In big relief for chemical exporters, govt extends export obligation period to 18 months

The government has extended the export obligation period under the Advance Authorisation Scheme for chemical products notified under mandatory Quality Control Orders (QCOs) from the existing six months to 18 months.

The Directorate General of Foreign Trade (DGFT), acting on the recommendations of the Department of Chemicals and Petrochemicals (DCPC), notified the change through a circular dated August 28, 2025.

"The Export Obligation Period against the import of the products that are subjected to mandatory QCOs by the Department of Chemicals & Petrochemicals (DCPC), under Advance Authorisation has been extended from existing 06 months to 18 months," the DGFT notification read.

The measure follows a similar adjustment for other industries, such as textiles, where the export obligation period for QCO products had earlier been extended to 18 months.

Under the Advance Authorisation Scheme, importers are allowed a duty-free import of raw materials required for manufacturing export products.

The exemption applies even when the inputs are not compliant with Indian QCOs, ensuring uninterrupted supply chains for exporters.

“This measure extends essential support and flexibility to exporters dealing with chemicals and petrochemicals across India. The move is poised to simplify trade processes and elevate the global market edge of Indian goods,” an official statement read.

The chemical and petrochemical sector is a major contributor to India’s outward shipments.

In 2024-25, the industry accounted for exports worth USD 46.4 billion, representing 10.6% of the country’s total exports, according to official data.

“This initiative aims to ease financial pressures from input costs, guarantee raw material availability, and fortify the competitive position of Indian chemical products worldwide,” DCPC said in a statement.

“The Department of Chemicals and Petrochemicals and DGFT’s actions demonstrate a forward-thinking and strategic vision,” it added.