DGFT Licensing Explained: What Needs a Licence, What Doesn’t, and How Long It Actually Takes

The short answer, before anything else

Not every import or export needs a licence. Most trade in India moves under a plain Importer Exporter Code with no further permission required. But a specific slice of goods, classified as Restricted under the ITC (HS) Schedule, cannot move at all without a separate authorization from DGFT, issued before the shipment happens, not after.

Confusing an IEC with a DGFT licence is the single most common mistake we see. The IEC gets you into international trade. A Restricted Item authorization, a SCOMET clearance, an Advance Authorization or an EPCG licence are separate permissions layered on top, and they only apply when the specific goods you are moving fall into a controlled category.

Get the classification wrong and the consequence is not a delay. It is a shipment held at port, a possible penalty, and in serious cases an IEC put on hold while the matter is investigated.

Why we are writing this

Rasp International has handled DGFT licensing, liaison and customs work out of Agra since 2005, across leather, handicrafts, textiles, engineering goods, marine and food exports. The pattern that shows up most often is not exporters trying to smuggle something restricted. It is exporters who genuinely did not know a classification had changed, because ITC (HS) restrictions get amended by trade notice with almost no warning.

Gold and silver jewellery under specific HS codes moved from Free to Restricted in March 2026 amid a wider reassessment of trade flows. Plain silver had already been placed under restriction a few months earlier after a sharp surge in imports from one origin country. Palladium, rhodium and iridium alloys crossed the same line in mid 2025. None of these changes were announced with much lead time, and none of them were retroactively excused for shipments already in transit.

This piece exists so you can check your own HS code against the current policy before you commit to an order, not after.

What “restricted” actually means under India’s trade policy

Every item traded internationally sits under an eight digit ITC (HS) code, and every code carries one of four policy statuses.

Free goods move with nothing beyond the standard IEC and shipping documentation. Restricted goods are not banned, but they cannot move without a specific authorization from DGFT, granted case by case. Prohibited goods cannot be traded at all under ordinary channels. State Trading Enterprise goods can only be imported or exported through a designated government agency, regardless of who the actual buyer or seller is.

The distinction that trips people up is between Restricted and Prohibited. A Restricted classification is a door that opens with the right paperwork. A Prohibited classification does not open at all through a licence application.

The DGFT licences that actually exist

DGFT issues several distinct authorizations, and the one you need depends entirely on the goods and the direction of trade.

Restricted Item Import Authorization is required to bring in goods classified as Restricted on the import side. Restricted Item Export Authorization is the mirror version for goods restricted on export, which is common for certain agricultural commodities, minerals and cultural items.

SCOMET Authorization sits in its own category and applies to Special Chemicals, Organisms, Materials, Equipment and Technologies, essentially dual use and strategic goods with defence or proliferation sensitivity. It carries a separate, stricter process from an ordinary restricted item licence and end use certification is central to the application.

Advance Authorization allows duty free import of inputs that go into goods you will export, tied to a fixed export obligation. EPCG allows duty free import of capital equipment against a future export commitment. Both of these are incentive linked authorizations rather than restriction clearances, but they are still DGFT licences and still carry their own compliance calendar.

PIMS and SIMS, which we cover separately, are import monitoring registrations for paper and steel respectively. They function differently from a restricted item licence and are not interchangeable with one.

How the application actually moves through DGFT

The application is filed on the DGFT portal against the Import Management System or Export Management System, never offline except in specific exception cases. You will need the item description, quantity, unit of measurement, HS code, CIF value in Indian and foreign currency, and a Proforma Invoice from the supplier for imports.

The application fee is 0.1% of the CIF value, subject to a floor of Rs 500 and a ceiling of Rs 1,00,000. Payment proof has to be uploaded with the application itself, not after.

For restricted items, the file goes to the Exim Facilitation Committee at DGFT headquarters. Once the EFC approves, an authorization letter is issued and copied to the jurisdictional Regional Authority, which is then required to issue the actual licence within three working days of receiving that approval. In practice the full cycle from filing to a licence in hand typically runs 30 to 60 days, depending on how sensitive the product is, whether another ministry has to issue a No Objection Certificate first, and how clean the documentation was on the first pass.

If the application is incomplete, DGFT rejects it with stated reasons rather than holding it indefinitely. You then have 90 days to rectify and reopen the same application. Miss that window and it is treated as withdrawn, which means starting over.

What happens if you skip it

Restricted item authorizations are pre-shipment approvals only. There is no mechanism to apply after the goods have already left port, and treating it as a formality you can sort out later is the single most expensive assumption we see clients make.

Shipping without the required licence can mean the consignment held at customs, monetary penalty, confiscation of the goods, and in serious or repeated cases suspension of the IEC itself under the Foreign Trade (Development and Regulation) Act. An IEC suspension does not just stop the one shipment. It stops every shipment under that code until it is resolved.

Where this actually breaks

A few patterns account for most of the licensing failures we get called in to fix.

Assuming last year’s classification still holds. ITC (HS) restrictions change by trade notice, sometimes with immediate effect. The gold, silver and precious metal alloy examples above all took effect the same day they were notified. A product that was Free six months ago can be Restricted today.

CIF value mismatch against the Proforma Invoice. The application fee and much of the scrutiny is anchored to CIF value. A figure that does not reconcile with the PI is one of the fastest ways to get flagged for clarification, which resets your timeline.

Missing the sector specific NOC. Certain categories, health products, chemicals, and items with security sensitivity among them, need a No Objection Certificate from the relevant administrative ministry before DGFT will process the file at all. Applicants who file without checking this first lose weeks waiting on a step they did not know existed.

Treating the licence as permanent. A restricted export authorization is generally valid for 24 months from issuance, with no provision for extension once that period runs out. Import side authorizations can be revalidated by DGFT headquarters, but only for six months at a time, on merit, not automatically. Plan the shipment schedule against the validity window, not against when you happened to apply.

Frequently asked questions about DGFT licensing

If you are not sure which category your goods fall under

The fastest way to lose money on a restricted item is to find out its status after the goods are already on a vessel. Rasp International checks the current ITC (HS) classification against your specific product before you commit to an order, and if a licence is needed, we handle the DGFT filing, the documentation, and the follow up with the Regional Authority through to issuance. If you are planning a shipment involving anything outside a straightforward Free category item, it is worth a quick check before you place the order, not after.