Relief to Chemical Exporters: Government Extends Export Obligation to 18 Months Under Advance Authorisation

In a move welcomed across the chemical sector, the Government of India has extended the export obligation period for Quality Control Order (QCO) products under the Advance Authorisation Scheme from 6 months to 18 months. The decision offers significant flexibility to exporters, paving the way for improved operations and higher global competitiveness.

Export Timeline Extended: Boost for Chemical Sector

As per Notification No. 28 dated May 28, 2025, released by the Directorate General of Foreign Trade (DGFT), the export obligation period for products under mandatory QCOs issued by the Department of Chemicals and Petrochemicals (DCPC) has been extended from 6 months to 18 months. 

This aligns with similar relief given in other sectors like textiles. The chemical industry, one of the largest beneficiaries of Advance Authorisations, will greatly benefit from this increased timeframe.

Ease of Trade and Raw Material Access

The Advance Authorisation Scheme allows exporters to import raw materials duty-free for export production. These imports are exempt from QCO compliance, ensuring smoother operations. This alleviates pressure due to input costs and delays, easing operational burdens and ensuring uninterrupted manufacturing cycles for export orders.

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Sustained Focus on Sectoral Growth

For 2024-25, India’s chemical and petrochemical exports stood at $46.4 billion, contributing 10.6% to the nation’s total exports. The recent policy change reaffirms the government’s intent to enhance the sector’s stature in international markets. By extending the export commitment period, exporters get increased time to fulfil global orders without regulatory haste, effectively enhancing supply chain efficiency.

Strengthened Global Competitiveness

This initiative not only cushions exporters against supply disruptions and input constraints but also ensures consistent raw material availability. With reduced regulatory stress and extended timelines, Indian chemical manufacturers are poised to become more agile and globally competitive in fulfilling large-volume, high-value contracts.

Conclusion

The government’s decision to extend the export obligation from 6 months to 18 months for QCO products under Advance Authorisation has been applauded across the chemical sector. It signals firm support for exporters, boosts competitiveness, and ensures smoother trade operations, setting a progressive tone for continued growth in this vital industry.

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