DEEMED EXPORT

P81070 Paresh Patil

P81130 Ameya Deshpan

Deemed Export Definition

When the goods do not physically cross the border
of the exporting country, nevertheless the
government considers this as export for some perks
or other benefits, it is called deemed export.
Meaning not export practically but considered as
one.

Deemed Export
Concept
Unique to India
Specified transactions where goods are not
physically exported outside the country
Payment for such supplies is received either
in Indian rupees or
in free foreign currency
Objective
Encourage exports directly / indirectly

Criteria for Deemed Export

Entitlement
Following categories of supplies by main contractors / subcontractors treated as deemed exports
Against Advance Authorization / Advance Authorization
for annual requirement / DFIA
Supply To EOU / STP / EHTP / BTP
Capital goods to EPCG Authorization holders
Projects financed by multilateral or bilateral agencies /
funds as notified by the Department of Economic Affairs,
Ministry of Finance under International Competitive
Bidding (ICB)(Appendix 13)
Supply of goods where legal agreements provide for
tender evaluation without inclusion of Customs duty
Supply and installation of goods and equipment where
bids are evaluated on the basis of Delivered Duty Paid
(DDP) prices for goods manufactured abroad

Criteria for Deemed Export

Capital goods (CG) to fertilizer plants
including CG in unassembled / disassembled condition
plants, machinery, accessories, tools, dies and such goods which
are used for installation purposes till stage of commercial
production, and
spares to the extent of 10% of Bidding value.
To any project or purpose in respect of which the MoF, by
notification, permits import of such goods at zero Customs duty
To power projects (UMPP) and refineries not covered above (Subject
to ICB)
an inter state Thermal Power Plant of capacity of 1000MW or more; or
an inter state Hydel Power Plant of capacity of 500 MW or more.

Supply of marine freight containers by 100% EOU

Containers to be exported out of India within 6 months or such
further period as permitted by Customs
To projects funded by UN Agencies. (Eg. World Bank)
To nuclear power projects through competitive bidding.

Benefits to deemed exports

Deemed Exporters shall be entitled to
Advance Authorization / DFIA.
Deemed export Drawback.
Refund of Terminal Excise duty.

 Deemed export benefits available for

supply of goods, not service deals

Example any supply to a factory in SEZ is

deemed Export.

 Special Economic Zone (SEZ) units

and Export Oriented Units (EOU)
Supplies to EOU are deemed exports
and here again, you can claim deemed
exports duty drawback as per the
provisions in Chapter 8 of the Foreign
Trade Policy (FTP). You also have the
option to obtain advance authorisation
or duty free import authorisation (DFIA)
and import the sawn wood duty free,

Thank You