Page 25 - Bullion World Volume 4 Issue 2 February 2024

Bullion World | Volume 4 | Issue 2 | February 2024

CEPA Agreement for the FY 2023-24 is @ 9% of Ioaded onto the carrier at the named port of exportation
prevailing Tariff Value of silver. This custom duty has including the cost of the product, and all costs necessary
been agreed to be eliminated in phased manner over a to bring the product onto the carrier;
period of 10 years as follows:-
Value of NOM means Value of Non-Originating Materials.
FY2022-23 9.50%
FY 2023-24 9.00 % “(NOM)” means any materials whose country of origin
is a country other than the Parties (imported non-
FY 2024-25 8.00%
originating), any materials who’s Origin Cannot be
FY 2025-26 7.00% determined (undetermined origin) or a material that does
FY 2026-27 6.00% not qualify as originating under this Chapter.
FY2027-28 5.00% “Ex-Works price” means the price paid for the product
FY2028-29 4.00% ex-works to the manufacturer in the Party where last
FY2029-30 3.00% working or processing is carried out provided the price
FY2030-31 2.00% includes the value of all the materials used.
FY2031-32 0.00%
The differences in value addition percentages depending
(Source: Annexure 2 A on the Schedule of Specific
Trade Commitments of India on Trade in Goods under on the methodology, i.e. FOB value or Ex-Works price,
CEPA Agreement with UAE) are defined in Annexure 3B (Product Specific Rules) of
CEPA Agreement with UAE.

The above said custom duties will be applicable
irrespective of any subsequent change in standard Notwithstanding paragraph 1 of the Rules of Origin
prevailing custom duties for normal imports (other than under CEPA, the final manufacture before export must
CEPA Agreement). Therefore, custom duty on import of have occurred in the Party of export. Party of export
silver under CEPA with UAE @9.00% for the FY 2023-24 in instant case of silver is of UAE. Please refer Rules
is lower by 6% than the present standard custom duty of of Origin under Chapter 3 of CEPA Agreement which
15%. stipulates requirement of Form 1 and the Minimum
Required Information to ensure Country of Origin Rules
are being complied with.
Product Specific Rules (PSR) for Export of Silver
from UAE to India under CEPA:
HS Code Heading 7106: Silver unwrought, semi Importers of silver under CEPA with UAE have to follow
manufactured CAROTAR Rules 2020 as per Custom Notification
PSR Description: Certified UAE/India Good delivery silver 81/2020 dated 21/8/2020 and amendments thereto from
Bars in Different Denominations time.
Product Specific Rule(PSR) for all the above said HS
Codes of Silver is Change in Sub Heading from any other Import of Silver Grains by Nominated Agencies
Subheading of HS Code i.e. CTSH +3% Value Addition under CEPA Agreement
(Source: Annexure 3 B on Product Specific Rule Some Nominated Agencies imported silver grains from
Referred to in Chapter 3 of CEPA Agreement) UAE under CEPA Agreement with UAE. It is gathered
that they faced certain issues with Customs investigation
in compliance with the Country of Origin Rules which is
Rules of Origin under CEPA with UAE
The producer or manufacturer in UAE has the option to said to be contested by the NA’s. Therefore, NA’s have
use either of the following two Methods of computing the stopped importing silver under CEPA with UAE for the
value addition criteria in the PSR at Annex 3B (Product time being.
Specific Rules):
(a) (FOB value or Ex-Works price) – (Value of NOM) Impact of IIBX on Trade Flow of Silver:
FOB value or Ex-Works Price Qualified Jewellers (QJ’s) are now also allowed to import
Or (b) Cost of originating material + direct labour cost + silver through IIBX.180 tonnes of CEPA silver grains
direct overhead cost traded on IIBX so far (up to January 31st,2023) since
FOB value or Ex-Works price the launch of this contract on December 13th,2023. It
is gathered some QJs have already imported about 113
Tonnes of silver Grains through IIBX since launch of this
“Free-On-Board (FOB) value” means the price actually
paid or payable to the Exporter for a product when contract on December 13, 2023 under CEPA Agreement

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