 2015-20) is one
of the two schemes introduced in
Foreign Trade Policy of India 2015-20,
as a part of Exports from India
Scheme. (The other scheme is SEIS,
Service Exports from India Scheme)

Nature of Rewards Under MEIS

Duty Credit Scrips shall be granted as rewards under


MEIS. The Duty Credit Scrips and goods imported /
domestically procured against them shall be freely
transferable. The Duty Credit Scrips can be used for
the following requirements:
(i) Payment of Customs Duties for import of inputs or
goods
(ii) Payment of excise duties on domestic procurement
of inputs or goods, including capital goods as per DoR
notification.
(iii) Payment of service tax on procurement of
services as per DoR notification.
(iv) Payment of Customs Duty and fee.

What is duty credit scrip?

The duty credit scrip is a pass that allows


the holder to import commodities by not paying a specified
amount in import duties. Following are the main features of
duty credit scrip:
They are issued to exporters
The scrip allows duty deduction (non-payment of taxes) of a
specified amount in the scrip. The scrip value or the amount
of tax deduction will be specified in the scrip.
The scrip value or tax reduction is expressed as a
percentage of export turnover of the exporter.
The scrip value usually varies between 3 per cent to 5 per
cent under Foreign Trade Policy 2015.
Basically, duty free scrips are paper
authorizations. Main objective of the scrip is to incentivize
the exporters to make more exports of specific
commodities/services and those to specific markets.

Aim

Objective of Merchandise Exports from


India Scheme (MEIS) as per Indian Foreign
Trade
Policy
2015-20
is
to
offset
infrastructural inefficiencies and associated
costs involved in export of goods/products,
which are produced/manufactured in India,
especially those having high export
intensity,
employment
potential
and
thereby
enhancing
Indias
export
competitiveness.

Entitlement under MEIS

Exports of notified goods/products with


ITC[HS] code, to notified markets as listed
in Appendix 3B, shall be rewarded under
MEIS. Appendix 3B also lists the rate(s) of
rewards on various notified products [ITC
(HS) code wise]. The basis of calculation of
reward would be on realized FOB value of
exports in free foreign exchange, or on FOB
value of exports as given in the Shipping
Bills in free foreign exchange, whichever is
less, unless otherwise specified.

Export of goods through courier


or foreign post offices using eCommerce
(i) Exports of goods through courier or foreign post office using ecommerce, as notified in Appendix 3C, of FOB value up to Rs.
25000 per consignment shall be entitled for rewards under MEIS.
(ii) If the value of exports using e-commerce platform is more than Rs
25000 per consignment then MEIS reward would be limited to FOB
value of Rs.25000 only.
(iii) Such goods can be exported in manual mode through Foreign Post
Offices at New Delhi, Mumbai and Chennai.
(iv) Export of such goods under Courier Regulations shall be allowed
manually on pilot basis through Airports at Delhi, Mumbai and
Chennai as per appropriate amendments in regulations to be made
by Department of Revenue. Department of Revenue shall fast
track the implementation of EDI mode at courier terminals.

Ineligible categories under MEIS as


per Import Export Policy 2015-2020
(FTP 2015-20)

1.
2.
3.
4.
5.
6.
7.
8.
9.
10.

The following exports categories /sectors shall be ineligible for Duty


Credit Scrip entitlement under MEIS, EXIM Policy 2015-20 (FTP
2015-20).
EOUs / EHTPs / BTPs/ STPs who are availing direct tax benefits /
exemption.
Supplies made from DTA units to SEZ units
Exports through trans-shipment, meaning thereby exports that are
originating in third country but trans-shipped through India;
Deemed Exports;
SEZ/EOU/EHTP/BTP/FTWZ products exported through DTA units;
Items, which are restricted or prohibited for export under Schedule2 of Export Policy in ITC (HS)
Service Export.
Red sanders and beach sand.
Export products which are subject to Minimum export price or export
duty.
Diamond Gold, Silver, Platinum, other precious metal in any form
including plain and studded jewellery and other precious and semiprecious stones.

EPCG

Under EPCG scheme, the capital goods imported are


subject to actual user condition and the goods
imported cannot be transferred or sold till the
fulfillment of export obligation.
Present Foreign Trade Policy allows EPCG
authorization holder to extend block-wise period for
any block or overall period of fulfillment of export
obligation up to a period of two years on payment of
composition fee equal to 2% of proportionate duty
saved amount on unfulfilled export obligation for each
year of extension.
At present, the EPCG holder under zero duty scheme
can avail only one extension of two years in export
obligation period shall be available subject to
conditions mentioned.

1ZerodutyEPCGscheme
Under this scheme import of capital
goods at zero custom duty is allowed
for producing quality goods and
services to enhance Indias export
competitiveness.

PostExportEPCGDutyCreditScrip
Scheme
A Post Export EPCG Duty Credit Scrip
Scheme shall be available for
exporters who intend to import
capital goods on full payment of
applicable duty in cash.

TownsofExportExcellence(TEE)
Selected towns producing goods of
Rs. 750 crores or more are notified as
TEE on potential for growth in exports
and provide financial assistance under
MAI Scheme to recognized
Associations.

MarketAccessInitiative(MAI)
Scheme
Under
the
Scheme,
financial
assistance is provided for export
promotion activities on focus country,
focus product basis to EPCs, Industry
& Trade Associations, etc.

Range of activities can be funded by


MAI scheme. These include: market
studies,
setting
up
of
showrooms/warehouses,
sales
promotion & publicity campaigns,
participation in international trade fairs
,
publicity
campaigns,
brand
promotion,
reimbursement
of
registration
charges
for
pharmaceuticals, testing charges for
engineering products abroad, etc.
Financial assistance ranging from 25%
to 100% of total costs can be received

StatusHolderScheme
Upon achieving prescribed export
performance, status recognition as one
star Export House, two Star Export
House, three star export house, four
star export house and five star export
house is accorded to the eligible
applicants as per their export
performance.
Such Status Holders are eligible for
various non-fiscal privileges as
prescribed in the Foreign Trade Policy.