DGFT export policy is the core development covered in this report. Below is a sourced breakdown of what is confirmed, what remains uncertain, and why it matters.
Why DGFT export policy matters now
This section focuses on the practical implications of DGFT export policy for readers following the story — what changed, what is confirmed, and what remains open.
On 27 July 2026, the Directorate General of Foreign Trade (DGFT) issued Notification No. 26/2026-27, amending Schedule-II (Export Policy) of the ITC (HS), 2022 so that India’s export-policy classifications stay aligned with tariff changes made by the Finance Act, 2026 (30 March 2026). The amendments take effect immediately.
Legal authority and what was amended
The Central Government acted under Section 3 read with Section 5 of the Foreign Trade (Development & Regulation) Act, 1992, read with Paragraphs 1.02 and 2.01 of the Foreign Trade Policy (FTP) 2023. In substance, the notification does three administrative-legal things:
- Annexure-I: Updates Section Notes, Chapter-wise Main Notes, Sub-Heading Notes, and Supplementary Notes to mirror Finance Act, 2026 changes.
- Annexure-II: Lists ITC (HS) codes that were introduced, deleted, amended, split, or merged pursuant to the Finance Act, together with applicable export-policy status and conditions.
- Publication: States that the updated ITC (HS) will be available on the DGFT website (dgft.gov.in).
The official “Effect of this Notification” line is concise: Schedule-II (Export Policy), ITC (HS) 2022 is amended in line with the Finance Act, 2026, with immediate force. This is a harmonisation exercise—keeping the export-policy schedule consistent with the customs tariff structure—rather than a standalone rewrite of FTP incentives. For public administration, it closes the gap between Finance Act tariff edits and the day-to-day export-policy instrument used by DGFT field offices and customs.
Why exporters should care
Customs bills of entry/shipping bills, DGFT licences, restricted-item clearances, and “Free but with condition” lines all depend on the correct ITC (HS) code. When Finance Act amendments split or merge tariff lines, an exporter who continues using a deleted or superseded code risks documentation rejection, delayed clearance, or mismatched policy conditions (for example, an NOC requirement that now sits on a new line).
Trade advisories note that many chemical and plant-extract lines remain “Free” for export but continue to carry specific policy conditions, such as obtaining a No Objection Certificate from the concerned authority. Harmonisation does not automatically erase those conditions; it relocates or restates them against the updated codes. Compliance teams should therefore treat Annexure-II as the operational checklist, not as a liberalisation circular.
Before vs after
| Dimension | Before Notification 26/2026-27 | After 27 July 2026 |
|---|---|---|
| Tariff vs export-policy alignment | Risk of mismatch after Finance Act, 2026 tariff edits | Schedule-II explicitly realigned to Finance Act, 2026 |
| Notes and supplementary notes | Older Section/Chapter/Sub-heading notes | Annexure-I updates notes to Finance Act text |
| Code inventory | Pre-amendment introduced/deleted/split lines incomplete for 2026 tariff | Annexure-II consolidates code movements and policy status |
| Effective date | Exporters relying on interim workarounds | Immediate effect; systems must use updated codes |
Implementation checklist for compliance teams
- Map master data: Rebuild ERP/product masters where Annexure-II shows splits, mergers, or deletions.
- Re-check policy status: Confirm whether each SKU remains Free, Restricted, or Prohibited, and whether NOC/licence conditions moved with the new code.
- Update templates: Shipping bill descriptions, IEC-linked authorisations, and agent SOPs should cite the new ITC (HS) strings.
- Customs coordination: Align with CHA/customs broker classification opinions where a split creates ambiguity between neighbouring lines.
- Document retention: Keep the 27 July 2026 notification PDF and Annexures with the shipment file for audit trails.
Open implementation questions
- How will ICEGATE and DGFT systems treat shipments filed the same day with legacy codes already accepted in draft?
- Where a code is split, which successor line inherits a previously issued export authorisation—and is endorsement needed?
- Will sectoral regulators (chemicals, wildlife, SCOMET-adjacent items) issue matching circulars for NOC formats tied to old codes?
- What grace practice, if any, will field formations apply for documentation prepared before the notification’s publication hour?
Limitations
Notification 26/2026-27 does not, by itself, change FTP 2023 incentive schemes, RoDTEP rates, or bilateral FTA origin rules. It is a classification/policy-schedule sync. Product-specific duty or restriction outcomes still depend on the Annexure entries and any parallel customs or DGFT instruments. Exporters must read Annexure-II line-by-line rather than assume a blanket liberalisation.
How this fits India’s trade-administration stack
India’s goods trade compliance stack has three layers that must stay synchronised: the Customs Tariff (as amended by Finance Acts), the DGFT ITC (HS) import/export policy schedules, and operational systems (ICEGATE, DGFT online modules, broker software). Notification 26/2026-27 is the mid-year housekeeping step that pulls Schedule-II up to the Finance Act, 2026 baseline. Without it, identical merchandise could be classified one way for duty and another for export-policy status—an invitation to hold-ups at ports and airports.
Public administration offices that issue NOCs keyed to HS codes—chemical regulators, wildlife authorities, or sector ministries—should cross-walk their application forms to Annexure-II. Otherwise applicants will present new codes while portals still validate old ones. That mismatch is an avoidable friction point after any Finance Act tariff rewrite.
Exporters should also distinguish Schedule-II policy status from customs duty rates. A line may be “Free” to export yet still attract export duty, cess, or documentation conditions elsewhere. Conversely, a Restricted line may become workable once a licence or NOC is obtained. Notification 26/2026-27 tells you which code string and note text to use; it does not replace a full reading of FTP chapters, appendices, or product-specific notifications. Where Annexure-II shows a merge, historical shipment data may need dual mapping so analytics remain comparable year-on-year.
A practical sequencing tip: (1) download the notification and Annexures; (2) filter your top export SKUs; (3) mark any code that appears in Annexure-II; (4) update masters before the next shipping bill; (5) brief overseas buyers if HS descriptions on commercial invoices will change. Doing this in one batch reduces mid-month customs queries.
FAQ
When does it apply?
With immediate effect from 27 July 2026, as stated in the notification.
Where is the official text?
DGFT Notification No. 26/2026-27; updated Schedule-II is to be hosted on dgft.gov.in.
Do I need a new IEC?
No. You need correct ITC (HS) mapping and compliance with any policy conditions attached to the new lines.
Is this only for goods exports?
It amends Schedule-II (Export Policy) of ITC (HS) 2022—the goods export-policy schedule keyed to tariff classification.
Primary sources
Disclaimer: Based on the published notification text dated 27 July 2026. Classification disputes should be verified against the gazette/DGFT PDF and professional advice.
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