DEEMED EXPORT BENEFIT

[MAHESH AGARWAL]

Deemed Export benefits are covered by Chapter 7 of FTD. Clause 7.02.(e) : B - Categories of Supply by Main/Sub contractor(s) allows benefit of deemed export like Advance Authorization/ DFIA, Duty drawback or Refund/Exemption of Terminal Excise Duty. Projects financed by multilateral/Funds notified by DEA, MoF are allowed for Deemed Export benefit. However the condition posed in para 7.02.E.(iii) is that the supplies covered shall be under International Competitive Bidding (ICB) in accordance with the procedures of those Agencies/ Funds.

The query here is that a Infrastructure Project of road which is financed by Asian Development Bank (ADB) (an approved agencies under Appendix 7A of the FTP )has been evaluated under National Competitive Bidding (NCB) process instead of (ICB) as mentioned above, by Publilc Works, Ports & Inland water Transport Department, Govt of Karnataka , India , known as ( Karnataka State Highways Improvement Project (KSHIP)), will be eligible for benefits of Deemed Export as prescribed under para 7.04 of the Foreign Trade Policy.

AI Summary

Deemed Export Benefits Approved for ADB-Funded Infrastructure Project Despite Not Using International Competitive Bidding A query was raised regarding the eligibility for deemed export benefits for an infrastructure project financed by the Asian Development Bank (ADB) under the Karnataka State Highways Improvement Project (KSHIP). The project was evaluated using National Competitive Bidding (NCB) instead of the required International Competitive Bidding (ICB) as per the Foreign Trade Policy. The discussion concluded that the project is eligible for deemed export benefits since it is funded by an approved agency, ADB, despite the deviation from ICB procedures.