WORLD TRADE  
ORGANIZATION  G/SCM/N/155/IND* 
G/SCM/N/123/IND 29 October 2010 
 
(10-5731) 
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 
  
 The following notification, dated 25 October 201 0, is being circulated at the request of the 
Delegation of India.  
_______________ 
 
 
 The following notification constitutes the Government of Republic of India's new notification 
of information on programmes granted or maintained at the central government level in India.  In 
general, the period to which the following inform ation applies is for the Financial Years 2004-05, 
2005-06, 2006-07, 2007-08 and 2008-09.  
 In so far as the notification obligation is a tr ansparency-orientated provi sion that, pursuant to 
Article 25.7 of the Agreement, carries no legal weight  as to the actual identification or measurement 
of a subsidy, its actionability status, or its trade effects, India has included certain activities in this 
notification which arguably are not (or are not always ) "specific subsidies" within the meaning of the 
Agreement. 
 
1. Title of the subsidy programme 
 
 Preferential tax policies for certain enterprises.  
2. Period covered by the notification.  The period  to be covered by the notification should 
be the most recently completed calendar or fi scal year.  In the latter case, the start and 
end dates of the fiscal year should be specified 
 
(i) 1 April 2004 to 31 March 2005 
(ii) 1 April 2005 to 31 March 2006 
(iii) 1 April 2006 to 31 March 2007 
  (iv)  1 April 2007 to 31 March 2008   (v)  1 April 2008 to 31 March 2009 
                                                     
 
* Please note that this document has the same content as G/SCM/N/186/IND.   G/SCM/N/155/IND 
G/SCM/N/123/IND Page 2 
 
 
  3.   Policy objective and/or purpose of the subsidy 
 
 (a)  Generation of add itional economic activity 
 (b)  Promotion of exports of goods 
 (c)  Promotion of investment from domestic and foreign sources 
 (d)  Creation of employment opportunities  (e)  Development of infrastructure facilities 
 
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, 10AA, 10B, 10BA, 80 -IAB and 115-O of the Act administered by 
the Ministry of Finance. 
 
5.   Form of the subsidy (i.e., grant, loan, tax concession, etc.) 
 
 Preferential tax treatment. 
 
6.   To whom and how the subsidy is provi ded (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 units in Free Tr ade Zones, Special Economic Zones (SEZs) or 
Export Processing Zones (EPZs) : 
 
(i) Deduction from the total income of 100 per cent of profits and gains derived 
by an undertaking from the export of articles for a period of 10 consecutive assessment years under Section 10 A of the Income Tax Act till 31 March 2009. 
 
   (For the years 2004-05 to 2008-09) 
 
(ii) Deduction from the total income of 100 per cent of profits and gains derived 
by a unit located in an SEZ from the export of articles for the first 5 consecutive assessment years, of 50 per cent for further 5 assessment years and thereafter of fifty per cent of the ploughed back export profit for next 5 years under Section 10AA of the Income Tax Act. 
 
   (For the years 2005-06 to 2008-09) 
 
(iii) Deduction of 100 per cent of profits and gains derived by 100 per cent 
export-oriented undertaking from the export of articles from the total income for a period of 10 consecutive assessment years under Section 10B of the 
Income Tax Act till 31 March 2009. 
 
   (For the years 2004-05 to 2008-09) 
 
(iv) Deduction of 100 per cent of profits a nd gains derived by an undertaking 
from the export out of India of eligible articles or things (i.e., all 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. 
 
   (For the years 2005-06 to 2008-09)  G/SCM/N/155/IND 
 G/SCM/N/123/IND 
 Page 3 
 
 
   (b)  Exemption available to the developers of SEZs : 
 
 Deduction of 100 per cent of profits and gains derived by an undertaking from the 
business of development of a Special Economic Zone (SEZ) notified on or after 
1 April 2005 from the total income for any ten consecutive assessment years out of 
fifteen years beginning from the year in which the SEZ has been notified by the Central Government under Section 80-IAB of the Income Tax Act. 
 
  (For the years 2005-06 to 2008-09) 
 
 (c)  Exemption from dividend distribution tax under Section 115-O
 of the Income Tax 
Act in respect of the total income of an undertaking or enterprise engaged in developing or developing and operating or developing, operating and maintaining a 
Special Economic Zone. 
 
  (For the years 2005-06 to 2008-09) 
 
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. 
 8.   For the information cited in items 3 to 7 above, 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  
 
 Data not available.  
 
__________