What changed
Previously, the extended IES was not available to any beneficiary of a Production Linked Incentive (PLI) scheme. Now, the government has clarified that such exporters can still get IES benefits for segments not covered by their PLI claim. Banks must collect a self-declaration from exporters in the prescribed format, effective from October 1, 2021.
What it means for you
Banks can now extend IES benefits to PLI beneficiaries for non-PLI product segments, expanding the eligible exporter base. This requires updating internal IES processing systems to verify the self-declaration and ensure compliance. The retroactive effective date means banks may need to process claims for past periods from October 1, 2021.
What you must do
- Update IES application forms to include the new self-declaration format from the annex.
- Train staff to verify that exporters claiming IES for a segment are not also claiming PLI for the same segment.
- Process retroactive claims from October 1, 2021, for eligible exporters who previously were denied IES due to PLI status.
- Maintain records of self-declarations for audit and compliance purposes.
Who it affects
All Scheduled Commercial Banks (excluding RRBs), Small Finance Banks, Primary (Urban) Cooperative Banks, State Cooperative Banks with AD Category-I license, Exim Bank, Exporters availing IES and PLI schemes
Can an exporter who gets PLI benefits for one product still claim IES for another product?
Yes, as per the government clarification, the extended IES is available for segments other than the one for which PLI benefits are availed.
What document must banks obtain from exporters under this circular?
Banks must obtain a Self-Declaration from exporters in the format given in the annex, confirming they are not availing PLI for the same segment covered by the IES application.
From when is this clarification effective?
The provisions are deemed effective from October 1, 2021, meaning banks should apply this rule to claims from that date onward.