Govt Extends Export Obligation Period To 18 Months For Chemical Industry

In a key relief to the chemical industry, the government has extended the export obligation period under the Advance Authorization Scheme from six months to 18 months for products governed by mandatory quality control orders, according to an official release issued on Tuesday.

For chemical and petrochemical industries, the move provides exporters with greater operational flexibility and reduces compliance-related stress. The extension aligns with similar relief measures previously granted to the textile sector, ensuring consistency across ministries.

Under the Advance Authorization Scheme, exporters are allowed to import raw materials duty-free for the production of export goods. Notably, these imports are exempt from QCO compliance, provided they are used exclusively for export purposes.

This exemption ensures uninterrupted access to critical inputs, which is particularly vital for the chemical sector, where regulatory bottlenecks can severely impact production timelines.

In 2024-25, the chemical and petrochemical sector's export contributions reached $46.4 billion, which is 10.6% of the total export value of the country.

"This initiative aims to ease financial pressures from input costs, guarantee raw material availability, and fortify the competitive position of Indian chemical products worldwide," the official release noted.

The move is poised to simplify trade processes and elevate the global market edge of Indian goods, it further said.