Chapter 3 of the FTP 2015-20  contains the provision of Status Holder. Status Holders are business leaders who have excelled in international trade and have successfully contributed to country’s foreign trade. Status Holders are expected to not only contribute towards India’s exports but also provide guidance and handholding to new entrepreneurs. The unique Provision has been specified under foreign trade policy to issue Status Holder certificates to certain category of exporters and the objective is to boost export production as well as to enhance exports performances of the Country.

Qualifying Requirement as Status Holder:

Chapter 3 and paragraph 3.21 of Foreign Trade Policy 2015-20 has prescribed the following requirement to recognize an exporter as Status Holder.

(i) All exporters of goods, services and technology having an import – export code (IEC) number shall be eligible for recognition as a status holder.

(ii) Status recognition will depend on export performance.

(iii) An Applicant shall be categorized as status holder on achieving export performance during the current and previous three financial years but in case of Gem & Jewellery sector the performance during the current and previous two years.

(iv) The export performance will be counted on the basis of FOB of export earning in freely convertible foreign currencies.

(v) For deemed export, FOR value of exports in Indian Rupees shall be converted in US$ at the exchange rate notified rate notified by CBEC, as applicable on 1’st April of each Financial Year.

(vi) For granting status, export performance is necessary in at least two out of four years.

Status Category as per paragraph 3.21 of the FTP is summarized as under.

Sl.No Status Category Export Performance FOB / FOR ( as converted) Value ( in US$ million)
1 One Star Export House                        3
2 Two Star Export House                        25
3 Three Star Export House                       100
4 Four Star Export House                       500
5 Five Star Export House                      2000

Grant of Double Weightage for Calculation of performance:

The paragraph 3.22 of Chapter of Foreign Trade Policy has provided certain criteria to consider double weightage for calculation of export performance:

(a) The exports by IEC holders under the following categories shall be granted double weightage for calculation of export performance for grant of status.

(i) Micro, Small & Medium Enterprises (MSME) as defined in Micro, Small & Medium Enterprises Development (MSMED) Act, 2006.

(ii) Manufacturing units having ISO / BIS.

(iii) Units located in North Eastern States including Sikkim and Jammu & Kashmir.

(iv) Units located in Agri Export Zones.

(v) Double Weightage shall be available for grant of One Star Export House Status category only. Such benefit of double weightage shall not be admissible for grant of status recognition of other categories namely Two Star Export House, Three Star Export House, Four Star Export House and Five Star Export House.

(vi) A shipment can get double weightage only once in any one of above categories.

Other conditions for grant of Status Holder :

The paragraph 3.23 of Chapter 3 of foreign trade policy has specified other conditions for grant of Status holder certificate:

(a) Export performance of one IEC holder shall not be permitted to be transferred to another IEC holder. Hence, calculation of exports performance based on disclaimer shall not be allowed.

(b) Exports made on re-export basis shall not be counted for recognition.

(c) Export of items under Authorisation, including SCOMET items, would be included for calculation of export performance.

Privileges of Status Holders:

The paragraph 3.23 of Chapter 3 of foreign trade policy-2015-20 has prescribed the various privileges the Status holders shall be eligible to avail is listed as under:

(a) Authorisation and Customs Clearances for both imports and exports may be granted on self-declaration basis;

(b) Input-Output norms may be fixed on priority within 60 days by the Norms Committee; Special scheme in respect of Input Output Norms to be notified by DGFT from time to time, for specified status holder;

(c) Exemption from furnishing of Bank Guarantee for Schemes under FTP, unless specified otherwise anywhere in FTP or HBP;

(d) Exemption from compulsory negotiation of documents through banks. Remittance / receipts, however, would be received through banking channels;

(e) Two Star and above Export houses shall be permitted to establish Export Warehouse as per Department of Revenue guidelines.

(f) Three Star and above Export House shall be entitled to get benefit of Accredited Clients Programme ( ACP) as per the guidelines of CBEC;

(g) The status holders would be entitled to preferential treatment and priority in handling of their consignments by the concerned agencies;

(h) Manufacturers who are also status holders ( Three Star / Four Star / Five Star ) will be enabled to self-certify their manufactured goods( as per their IEM/IL/LOI) as originating from India with a view to qualify for preferential treatment under different preferential trading agreements ( PTA), Free Trade Agreements ( FTAs), Comprehensive Economic Cooperation Agreements ( CECA) and Comprehensive Economic Partnership Agreements ( CEPA). Subsequently, the scheme may be extended to remaining Status Holders.

(i) Manufacturer exporters who are also Status Holders shall be eligible to self-certify their goods as originating from India as Para 2.108 (d) of Hand Book of Procedures.

(j) Status holders shall be entitled to export freely exportable items ( excluding Gems and Jewellery, Articles of Gold and precious metals) on free of cost basis for export promotion subject to an annual limit of Rupees one Crore or 2% of average annual export realization during preceding three licensing years, whichever is lower.

Conclusion: The very objective of Foreign Trade Policy is to make export and import procedure very simple and attractive for the traders, exporters and importers.  There are various export promotion schemes under Chapter 3 of the Foreign Trade Polivy. The provision of Status Holder is one of the export promotion scheme has been specified under Foreign Trade Policy. The exporters having outstanding performance in the previous 2 years out of 4 years and meeting required conditions as prescribed there under only eligible to get Status  Holder certificate. The Status Holder Certificate used to grant to both manufacturer exporters as well as merchant exporters. The various privileges have been awarded to Status Holders only to encourage exporters to boost of exports production and enhance export performance thereby increase inflow of foreign exchange earnings for the country. This is one of the attractive provision has been provided under foreign trade policy as announced by the Ministry of Commerce and industry, Department of Commerce, the Government of India.

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