Deemed Export Benefit Scheme
Deemed Export Benefit Scheme is an Indian concept which refers to the transactions in which the supplied goods do not leave the country i.e. these products aren’t expected. The payments for these products are made in Indian currency or in foreign exchange only. The benefits of this scheme are that the rebate on chargeable duty on imports and material on which excise is applied is used to manufacture goods which are supplied for the eligible projects. These products are manufactured and used in India itself.
The Deemed Export Benefit is available to projects in Petroleum refinery, fertiliser, Nuclear Power Plant Projects, Power etc. It is also made available for ventures which are funded by bilateral or multilateral sources.
The aim of the Policy
- Create a level playing ground and promote domestic industry
- Provide duty-free import and duty refund for products manufactured in India.
- It aims to reduce the dependency on imports.
- It aims at developing the skill of Indians and generates employment.
Conditions to be called a Deemed Export
- Goods which are manufactured in India or by an Indian Subcontractor for a foreign main contractor at the decided project site are eligible for deemed export benefit.
- Payment should be made directly to the Indian sub-contractor which manufactured the good.
- No third-party supply will be eligible for benefits and all the supply should be made directly to the entities.
- If a subcontractor delivers the supplied to the main contractor then the payment will be made to the main contractor who will in turn pay the subcontractor.
- All the supplies should be made directly to the designated project site.