DGFT Eases QCO Norms for Textile Imports Under Advance Authorisation

“Indirect Tax I Indirect Tax Litigation I Customs & FTP I Central Licensing I Arbitration I Advisory”

Dated: 24.06.2025

DGFT Eases QCO Norms for Textile Imports Under Advance Authorisation

In a significant move to streamline input imports under India’s Quality Control Order (QCO) regime, the Directorate General of Foreign Trade (DGFT) has issued Notification No. 20/2025-26 dated 23rd June 2025. This notification amends Para 2.03(A)(i)(g) of the Foreign Trade Policy (FTP) 2023, and directly impacts Advance Authorisation holders, EOUs (Export Oriented Units), and SEZ (Special Economic Zone) units importing regulated inputs.

Background: QCO Challenges for Importers

Over the past year, the imposition of mandatory Quality Control Orders (QCOs) on a wide array of textile and chemical products has posed compliance burdens on exporters relying on Advance Authorisation or operating in EOUs and SEZs. Previously, to qualify for QCO exemption, exporters were required to fulfil their Export Obligation (EO) within 180 days, especially for products notified by the Ministry of Textiles and the Department of Chemicals & Petrochemicals (DCPC). This time-bound condition created operational constraints for many manufacturers.

Key Amendment in Notification No. 20/2025-26

The new notification revises Para 2.03(A)(i)(g) of FTP 2023 to exclude the Ministry of Textiles from the 180-day EO condition. Now, the 180-day EO restriction applies only to chemical products notified under QCO by DCPC. Imports of textile items under Advance Authorisation will no longer face the stricter 180-day timeline and will follow the standard EO period under Para 4.40 of the Handbook of Procedures.

Old Text vs. New Text:

Provision	Earlier	Amended
EO Period	180 days for both textile and chemical products under QCO	180 days only for chemical products under QCO
Applicable Authority	Ministry of Textiles and DCPC	DCPC only

Implication for Exporters

Textile exporters holding Advance Authorisation will benefit the most, as they can now plan their input imports and exports over a longer, more flexible period.
This change reflects the government’s recognition of the practical difficulties faced by MSMEs and exporters due to rigid QCO timelines.
Chemical product importers, however, must still adhere to the 180-day EO restriction to avail QCO exemption under Advance Authorisation.

Legal Basis of Amendment

The amendment has been made under the powers vested in the Central Government by:

Section 3 and 5 of the Foreign Trade (Development & Regulation) Act, 1992
Para 1.02 and 2.03 of the Foreign Trade Policy 2023

Conclusion

This DGFT Notification is a welcome relief, particularly for the textile industry, and is aligned with the government’s broader aim to ease trade and enhance export competitiveness. Stakeholders in the chemical sector, however, must continue adhering to the specific QCO compliance requirements and track their EO timelines carefully.

Listen to this on our #YouTube Channel

In case you face any issues related to Indirect Tax-Customs, GST, Foreign Trade Policy (FTP), Arbitration matters and Central Licensing and related advisory matters in India then please feel free to get in touch with SJ EXIM Services.

We offer Legal advice and litigation support in matters related to Indirect Tax-Customs, FTP, other Indirect Tax matters & Arbitration law, all sorts of Central licensing and related matters. Come and explore the new way of doing business with us!

Source: DGFT

Disclaimer

Handy Download:

DGFT Notification Download

Connect with us for more-

@ Team S J EXIM SERVICES, New Delhi, IN

CP: Ms. Shubhra Jha, Founder

Tel: +91-11-4999 2707 I +91-9999005693

Web: www.sjexim.services

EMAIL: operations@sjexim.services I shubhra@sjexim.services

Facebook: www.facebook.com/sjeximservices

LinkedIn: https://www.linkedin.com/company/90794255/admin/feed/posts/