WORLD TRADE  
ORGANIZATION  G/SCM/N/123/IND/Suppl.1 
1 February 2011 
 (11-0500) 
Committee on Subsidies and 
Countervailing Measures Original:   English 
 
 
 
SUBSIDIES 
 
New and Full Notification Pursuant to Article XVI.1 of  
the GATT 1994 and Article 25 of the Agreement on  
Subsidies and Countervailing Measures  
 
INDIA 
 
Supplement  
 
  The following notification, dated 19 January 2011,  is being circulated at the request of the 
Delegation of India.  
_______________ 
 
  The following notification constitutes the Gove rnment of Republic of India's new subsidy 
notification for the period 2003-04.  1. Title of the subsidy programme, if relevant,  or brief description or identification of the 
subsidy 
 
 Incentives and facilities offered to the exporters of certain categories. 
 
2. Period covered by the notification. The period to be covered by the notification should 
be the most recently completed calendar or fiscal year.  In the latter case, the start and 
end dates of the fiscal year should be specified 
 
 1 April 2003 to 31 March 2004.  3. Policy objective and/or purpose of the subsidy 
 
 To encourage exports from India to  increase foreign exchange reserves. 
 
4. Background and authority for the subsidy (including identification of the legislation 
under which it is granted) 
 
 The subsidy is authorised vide legislati on (i.e., Income Tax Act, 1961) to grant these 
concessions under Sections 10A, 10B, 10BA, 80HHB, 80HHBA and 80HHC of the Act. 
 
5. Form of the subsidy (i.e. gr ant, loan, tax concession, etc.) 
 
 Preferential tax treatment. G/SCM/N/123/IND/Suppl.1 
Page 2  
 
   
6. To whom and how the subsidy is provide d (whether to producers, to exporters, or 
others; through what mechanism' whether a fixed or fluctuating amount per unit;  if the latter, how determined) 
 (a) Exemption available to manufacturing/service  units in Free Trade Zones, Special Economic 
Zones (SEZs) or Export Processing Zones (EPZs):  
  (i) Deduction from the total income of 100 pe r cent of profits and gains derived by an 
undertaking from the export of articles or things for a period of 10 consecutive 
assessment years under Section 10A of the Income Tax Act till 31 March 2009. 
  (ii) Deduction of 100 per cent of profits and gains derived by a 100 per cent export-
oriented undertaking from the export of articl es or things from the total income for a 
period of 10 consecutive assessment years under Section 10B of the Income Tax Act 
till 31 March 2009. 
  (iii) Deduction of 100  per cent of profits and gains derived by an undertaking from the 
export out of India of eligible articles or th ings (i.e., all hand-made articles or things, 
which are of artistic value and which re quires the use of wood as the main raw 
material) from the total income under Sec tion 10BA of the Income Tax Act till 
31 March 2009.  
 (b) Deduction available to income from export/foreign exchange earnings
: 
  (i) Section 80HHB
: Where the gross total income of an assessee being an Indian 
company or a person (other than a company)  who is resident in India includes any 
profits and gains derived from the business of— 
   (a) the execution of a foreign project undertaken by the assessee in pursuance of 
a contract entered into by him, or 
 
  (b) the execution of any work undertaken by him and forming part of a foreign 
project undertaken by any other person in pursuance of a contract entered into by such other person, 
   with the Government of a foreign State or any statutory or other public authority or 
agency in a foreign State, or a foreign ente rprise, in computing the total income of the 
assessee, a deduction from such profits and gains of the following amounts would be 
allowed- 
    (i) 40 per cent thereof for an assessment year beginning on 1 April 2001;  
   (ii) 30 per cent thereof for an assessment year beginning on 1 April 2002; 
    (iii) 20 per cent thereof for an assessment year beginning on 1 April 2003;     (iv) 10 per cent thereof for an assessment year beginning on 1 April 2004,   
 
    and no deduction in respect of the assessment year beginning on 
1 April 2005 and any subsequent assessment year. 
  G/SCM/N/123/IND/Suppl.1 
 Page 3 
 
 
   (ii) Section 80HHBA : Where the gross total income of an assessee being an Indian 
company or a person (other than a company)  who is a resident in India includes any 
profits and gains derived from the executi on of a housing project awarded to the 
assessee on the basis of global tender and such project is aided by the World Bank, a deduction from such profits and gains of the following amounts would be allowed- 
 
  (i) 40 per cent thereof for an assessment year beginning on 1 April 2001;    (ii) 30 per cent thereof for an assessment year beginning on 1 April 2002;  
  (iii) 20 per cent thereof for an assessment year beginning on 1 April 2003; 
   (iv) 10 per cent thereof for an assessment year beginning on 1 April 2004,     and no deduction in respect of the assessment year beginning on 1 April 2005 
and any subsequent assessment year. 
  (iii) Section 80HHC
: Where an assessee, being an Indian company or a person (other than 
a company) resident in India, is engaged in the business of export out of India of any goods or merchandise, a deduction to the extent of profits, derived by the assessee from the export of such goods or mercha ndise, a deduction from such profits and 
gains of the following amounts would be allo wed in computing the total income of 
the assessee- 
   (i) 80 per cent thereof for an assessment year beginning on 1 April 2001;  
  (ii) 70 per cent thereof for an assessment year beginning on 1 April 2002; 
   (iii) 50 per cent thereof for an assessment year beginning on 1 April 2003;    (iv) 30 per cent thereof for an assessment year beginning on 1 April 2004;  
   and no deduction shall be allowed in respect of the assessment year 
beginning on the 1 April 2005 and any subsequent assessment year. 
 NOTE
: 
 
 The tax concessions under Sections 80HHB, 80HHBA and 80HHC under sub para (b) above 
were abolished with effect from 1 April 2005.    
7. Subsidy per unit or in cases where this is not possible, the total amount or the annual 
amount budgeted for that subsidy (indicating, if possible, the average subsidy per unit in 
the previous year). Where provision of per unit subsidy information (for the year 
covered by the notification, for the previous  year, or both) is not possible, a full 
explanation 
 
 Data not available.  G/SCM/N/123/IND/Suppl.1 
Page 4  
 
  8. For the information cited in items 3 to 7 ab ove, the notification does not necessarily have 
to have an independent heading corresp onding to each item, and may provide 
information on multiple items in one heading (e.g. provide information on items 3 and 4 under one heading).  In this case, the notifi cation must clearly specify what items are 
covered by which heading 
 
 As mentioned in Item No. 6.  
9. Duration of the subsidy and/or any other time limits attached to it, including date of 
inception/commencement 
 
 As mentioned in Item No. 6.  
10. Statistical data permitting an assessment of the trade effects of the subsidy.  The specific 
nature and scope of such statistics is left to the judgement of the notifying Member.  To 
the extent possible, relevant and/or determin able, however, it is desirable that such 
information include statistics of production , consumption, imports and exports of the 
subsidized product(s) or sector(s): 
 
 (a) For the three most recent year s for which statistics are available; 
 
 (b) For the previous representative year, wh ich, where possible and meaningful, should 
be the latest year preceding the introduction of the subsidy or preceding the last major 
change in the subsidy. 
   Data not available. 
 
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