The Free trade agreements ( FTA ) to customs authorities, failing which duty benefits available fall under the agreements will be denied , government sources. If importers are not able to satisfy the customs that good have been manufactured with a least 35 percent value addition, FTA benefits would be denied, a senior official said.
FTA – A free trade area ( FTA ) is where there is no import tariffs or quotes on products from one country entering another. Read more in brief at here.
It will be the responsibility of importers to ensure that imported goods by them should have been only manufactured or produced on the foreign countries but it also minimum 35% value addition have take place in those countries.
This means that google originating from China and routed through these countries will not eligible for custom duty concessions under ASEAN, FTA, the official said.
If a mobile is exported from Indonesia to India, then it would qualify of being Indonesian origin only if such mobile is made significantly in Indonesia and 35% of its FOB value is contributed by Indonesia, the official explained.
The investigation into FTA imports in last few years has revealed that rules of origin under respective FTA, where not being followed in the true spirit. In a number of cases, it was discovered that items from non-ASIAN countries were being diverted into India through ASEAN countries with were packing / repacking , assembly or minor processes and declaring 35% value addition or wrongly claiming significant transformation in ASEAN member country.
Source : This whole story were published on economic times. We just share on our website for our read to have a look into FTA Rules in India.