DGFT Invites Comments on Non-Preferential Rules of Origin
The Directorate General of Foreign Trade (DGFT) has proposed an amendment to Para 2.93 of the Handbook of Procedures (HBP), 2023, relating to Rules of Origin (Non-Preferential).
The proposed amendment aims to comprehensively prescribe Non-Preferential Rules of Origin for both exports and imports, with clearer criteria for determining the origin of goods. DGFT has invited exporters, importers, Export Promotion Councils, trade bodies and other stakeholders to submit their comments and suggestions on the draft.
Proposed Rules of Origin for Exports
Manufacturing Requirement
Under the proposed provisions, goods exported from India must be manufactured by the exporting entity in accordance with the definition of “Manufacture” under Paragraph 11.31 of the Foreign Trade Policy (FTP).
Where imported inputs are used in manufacturing an export product, the product can qualify as originating in India for Non-Preferential purposes only when the processing or operations go beyond specified simple operations.
Operations That Do Not Qualify on Their Own
The draft specifies several operations that are considered insufficient for establishing Indian origin, including:
- Removal of dust, sifting, screening and sorting
- Washing, painting and cutting
- Changes of packing and breaking up consignments
- Simple repacking or placing goods in bottles, bags or boxes
- Preservation operations such as drying, freezing and chilling
- Affixing marks or labels
- Simple mixing
- Simple assembly or disassembly
- Slaughter
- Mere dilution with water or another substance
- Any combination of the above operations
Therefore, exporters using imported inputs should carefully assess whether the manufacturing process undertaken in India meets the proposed origin criteria.
Non-Preferential Certificate of Origin for Exports
Issuance of CoO
The draft provides for Non-Preferential Certificates of Origin (CoO) to evidence the origin of exported goods. These certificates do not provide entitlement to preferential tariff benefits.
Exporters requiring a Non-Preferential CoO would be required to submit their applications online through trade.gov.in to agencies listed in Appendix 2E.
Documents and Fee
Applicants would need to upload:
- Invoice
- Packing list
A fee of ₹200 per Certificate of Origin, including attestation of additional documents, is proposed.
Self-Certification
Manufacturer exporters who are also Status Holders would be eligible to self-certify their goods as originating from India, provided the goods satisfy the prescribed origin criteria.
The draft also provides for Back-to-Back Non-Preferential Certificates of Origin for goods that are not of Indian origin and are being re-exported, trans-shipped or involved in merchanting trade, subject to documentary evidence confirming their foreign origin.
Proposed Rules for Imports
Goods Under ITC (HS) Chapters 01 to 14
For goods falling under the relevant ITC (HS) Codes in Chapters 01 to 14, the country of origin would be the country where the goods are wholly obtained or produced.
A 1% de-minimis tolerance of the value of the goods is proposed.
Other Imported Goods
For goods outside the above categories, the country of origin would be determined where either:
- All non-originating materials used in manufacture undergo a change in tariff heading at the 4-digit HS level; or
- The good undergoes at least 35% value addition.
Value Addition Formula
The proposed value addition would be calculated using:
Value Addition (%) = [(FOB Value of Exports − Value of Non-Originating Material) / FOB Value of Exports] × 100
This provides a specific framework for assessing whether the required value addition criterion has been achieved.
Importer Self-Declaration
Under the draft provisions, importers would declare the country of origin based on information available to them.
The importer would provide a self-declaration containing details such as:
- Bill of Entry number and date
- ITC (HS) Code
- Country of origin
- Importer name
- IEC
- Signature/authorised signatory
- Date
No Separate CoO for Clearance
The proposed rules state that a separate Certificate of Origin or other origin-related document would not normally be required for customs clearance, unless specifically mandated under applicable law or a notified country-specific requirement.
Goods may be cleared based on the importer’s self-declaration, with verification undertaken subsequently where necessary on a risk-based basis.
Note for Exporters and Importers:
The proposed amendment could bring greater clarity to the determination of Non-Preferential Origin for both exports and imports.
Businesses involved in international trade should review the draft provisions carefully, particularly those relating to manufacturing processes, imported inputs, HS classification, value addition, Certificates of Origin and importer self-declaration.
Stakeholders are encouraged to submit practical comments and suggestions to DGFT within the prescribed period.
Conclusion
DGFT’s proposed amendment to Para 2.93 of the Handbook of Procedures, 2023 seeks to establish comprehensive Non-Preferential Rules of Origin for exports and imports.
The proposed framework introduces specific origin criteria, CoO procedures for exports, self-certification for eligible Status Holder manufacturer exporters, and self-declaration provisions for importers.
As the proposal is currently open for stakeholder comments, exporters, importers and trade bodies should examine the draft and provide their inputs within the specified timeline.
Notification Reference:
DGFT
Trade Notice No.27 /2026-27
14/09/2026