New Delhi, 01 April (H.S.):
The central government has announced a one‑time special relief measure for Special Economic Zones (SEZs), extending concessional customs duty benefits to eligible units exporting manufactured goods to the Domestic Tariff Area (DTA).
The scheme, effective from 1 April 2026 to 31 March 2027, is aimed at supporting SEZ‑based manufacturers amid global trade uncertainties and subdued external demand.
The Central Board of Indirect Taxes and Customs (CBIC) has framed the measure as a customs duty exemption notification issued under Section 25 of the Customs Act, 1962, operationalising a proposal made in the Union Budget 2026‑27. The notification allows eligible SEZ‑based units to supply certain manufactured goods to the DTA at concessional customs duty rates, rather than paying the full standard‑rate levy.
Finance Ministry sources said the benefit will apply to finished goods supplied from SEZ units to the DTA, and will remain in force for the 12‑month period ending 31 March 2027. To qualify, a unit must have commenced production on or before 31 March 2025, ensuring that only existing, operational SEZ manufacturers can access the relief.
The government has stressed that the scheme has been designed to protect the interests of domestic industry. Equal‑opportunity conditions have been applied so that DTA‑based producers are not competitively disadvantaged against SEZ firms availing concessional duty.
Accordingly, certain sensitive sectors and product‑categories have been kept outside the scope of the relief to avoid adverse impact on local manufacturing.
For each eligible SEZ unit, the volume of DTA sales allowed under concessional‑duty treatment is capped at 30 per cent of the highest export performance recorded in any of the previous three financial years. This link between exports and concessional‑domestic‑sales volume is meant to ensure that the benefit is tied to a unit’s proven export track‑record rather than creating an open‑ended loophole.
Rationale in the 2026‑27 Budget
Union Finance Minister Nirmala Sitharaman had, in her Budget 2026‑27 speech, proposed this one‑time special measure to address concerns that SEZ‑based manufacturing units were operating below capacity due to disruptions in global trade and softer overseas demand. The provision allows them, for a limited period, to divert some production to the domestic market at concessional duty, while keeping the overall export‑link conditions intact.
By capping the DTA‑sale volume as a fraction of past exports, the government aims to strike a balance between providing short‑term support to SEZ manufacturers and preventing any long‑term distortion in the SEZ–DTA duty‑structure or undermining domestic producers.
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Hindusthan Samachar / Jun Sarkar
