What changed
RBI issued clarifications on AA/DFIA for gold imports following representations. It explicitly stated that these authorisations are for export purposes only, with no domestic use allowed. For AA/DFIA issued before August 14, 2013, the requirement to sequence imports before exports is not enforced. Additionally, exports under AA/DFIA do not count toward the 20:80 scheme's export obligation.
What it means for you
Banks and authorised dealers must ensure that gold imported under AA/DFIA is strictly used for exports, preventing any leakage into domestic markets. The waiver of sequencing for pre-August 14, 2013 authorisations eases compliance for earlier cases. Entities in SEZs, EoUs, and trading houses can import gold only for exports, and such exports do not qualify for the 20:80 scheme, impacting how banks monitor export obligations.
What you must do
- Verify that all gold imports under AA/DFIA are used exclusively for export purposes and not diverted domestically.
- For AA/DFIA issued before August 14, 2013, do not insist on the sequencing condition (imports before exports).
- Inform constituents that exports under AA/DFIA do not count toward the 20:80 scheme's export obligation.
- Ensure SEZ, EoU, and trading house clients import gold only for exports, as per the circular.
Who it affects
Scheduled commercial banks acting as Authorised Dealers, Agencies nominated for gold import, Entities in SEZs and EoUs, Premier and Star Trading Houses, Exporters using AA/DFIA for gold
Can gold imported under AA/DFIA be sold in the domestic market?
No, the circular explicitly states that gold imported under AA/DFIA must be used solely for export purposes, with no diversion for domestic use permitted.
Does the sequencing condition apply to AA/DFIA issued before August 14, 2013?
No, for authorisations issued before that date, the condition of sequencing imports prior to exports is not insisted upon.
Do exports under AA/DFIA count toward the 20:80 scheme?
No, such exports do not qualify as exports for the purpose of the 20:80 scheme.