Government Assures Time-Bound Implementation of SEZ Scheme with Focus on Exports, Duty Relief Estimate at Rs 1,800 Crore

Government Announces Special Economic Zone Relief Scheme Amid Global Trade Disruptions

The Centre's newly announced Special Economic Zone (SEZ) relief scheme is a "strictly time-bound intervention" designed to help units navigate current global trade disruptions, a government source said on April 2.

The scheme, announced by the Central Board of Indirect Taxes and Customs (CBIC) on April 1, permits eligible manufacturing units in SEZs to sell goods in the domestic market at concessional customs duty rates for a limited period. The official said the core objective of SEZs remains unchanged, adding that allowing units to sell in the domestic tariff area (DTA) does not dilute the export focus.

The scheme's aim is to allow SEZ units to optimally utilise their capacity in the time of trade disruption. To achieve this, the duty structure has been calibrated to provide a level playing field between SEZ units and domestic manufacturers. However, food and petroleum products have been kept outside the scheme's ambit to protect domestic industry.

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Revenue Impact of the Scheme

The government estimated a revenue loss of about Rs 1,800 crore over three months due to the customs duty reductions under the scheme, according to the source.

Indirect Tax Collections

Separately, the government said it has met its indirect tax targets for FY26 at the revised estimate (RE) level. A government source said:

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The official added that the Centre is "doing reasonably well" in meeting its indirect tax targets for the fiscal year.

Impact of Recent Changes on FY27 Revenue Estimate

A government source said it is difficult to provide a realistic revenue estimate for FY27 at this stage, adding that an assessment of the impact of recent changes in customs and central excise duties is still underway.

Key Features of the Relief Measure

The relief measure, announced in the Union Budget 2026-27, will be in effect from April 1, 2026, to March 31, 2027, and is being implemented through a notification under the Customs Act, 1962. Under the scheme, concessional duty rates have been prescribed across multiple slabs for specified goods. Eligible SEZ units must have commenced production on or before March 31, 2025, and must ensure a minimum value addition of 20% over inputs.

DTA sales under the scheme have been capped at 30% of the highest annual free-on-board (FOB) value of exports achieved by the unit in any of the previous three financial years, maintaining the export-oriented character of SEZs. Clearances will be processed through CBIC's automated systems under the faceless assessment mechanism, with the Finance Ministry expected to issue detailed guidelines and FAQs.

Context: Trade Disruptions and Policy Response

The scheme comes amid ongoing global trade disruptions linked to geopolitical tensions, which have affected supply chains and export flows. Officials said the measure should be viewed in this broader context. SEZs in India have historically been structured as export-focused enclaves with limited access to the domestic market, and policy frameworks have sought to maintain this orientation while offering fiscal incentives.