Beginning Monday, Indian customs authorities will strictly scrutinise documents provided by importers claiming duty benefits under free-trade agreements, a move aimed at curbing serious misuse of the concessions under these pacts, finance ministry sources said.
Importers will now have to provide sufficient proof to the domestic customs authorities that the goods being imported have a minimum 35 per cent value addition in the country from which it is being exported to India, they said.
"It will be the responsibility of importers to ensure that the goods being imported by them should have been only manufactured or produced on the foreign countries and minimum 35 per cent value addition have taken place in those countries," the sources said.
For example, if a mobile is exported from, say, Indonesia to India, then it would qualify to be of Indonesian origin only if such mobile is made significantly in Indonesia and 35 per cent of its value is contributed by that country. The move assumes significance in the backdrop of concerns being raised by certain quarters of the domestic industry about misuse of free trade agreement (FTA) benefits from 10-member ASEAN countries.
The importer has to possess all documentary proof to prove that the 35 per cent value addition requirement has been met and showing a mere 'certificate of origin' provided by the exporting country to Indian importer would not suffice.