Around 600 Japanese and more than 100 Southeast Asian companies have reached out to the Indian government and customs authorities, raising concerns over the challenges they are facing at Indian ports. The delays stem from India’s new rules which require companies to prove the origins of products to claim the benefits under various Free Trade Agreements. The new rules are based on a domestic industry’s request to curb the misuse of customs duty concessions under FTAs.
Under the new rules, importers must ensure that imported goods are manufactured or produced in foreign countries when they receive at least 35% value addition. Importers are obliged to provide all necessary documents to the Customs Department. Otherwise, the FTA benefits would be denied. However, the new rules lead to massive import delays. Companies that have raised complaints about the new regulations include Samsung, Toyota, Hyundai, Honda, Ford etc.
