Published: 30 Jul 2026
DGFT Updates ITC (HS) Export Policy Schedule to Align with Finance Act 2026: What Exporters Need to Know
Omega QMS Compliance Insights
Omega QMS
The Directorate General of Foreign Trade (DGFT) has issued Notification No. 26/2026-27 dated 27 July 2026, updating Schedule-II (Export Policy) of the ITC (HS) 2022 to align with the tariff amendments introduced under the Finance Act, 2026.
The notification is primarily a technical harmonization exercise, but it affects numerous tariff classifications across agricultural products, chemicals, minerals, pharmaceuticals and food products. The aim is to keep India’s export policy classifications fully synchronized with the Customs Tariff, so exporters can use consistent and up-to-date HS codes across export documentation and customs procedures.
Exporters, customs brokers, logistics providers and compliance teams should review these changes to avoid classification mismatches, documentation errors and delays in customs clearance.
Key Takeaways
Schedule-II (Export Policy) has been aligned with the Finance Act, 2026 tariff amendments.
New and revised ITC (HS) classifications have been introduced across multiple product categories.
Several broad tariff entries have been split into more specific product codes.
Export duty and policy entries in the Supplementary Notes have been updated for various chapters.
Exporters should review and update product classifications, ERP systems and shipping documentation.
Effective from 27 July 2026.
Why Has DGFT Issued This Notification?
India’s export policy is based on the Indian Trade Classification (Harmonized System) [ITC (HS)], which is closely linked to the Customs Tariff. Whenever the Finance Act changes tariff classifications by adding new tariff lines, splitting or merging existing codes, or revising duty structures, DGFT updates Schedule-II (Export Policy) so that both systems remain aligned.
This harmonization prevents inconsistencies between customs tariff classifications and export policy codes, letting exporters classify products accurately and comply with current regulatory requirements.
What Has Changed?
New Tariff Items for Previously Broad Categories
Products once under generic or residual entries now have dedicated 8-digit ITC (HS) codes, improving trade data accuracy, traceability and customs reporting. Examples:
- Krill (Chapter 3)
- Pecan nuts (Chapter 8)
- Cranberries (Chapter 8)
- Blueberries (Chapter 8)
- Shea nuts (Chapter 12)
Expanded Classification of Botanical Extracts
Chapter 13 has been significantly restructured. Previously grouped plant and herbal extracts are now split into individual classifications, including:
- Turmeric
- Ginger
- Tulsi
- Indian Gooseberry (Amla)
- Other named botanical extracts
Specialty Chemicals and Pharmaceutical Intermediates
Chapter 29 carries one of the most extensive updates, with numerous new or revised classifications. Examples:
- Gibberellic Acid
- Artemisinin
- Piperidine compounds
- Various pharmaceutical intermediates
Revised Duty and Policy Entries
Supplementary Notes across Chapters 25, 28 and several others now reflect:
- Updated export duty percentages
- Revised policy conditions
- “Free” export status for numerous inorganic chemical tariff items
The finer chemical classifications give more granular product identification and strengthen regulatory monitoring of chemicals with industrial, pharmaceutical or dual-use applications.
Why This Matters for Exporters
The notification does not introduce major policy restrictions, but it has important compliance implications. Schedule-II is the foundation of India’s export policy framework, determining the classifications used for export documentation, policy conditions and incentive mapping.
Using outdated or superseded ITC (HS) codes could result in the issues below. Make sure your export documentation reflects the updated classifications before your next shipment.
- Customs queries during export clearance
- Shipping bill validation issues
- Delays in customs processing
- Incorrect export duty assessment
- Errors in RoDTEP or Duty Drawback claims
- Additional compliance reviews
Industries Likely to Be Impacted
The notification is particularly relevant for businesses involved in:
- Agricultural exports
- Dry fruits and nuts
- Food processing
- Herbal extracts and botanical products
- Specialty chemicals
- Pharmaceutical intermediates
- Mineral products
- Chemical manufacturing
- International trading companies
- Customs brokerage and freight forwarding
Recommended Actions for Exporters
Review your export processes proactively to ensure compliance with the revised Schedule-II:
Compare Classifications
Compare existing product classifications with the revised ITC (HS) Schedule.
Update Systems and Documents
Update ERP systems, product databases and customs documentation.
Review Templates and Records
Review shipping bill templates and internal classification records.
Verify Export Duty Entries
Verify the applicability of revised export duty entries.
Confirm Incentive Classifications
Confirm RoDTEP and Duty Drawback classifications where product codes have changed.
Train Your Teams
Train export documentation and compliance teams on the revised classifications.
Taking these steps now can minimize operational disruptions and support smooth customs clearance.
Business Impact
Many of the amendments are technical, but they require operational updates across export compliance processes. Companies exporting products covered by the revised classifications should review whether:
- Existing HS codes remain valid
- Internal ERP and documentation systems require updates
- Product master databases reflect the latest classifications
- Customs brokers and logistics partners are using the updated codes
- Export incentive claims reference the correct tariff classifications
Early review and implementation can reduce compliance risks and prevent avoidable shipment delays.
How Omega QMS Can Help
Keeping pace with evolving DGFT notifications and tariff amendments can be challenging, particularly for businesses managing large product portfolios or exporting across multiple jurisdictions. Omega QMS provides comprehensive DGFT and trade compliance advisory services, including:
- ITC (HS) product classification reviews
- DGFT regulatory advisory
- Export policy interpretation
- Customs tariff mapping
- Export documentation compliance
- RoDTEP and Duty Drawback advisory
- Import and export licensing support
- End-to-end trade compliance consulting
Our experts work closely with manufacturers, exporters, importers and multinational companies to help ensure regulatory compliance while minimizing operational disruptions.
Conclusion
DGFT Notification No. 26/2026-27 is primarily a harmonization measure, aligning Schedule-II (Export Policy) of the ITC (HS) 2022 with the tariff amendments introduced under the Finance Act, 2026.
It does not substantially alter India’s export policy, but it introduces important classification updates across agricultural products, chemicals, botanical extracts, minerals and pharmaceutical intermediates. Businesses should review the changes promptly so that export documentation, customs declarations and internal systems reflect the latest ITC (HS) classifications. Timely compliance helps exporters avoid customs queries, shipment delays and documentation errors.
Frequently Asked Questions (FAQs)
No. The notification primarily aligns Schedule-II (Export Policy) with the tariff amendments introduced through the Finance Act, 2026.
The revised Schedule-II came into force with immediate effect from 27 July 2026.
Exporters of agricultural products, food products, botanical extracts, chemicals, pharmaceutical intermediates, minerals and related commodities should review the revised classifications.
Yes. Verify whether your products fall under newly created, revised or split tariff classifications, and update export documentation where required.
Synchronizing the Export Policy Schedule with the Customs Tariff removes classification inconsistencies, supports accurate customs declarations and reduces compliance risk during exports.
Exporting Under the Revised ITC (HS) Codes?
Need help checking whether your product classifications and export documentation are up to date?
Source: Directorate General of Foreign Trade (DGFT), Ministry of Commerce & Industry. Notification No. 26/2026-27, dated 27 July 2026.
Subject: Harmonisation of Schedule-II (Export Policy), ITC (HS) 2022 with amendments introduced through the Finance Act, 2026.
Disclaimer: This article is for general informational purposes only and should not be construed as legal or regulatory advice. Businesses should consult qualified professionals for guidance specific to their products and export operations.
