Indian Fiscal Budget 1997-98: EXIM POLICY 1997-2002




12.1The objective of the scheme is to recognise established exporters as Export House, Trading House, Star Trading House and Super Star Trading House with a view to build marketing infrastructure and expertise required for export promotion. Such Houses should operate as highly professional and dynamic institutions and act as important instruments of export growth.


12.2Merchant as well as Manufacturer exporters, Export Oriented Units (EOUs)/units located in Export Processing Zones (EPZs)/ Electronic Hardware Technology Parks (EHTPs)/ Software Technology Parks (STPs) shall be eligible for such recognition.

Criterion for recognition

12.3The eligibility criterion for such recognition shall be either on the basis of the FOB/Net Foreign Exchange (NFE) value of export of goods and services, including software exports, made directly by the exporter during the preceding three licensing years or the preceding licensing year, at the option of the exporter.

Exports made by Subsidiary Company

12.4The export made by a subsidiary of a limited company shall be counted towards export performance of the limited company for the purpose of recognition. For this purpose, the company shall have the majority share holding in the subsidiary company.

Export Performance Level

12.5The applicant is required to achieve the prescribed average export performance level subject to the condition that

(a) Deemed exports, shall not be counted under export performance.

(b)Exports made under the Passbook Scheme shall be counted only if the exporter applies for recognition on the basis of FOB criterion.

(c)If the eligibility is claimed on FOB criterion, the FOB value of exports of diamond, gem & jewellery products shall be counted at 50% of the actual FOB value of exports.

The level of export performance for the purpose of recognition shall be as per the table below:


Category FOB Criterion: Average FOB value of exports made during the preceding three licensing years, in Rupees FOB Criterion: Average FOB value of exports made during the preceding three licensing years, in Rupees NFE Criterion: Average net foreign exchange value of exports made during the preceding three licensing years,in Rupees NFE Criterion: Net foreign exchange value of exports made during the preceding licensing year, in Rupees
ExportHouses 20 crores 30 crores 16 crores 24 crores
TradingHouses 100 crores 150 crores 80 crores 120 crores
Star TradingHouses 500 crores 750 crores 400 crores 600 crores
Super Star Trading Houses 1500 crores 2250 crores 1200 crores 1800 crores

Calculation of NFE

12.6For the purpose of calculation of the Net Foreign Exchange earned on exports, the value of all the licences shall be deducted from the FOB value of exports made by the person. However, the value of freely transferable Special Import Licences, EPCG licences and the value of licences surrendered during the validity of licence and shall not be deducted.

Weightage to exports

12.7For the purpose of recognition, weightage shall be given to the following categories of exports provided such exports are made in freely convertible currency:(a)Double weightage on FOB or NFE on the export of products manufactured by units in the Small Scale Industry (SSI)/Tiny sector/Cottage Sector;(b)Double weightage on FOB value and Triple weightage on NFE on the export of products manufactured by the handlooms and handicraft sector (including handloom made silk products), hand-knotted carpets, carpets made of silk; (c)Double weightage on FOB or NFE on the export of fruits and vegetables, floriculture and horticulture produce/products;(d)Double weightage on FOB or NFE on export of goods manufactured in North Eastern States;(e)Double weightage on FOB or NFE on export to such countries listed in Appendix 33 of the Handbook (Vol.1).

Recognition for State Corporations

12.8With a view to encourage participation of State Government and Union Territories in export promotion, one state corporation nominated by the respective State Governments/ Union Territories may be recognised as an Export House, even though the criterion for such recognition is not fulfilled by them. This benefit shall be available only for such period and in accordance with such terms and conditions as may be specified from time to time.

Validity period

12.9Export House/ Trading House/ Star Trading House/ Super Star Trading House Certificate shall be valid for a period of three years starting from 1st April of the licensing year during which the application for the grant of such recognition is made, unless otherwise specified. On the expiry of such certificate, application for renewal of status certificate shall be required to be made within a period of six months. During the said period, the status holders shall be eligible to claim the usual facilities and benefits, except the benefit of a Special Import Licence (SIL).


12.10 Export Houses/ Trading Houses/ Star Trading Houses/ Super Star Trading Houses shall be entitled to such benefits as specified in Chapter 12 of the Handbook (Vol.1).

Transitional arrangement and Criterion for renewal

12.11Export Houses, Trading Houses, Star Trading Houses and Super Star Trading Houses shall continue to hold the recognition accorded to them for the period for which such recognition was accorded. However, at the expiry of the aforesaid period, they shall satisfy the criterion laid down hereinafter for renewal of such recognition. 12.12Wherever such recognition has been granted for the period commencing from 1.4.97, the exporter, while seeking a renewal of his Certificate, has to achieve a minimum of 20% annual average growth in export performance over the average FOB/NFE value of exports on which such recognition was granted. In case the recognition has been obtained on preceding licensing year basis, 20% growth in export performance shall be calculated on the basis of exports on which such recognition was granted. In case the Certificate holder fails to achieve the minimum prescribed export growth, he may be granted recognition for the lower category, if otherwise eligible.

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