DGFT scheme allowing duty-free import of inputs required to make export products. Bound by export obligation and value addition norms.
Definition
The Advance Authorisation Scheme is a DGFT scheme that allows an Indian exporter to import inputs required for making export products without paying customs duty, subject to an Export Obligation — the exporter must fulfil exports of the resulting products within a specified period (typically 18 months).
How it works
Exporter identifies the input material and the export product it will be used in
DGFT publishes Standard Input Output Norms (SION) for common product-input combinations
Exporter applies for Advance Authorisation citing SION or a project-specific norm
DGFT issues the authorisation with an Export Obligation (typically 1.5× the CIF value of duty-free inputs, or a minimum value addition of 15%)
Export Obligation must be fulfilled within the deadline (typically 18 months)
eBRC evidence required for every export counted against EO
Non-fulfilment attracts full customs duty (retroactively) + interest + penalty
For Indian FBA exporters
If you import raw materials or components for your FBA products (private-label manufacturing, packaging materials, specialised inputs), Advance Authorisation can materially cut your input cost. But the compliance overhead is real — EODC tracking, SION documentation, deadline management. Weigh the benefit against the additional paperwork.
For pure resellers or Indian-manufactured-only sellers, Advance Authorisation is typically not relevant.