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Free Trade and Warehousing Zones (FTWZs)

Definition as per the SEZ ACT, 2005 “Free Trade and Warehousing Zone” means a Special Economic Zone wherein mainly trading and warehousing and other activities related thereto are carried on”

Activities allowed inside the FTWZ as per the SEZ, Rules 2006 Trading with or without labelling, packaging or repackaging, re-sell, reinvoice or re-export of imported goods. Assembly of complete knocked down and semi knocked down kits

FTWZ Unique Advantages Unique Benefits for Imports * Flexibility towards end distribution in India * Duty deferment benefits (freeing up working capital & increasing sales ) * Quality control capability prior to duty- payment * Exemption on SAD, VAT & CST on imports through FTWZ * Hassle-free re-export regulatory /duty implications * Reduced buffer stocks Service Tax exemption on services availed; including transportation inside India * Lowered product costs * Foreign exchange transaction capability

Unique Benefits for Exports * Products from India entering the FTWZ are treated as deemed export providing immediate benefits to suppliers * Local Tax Exemption (e.g. CST, Sales Tax, Excise & VAT) on all activities conducted inside the FTWZ * Export quotas able to be met for companies exporting into FTWZ * Increased efficiency through lowered reverse logistics through quality control before dispatch from India * Foreign exchange transactions capability * Increasing supply chain efficiencies (forward & reverse) while enhancing capital cash flow

Unique Benefits for Re-Exports * Service tax exemption on all activities conducted inside the FTWZ including rental & labour * Exemption from custom and stamp duty on products imported into FTWZ; meant for re-export out of India * Income tax exemption on profit where applicable * Hassle-free re-export process * Permission of 100% FDI for the set-up of units by the unit holder of the FTWZ * Ability to leverage India’s cost, skill & geographic positioning advantage as a hub for regional/global distribution post Value Addition activities

FTWZ Players in India Arshiya International Ltd. (AIL): www.arshiyainternational.com