GTRI Uncovers Widespread Abuse in Duty-Free Import Scheme

Think tank GTRI has raised alarming concerns over the misuse of the Duty Free Import-authorisation (DFIA) scheme, highlighting how certain goods like walnuts, saffron, and lithium ion batteries are being imported duty-free under false pretenses.

Exploitation of Legal Loopholes: The scheme, intended to support exporters, is allegedly being exploited by traders to avoid high levies on specific goods. Licenses are traded, and goods are never used in production as claimed, turning the scheme into a 'legalised smuggling channel.'

Government Responds to Allegations

The commerce department has stated that there are safeguards in place to prevent misuse, emphasizing that only basic customs duty is exempted under the DFIA scheme. A permanent mechanism within DGFT monitors complaints and reviews standard input output norms (SION) to prevent unintended benefits.