India Extends Export Obligation to 18 Months, Easing Pressure on Chemical Exporters

The Government of India has announced a major relief for chemical exporters by extending the export obligation period for Quality Control Order (QCO) products under the Advance Authorisation Scheme from six months to 18 months. The notification, issued by the Directorate General of Foreign Trade (DGFT) as Notification No. 28 on May 28, 2025, provides exporters with greater flexibility and helps improve operational efficiency.

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Export Obligation Extended: A Boost for Chemical Exporters

The Advance Authorisation Scheme allows duty-free import of raw materials for goods meant for export. These imports are not bound by QCO compliance, which reduces delays and operational hurdles. The longer export window gives exporters extra time to fulfil global orders, ensuring smoother production cycles and more efficient supply chain management.

In 2024–25, India's exports of chemicals and petrochemicals totalled $46.4 billion, accounting for more than 10% of all exports from the country.  Like the relief measures offered in the textile and other industries, the extension is anticipated to increase the sector's visibility in global markets.

Easing Trade and Operational Challenges

Industry experts have welcomed the change, noting that longer export obligations will help companies deal with raw material shortages, rising input costs, and production delays. This extra time allows exporters to manage contracts better, improve delivery schedules, and maintain competitiveness globally.

The policy also supports the government’s goal of making India’s chemical sector more reliable for international buyers. By reducing regulatory pressure and providing consistent access to raw materials, exporters can respond more effectively to market demands and global supply challenges.

Conclusion,

The extension of the export obligation from six to 18 months under the Advance Authorisation Scheme is a significant boost for chemical exporters. It reduces operational stress, strengthens India’s competitiveness, and positions the sector for steady growth in international trade.