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Dated: 28.07.2026
India’s Export Policy Overhauled: Harmonisation of ITC (HS) 2022 Schedule-II with Finance Act 2026
The Government of India has issued Notification No. 26/2026-27, dated 27 July 2026, introducing significant amendments to Schedule-II (Export Policy) of the ITC (HS) 2022. These changes align the export policy with the latest amendments introduced by the Finance Act, 2026. Below is a comprehensive overview of the key updates, their implications, and what exporters need to know.
Background and Objective
The amendments are enacted under the Foreign Trade (Development & Regulation) Act, 1992, and the Foreign Trade Policy 2023. The primary objective is to harmonise the export policy with the Finance Act, 2026, ensuring consistency in tariff items, policy conditions, and export regulations.
Key Highlights of the Notification
1. Structural Changes
- Section Notes, Chapter-wise Main Notes, Sub-Heading Notes, and Supplementary Notes have been updated to reflect the Finance Act, 2026.
- Annexure-I details the modifications in the notes and supplementary notes for various chapters.
- Annexure-II lists the ITC (HS) codes that have been introduced, deleted, amended, split, or merged.
2. Major Chapter-wise Amendments
Chapter 3: Fish and Crustaceans
- Tariff item 03061900 (Frozen Free: Other Jasus sp.) deleted.
- New entries for Krill (03061910) and Other (03061990) marked as ‘Free’ for export.
Chapter 8: Edible Fruits and Nuts
- Introduction of specific codes for pecan nuts, cranberries, and blueberries.
- Several old codes deleted and replaced with more granular classifications.
- Export duty rates updated for certain nuts (e.g., Rs. 35/kg for 0802 11 00, Rs. 100/kg for 0802 12 00, 100% for 0802 31 00).
Chapter 12: Oil Seeds and Oleaginous Fruits
- Addition of Shea nuts (12079950) as a new exportable item.
- Export duty for various seeds set at 15%.
Chapter 13: Lac, Gums, Resins, and Extracts
- Detailed classification for plant extracts, including Withania somnifera, Bacopa monnieri, and others.
- Cashew shell liquid (CNSL) and its derivatives now have specific codes.
Chapter 20: Preparations of Vegetables, Fruits, Nuts
- New codes for cranberries and blueberries in processed forms.
- Export duty for certain items set at 30%.
Chapter 21: Miscellaneous Edible Preparations
- Compound alcoholic preparations for beverages now have distinct codes.
- Export duty for several preparations set at 50%.
Chapter 22: Beverages
- New codes for cranberry products in fruit pulp, juice-based drinks, and milk beverages.
Chapter 25: Salt, Sulphur, Earths, and Stone
- Fluorspar codes updated; acid grade and other categories now ‘Free’ for export.
- Export duty for certain minerals set at 2.5% or marked as ‘Free’.
Chapter 28 & 29: Chemicals
- Numerous chemicals have been reclassified, with several codes deleted and new ones introduced.
- Export of certain chemicals (e.g., phenylacetic acid, anthranilic acid, ephedrine, pseudoephedrine, lysergic acid) is ‘Free’ but subject to a No Objection Certificate from the Narcotics Commissioner of India, Gwalior.
Chapter 39: Plastics
- Biodegradable plastics now have a dedicated code (39232991) and are ‘Free’ for export.
- Export duty for heading 3904 set at 7.5%.
Chapter 41: Raw Hides and Skins
- Wet blue leathers now have specific codes and are ‘Free’ for export.
Chapter 47 & 48: Pulp and Paper
- Chemical wood pulp (dissolving grades) now prohibited for export.
- Kites (48239040) added as a new exportable item.
Chapter 73: Iron and Steel Pipes
- Extensive reclassification of non-galvanised and galvanised pipes, with new codes for various types and coatings.
Chapter 81, 84, 85, 86: Metals, Machinery, and Containers
- New codes for bars, rods, and containers, with most items marked as ‘Free’ for export.
3. Policy Conditions and Compliance
- Many items, especially chemicals and plant extracts, are ‘Free’ for export but subject to specific policy conditions, such as obtaining a No Objection Certificate from relevant authorities.
- Exporters must refer to the updated ITC (HS) codes and policy conditions available on the DGFT website (https://dgft.gov.in).
Implications for Exporters
- Immediate Effect: All amendments come into force immediately.
- Updated Codes: Exporters must use the new ITC (HS) codes for customs and export documentation.
- Compliance: Ensure compliance with new policy conditions, especially for sensitive items.
- Tariff Changes: Be aware of revised export duties and policy conditions for specific products.
How to Access the Updated ITC (HS) Codes
The Directorate General of Foreign Trade (DGFT) has made the updated ITC (HS) codes available on its official website. Exporters are advised to consult the latest version to avoid discrepancies in export documentation.
Conclusion
The harmonisation of Schedule-II (Export Policy) of ITC (HS) 2022 with the Finance Act, 2026, represents a significant step towards streamlining India’s export regulations. Exporters should review the detailed amendments, update their internal systems, and ensure full compliance to benefit from the new policy framework.
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Source: DGFT
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