How does Advance Authorisation work?

What is Advance Authorisation?

Advance Authorisation (AA) is a DGFT scheme that lets exporters import inputs duty-free (raw materials, components, consumables, fuel, oil, catalysts, and packaging materials) provided they are used to manufacture export products.

At a glance

Governed by

Foreign Trade Policy 2023, Chapter 4, Para 4.03. 4.13

Who can apply

Manufacturer-exporters or merchant-exporters tied to supporting manufacturers

What's covered

Inputs (raw materials, components, consumables, fuel, packing materials)

Minimum value addition

15% (export value must exceed import value by at least 15%)

EO period

18 months, extendable by 6 + 6 months and no more (HBP 4.40)

Transferable?

No. Inputs must be used by the licence holder or supporting manufacturer

Which duties are exempted under AA?

• Basic Customs Duty (BCD)
• Additional Customs Duty (CVD equivalent)
• Education Cess and Secondary & Higher Education Cess
• Anti-dumping Duty
• Safeguard Duty
• IGST (exempt since Oct 2017. Notification 18/2015-Customs as amended)
• Compensation Cess

Savings example. Garment exporter

Imported fabric CIF value

00,000

BCD rate on fabric

20%

IGST rate

12%

Normal duty payable

$32,000+ (BCD + IGST on assessable value)

Under AA

$0. All duties exempted

What are SION norms?

SION (Standard Input-Output Norms) define how much input you can import duty-free per unit of export product. DGFT publishes SION for hundreds of product categories.

SION example. Cotton T-shirt (SION E-51)

What if there is no SION for my product?

Apply for an ad-hoc norm. DGFT's Norms Committee will fix input-output norms based on your manufacturing process. Steps:

1. Apply for AA with "ad-hoc norms" on the DGFT portal
2. Submit self-declaration of input requirements with manufacturing process details
3. DGFT may grant provisional AA based on self-declaration
4. Norms Committee fixes final norms (may take 3. 6 months)
5. If final norms are tighter, return excess imported inputs or pay duty

How do I apply for Advance Authorisation?

Application steps. DGFT portal

1. Login to DGFT portal (dgft.gov.in) with your IEC and DSC
2. Select Services → Advance Authorisation → New Application
3. Enter export product details. HS code, description, quantity, FOB value
4. Enter input details. HS code, description, quantity (as per SION or proposed ad-hoc norm), CIF value
5. Upload documents. Export order/LC copy, RCMC, self-declaration, CA certificate for value addition
6. Pay application fee. Rs 1,000 per authorisation (online)
7. Submit. Processed by Regional Authority (RA) of DGFT
8. Receive authorisation. Typically 3. 5 working days for SION-based; 2. 4 weeks for ad-hoc

Documents required

• Valid IEC
• RCMC from relevant Export Promotion Council
• Export order or LC copy
• Self-declaration of input requirements
• CA/CS certificate for past export performance (if applicable)
• Manufacturing process details (for ad-hoc norms)
• Previous AA redemption certificates (if any outstanding)

What is the export obligation?

Export obligation parameters

EO value

CIF value of imports + 15% value addition (minimum)

EO period

18 months from date of issue of authorisation

Extension

Two extensions of 6 months each, never beyond 12 months from EO expiry (HBP 4.40(e). (f)). Composition fee applies

Fulfillment

Physical exports against the specific authorisation

Penalty for non-fulfillment

Pay customs duty saved + interest (15% p.a.) on unfulfilled portion

How do I redeem the authorisation after export?

Redemption process (EODC)

1. Complete all exports against the authorisation within the EO period
2. Obtain eBRC (electronic Bank Realisation Certificate) for export proceeds from DGFT
3. Apply for EODC (Export Obligation Discharge Certificate) on DGFT portal
4. Submit: shipping bills, eBRCs, import Bills of Entry, consumption register, CA certificate
5. DGFT RA verifies and issues EODC
6. Bond/BG executed with customs is released after EODC

Sources

Foreign Trade Policy 2023, Chapter 4. Duty Exemption and Remission Schemes (Para 4.03. 4.13). Handbook of Procedures, Chapter 4. DGFT SION (Standard Input Output Norms) database. Customs Notification 18/2015-Customs (as amended) for IGST exemption on AA imports.

Update history

• 2026-08-10 First published.