Why Your Supplier's Country of Origin Affects Your Import Cost
Two buyers sourcing the same product — dehydrated onion, makhana, or turmeric from India — can face meaningfully different landed costs depending entirely on where they import it and whether they use a Preferential Certificate of Origin. The reason is India's growing network of Free Trade Agreements and Comprehensive Economic Partnership Agreements (CEPAs), which reduce or eliminate customs duties for buyers in partner countries.
India currently has active trade agreements with the UAE, Australia, Japan, and South Korea — four of the largest markets for Indian food ingredients. Under these agreements, Indian-origin products exported with the correct documentation can attract significantly lower import duties than products from non-agreement countries. For a buyer importing regularly, this is not a procedural detail — it is a direct cost advantage that improves margins or enables competitive pricing.
This guide explains how India's active FTAs work in practice for food ingredient buyers, what documentation is required to claim benefits, and where to find current duty schedules from official government sources.
Official Source
India's Active FTAs — What Each One Covers
Each agreement has its own tariff schedule — the list of product categories, HS codes, and the duty rates (or duty elimination timelines) that apply. Not every product gets immediate zero-duty treatment; some categories are phased over 5 to 10 years. The details are in the agreement schedules, which are public documents.
India–UAE CEPA (Comprehensive Economic Partnership Agreement)
Effective: May 1, 2022
India committed to preferential duty rates on approximately 97% of its tariff lines for UAE-origin imports. UAE committed to duty concessions across a broad set of Indian exports. For food ingredients, many categories receive immediate or early-phase duty elimination. UAE is one of India's top 3 food export destinations.
Source: Ministry of Commerce & Industry, Government of India. Signed February 18, 2022.
India–Australia ECTA (Economic Cooperation and Trade Agreement)
Effective: December 29, 2022
Australia committed to eliminating tariffs on over 85% of Indian goods immediately, with the remainder phased out over several years. For most food ingredients — makhana, spices, dehydrated vegetables — Australia's standard import duty is already low, but ECTA provides tariff certainty, simplified Rules of Origin, and a preferential framework that can support longer-term trade relationships.
Source: Ministry of Commerce & Industry, Government of India. Signed April 2, 2022.
India–Japan CEPA (Comprehensive Economic Partnership Agreement)
Effective: August 1, 2011
Japan committed to progressive tariff elimination on a large share of Indian exports. Japan is a significant market for Indian spices, organic ingredients, and processed food products. The agreement covers most HS chapters relevant to food ingredient trade, with specific duty schedules that have now been in effect for over a decade. Current concession rates are at or near their final agreed levels.
Source: Ministry of Commerce & Industry, Government of India.
India–South Korea CEPA (Comprehensive Economic Partnership Agreement)
Effective: January 1, 2010
India's first CEPA. Korea committed to duty elimination on a broad range of Indian goods. South Korea is an active importer of Indian spices, moringa, and health food ingredients. Like Japan, this agreement has now reached near-final concession levels after 15 years of phased reductions.
Source: Ministry of Commerce & Industry, Government of India.
How FTA Benefits Work in Practice
Knowing an FTA exists is only the starting point. Claiming the duty benefit requires specific documentation and compliance with Rules of Origin. Missing either means your shipment is cleared under the standard (MFN) duty rate, not the preferential rate — the FTA benefit is simply not claimed.
Step 1 — Verify your product's HS code in the FTA tariff schedule
Each FTA publishes an Annexure listing every tariff line (HS code) and its treatment: elimination, reduction, or exclusion. Look up your specific HS code in the schedule for your destination country. This schedule is available on the India Trade Portal (indiantradeportal.in) and the Ministry of Commerce website. If your HS code is in the exclusion list, the FTA does not apply to that product.
Step 2 — Confirm your product meets Rules of Origin (RoO)
Rules of Origin define what qualifies as Indian-origin for FTA purposes. For agricultural and food products, the standard criterion is "wholly obtained" — meaning the product is grown and processed in India with no non-Indian raw material substitution. For processed food products, a value-addition criterion may apply (typically 35-40% value addition in India). Your APEDA-registered exporter's supply chain should meet this criterion for all products we supply, as they are sourced directly from Indian growing regions.
Step 3 — Obtain a Preferential Certificate of Origin (CoO)
To claim the FTA duty rate, the importer must present a Preferential Certificate of Origin at the destination customs. This document is issued in India by authorised agencies: FIEO (Federation of Indian Export Organisations), the Export Inspection Council, or designated Chambers of Commerce. For APEDA-registered products, APEDA can issue CoO in some cases. This is a different document from the standard non-preferential Certificate of Origin — confirm with your customs broker which format is required.
