WORLD TRADE  
ORGANIZATION   
G/SCM/N/95/IND 
14 October 2011 
 (11-5053) 
Committee on Subsidies and Countervailing Measures Original:   English 
  
 
SUBSIDIES 
 
New and Full and Updating Notifications Pursuant to Article XVI:1 of the 
GATT 1994 and Article 25 of the SCM Agreement 
 
INDIA 
  The following notification, dated 12 October 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 2001-02 and 2002-03.    1. Title of the subsidy programme, if relevant,  or brief description or identification of the 
subsidy. 
 
 Incentives and facilities offered to th e exporters of certain categories. 
 2. Period covered by the notification.  The peri od to be covered by the notification should 
be the most recently completed calendar or fisca l year.  In the latter case, the start and 
end dates of the fiscal year should be specified. 
 
 (i) 1.4.2001 to 31.3.2002  (ii) 1.4.2002 to 31.3.2003  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/95/IND 
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  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 hundred pe rcent 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 hundred per cent of profits and gains derived by a hundred per cent export-
oriented undertaking from the export of articles 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 hundred per cent of profits and gains derived by an undertaking from the export 
out of India of eligible articles or things (i.e., a ll hand-made articles or things, which are of artistic 
value and which requires the use of wood as the main raw material) from the total income under Section 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 unde rtaken 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 enterprise, in compu ting the total income of the assessee, a deduction from 
such profits and gains of the following amounts would be allowed:    
 (i) forty per cent thereof for an assessment year beginning on the 1s t day of April, 2001; 
(ii) thirty per cent thereof for an assessment y ear beginning on the 1st day of April, 2002; 
 (iii) twenty per cent thereof for an assessment y ear beginning on the 1st day of April, 2003; 
 (iv) ten per cent thereof for an assessment year beginning on the 1st day of April, 2004, 
 and no deduction in respect of the assessment year  beginning on the 1st day of April, 2005 and any 
subsequent assessment year.   
 
(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 execution of a housing project awarded to th e assessee on the basis of global tender and such 
project is aided by the World Bank, there shall, in accordance with and subject to the provisions of 
this section, a deduction from such profits and gain s of the following amounts would be allowed:   
  (i) forty per cent thereof for an assessment year beginning on the 1s t day of April, 2001; 
 (ii) thirty per cent thereof for an assessment year beginning on the 1s t day of April, 2002;  G/SCM/N/95/IND 
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   (iii)  twenty per cent thereof for an assessment year beginning on the 1st day of April, 2003; 
 (iv)  ten per cent thereof for an assessment year beginning on the 1st day of April, 2004, 
 and no deduction in respect of the assessment year  beginning on the 1st day of 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 th e 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 merchandise, a deduction from such profits  and gains of the following amounts would be 
allowed:  
  (i) eighty per cent thereof for an assessment y ear beginning on the 1st day of April, 2001; 
 (ii) seventy per cent thereof for an assessment y ear beginning on the 1st day of April, 2002; 
 (iii) fifty per cent thereof for an assessment y ear beginning on the 1st day of April, 2003; 
 (iv) thirty per cent thereof for an assessment year beginning on the 1s t day of April, 2004, 
 and no deduction shall be allowed in respect of the assessment year beginning on the 1st day of 
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 previo us year, or both) is not possible, a full 
explanation. 
 
 Data not available.  
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 headin g (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 determinable, 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 years for which statistics are available;   G/SCM/N/95/IND 
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   (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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