Manufacturing under Customs Bonded Warehouse – Opening up new possibilities
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Last Updated: Jan 31, 2021, 10:02 AM IST
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Synopsis
The manufacturing industry expects that the government, through the Budget, would bring in incentives or new schemes to infuse fresh life and to also, promote foreign investment in this sector which will assist in generating employment.
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Under the CBWs scheme, a manufacturer is allowed to import duty-free inputs/capital goods for undertaking manufacturing in CBWs.
Union Finance Minister Nirmala Sitharaman would be presenting the Union Budget on 01 February 2021, one of the most critical Budgets in recent times as it would define India’s path to economic recovery. The Indian economy has been severely impacted by the COVID-19 outbreak which has resulted in growing unemployment, led to a sharp fall in the GDP and also lowered industrial output and profits, jeopardising growth prospects, crimping new foreign investment in ma
Four options for manufacturing in India
A leg-up for manufacturing - THE HINDU×
The Manufacturing Under Customs Bond scheme can lead to substantial savings for firms, but it has its pain points
In November last year, the government announced the Production Linked Incentives (PLI) scheme for promoting manufacturing in 10 sectors. The initial response indicates that many new large-scale factories would soon be set up in the PLI supported product groups.
The government provides four broad options for manufacturing in India. Selection of appropriate option results in substantial cost savings. The options are: (i) Domestic Tariff Area (DTA), (ii) Special Economic Zone(SEZ), (iii) 100 per cent export oriented unit (EOU), and (iv) Manufacturing Under Customs Bond (MUCB).
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