Step 4 — Importer claims preferential duty at destination customs
The Preferential CoO is presented to the customs authority in the destination country along with the standard import documentation. The customs authority verifies the CoO against the FTA schedule and applies the preferential rate. If documentation is incomplete, the shipment is cleared at the standard MFN rate. The duty saved cannot be reclaimed retroactively in most cases.
Important
FTA Relevance by Product Category
The table below maps the key products we supply to their HS codes and notes FTA relevance by destination market. Verify current duty rates via the India Trade Portal or your customs broker — the notes below reflect general FTA coverage, not specific current rates.
| Product | HS Code | UAE CEPA | AU ECTA | JP CEPA | KR CEPA |
|---|---|---|---|---|---|
| Makhana (popped) | 2008.19.21 | Covered | Covered | Covered | Covered |
| Turmeric (finger/powder) | 0910.30 | Covered | Covered | Covered | Covered |
| Dehydrated onion | 0712.20.00 | Covered | Covered | Covered | Covered |
| Dehydrated garlic | 0712.90.20 | Covered | Covered | Covered | Covered |
| Moringa leaf powder | 1212.21.00 | Covered | Covered | Covered | Covered |
“Covered” means the HS code falls within the FTA's concession schedule. The actual duty rate — whether 0%, a partial reduction, or a phased rate — must be verified from the official schedule for your shipment date. Some products may be in the exclusion list or may attract non-zero preferential rates depending on the specific HS subheading and product form.
Verify Before You Order
Practical Checklist: Claiming FTA Benefits on Your Shipment
If you are importing Indian food ingredients into the UAE, Australia, Japan, or South Korea and are not currently claiming FTA preferential duty rates, work through this checklist with your customs broker before the next shipment.
- Confirm your destination country has an active FTA with India — check commerce.gov.in for the current list of in-force agreements
- Look up your product's HS code in the FTA tariff schedule via the India Trade Portal (indiantradeportal.in) — confirm it is not in the exclusion list
- Verify the current preferential duty rate applies to your shipment date (phased reductions change annually)
- Instruct your Indian supplier to obtain a Preferential Certificate of Origin from FIEO, EIC, or an authorised Chamber of Commerce at the time of shipment
- Confirm Rules of Origin compliance — for wholly-obtained agricultural products, this is straightforward; for processed food, confirm value-addition meets the FTA threshold
- Ensure the Preferential CoO references the correct HS code, product description, and quantity matching the commercial invoice
- Present the Preferential CoO to destination customs with the standard document set — it does not replace but supplements the standard non-preferential CoO
- Keep records — most FTAs require the importer to maintain documentation to support preferential origin claims for a minimum of 3-5 years in case of audit
FAQ: FTA Questions from Buyers
QMy freight forwarder says I am already receiving the lowest duty. Do I need to look into FTAs?
Possibly not, but it is worth verifying. Some destination markets (like Australia) already have low or zero MFN rates on certain agricultural products. In those cases, the FTA benefit may be marginal. For UAE, Japan, and South Korea, the difference between MFN and preferential rates can be meaningful — verify the specific rate for your HS code.
QWho is responsible for obtaining the Preferential Certificate of Origin — the exporter or the importer?
The Preferential Certificate of Origin is a document obtained by the Indian exporter and provided to the importer as part of the document set. The importer then presents it at destination customs to claim the preferential rate. We can obtain the Preferential CoO from FIEO or an authorised Chamber of Commerce for all shipments where you intend to claim FTA benefits — specify this requirement at order stage.
QCan I claim FTA benefits retroactively on past shipments?
In most cases, no. Preferential duty claims must be made at the time of import clearance. Once a shipment is cleared at the standard MFN rate without a Preferential CoO, the duty cannot generally be reclaimed. Some FTAs do allow retrospective claims within a limited window if the CoO was genuinely unavailable at import time — check with your customs broker and the destination country's customs authority for the specific rules.
QDoes the FTA benefit apply to all product forms within an HS chapter, or just specific sub-headings?
The FTA tariff schedule operates at the 6-digit or 8-digit HS code level, and different sub-headings within the same chapter can have different treatments. For example, within Chapter 09 (spices), turmeric finger and turmeric powder may have different duty treatments in some schedules. Always verify at the specific HS code level for your product form.
QIndia does not have an FTA with the US or EU. What applies?
Correct — India does not currently have an FTA with the United States or the European Union. Imports are subject to standard MFN duty rates in both markets. However, some Indian products benefit from the EU's Generalised System of Preferences (GSP) — check whether India's GSP status applies to your product category under current EU rules. India's GSP status with the US was suspended in 2019. For both markets, there are no preferential duty routes currently, and the full MFN duty applies.
