Service Exports from India Scheme (SEIS)

The new five year Foreign Trade Policy (FTP) 2015-2020 introduces the ‘Service Exports from India Scheme (SEIS)’. This reward scheme shall come into force from the date of notification i.e. 1.04.2015. The rewards under SEIS shall be admissible for services rendered on or after the date of notification of this Policy.

The SEIS is to encourage export of notified services from India. The motto of the scheme is to provide rewards to exporters to offset infrastructural inefficiencies and associated costs involved and to provide exporters a level playing field. Also in order to give boost to exports from SEZ, the FTP has extended the reward scheme to units located in SEZs.

In order to lay emphasis on export of services, the Served from India Scheme (SFIS) is replaced by Service Exports from India Scheme (SEIS) .The intention is to provide benefits to all service providers located in India, instead of Indian Service Providers. Earlier, under SFIS the benefit was not available for foreign brand of the Indian companies.

Eligibility Criteria under SEIS

  1. Service Providers of notified services, located in India shall be rewarded under the scheme subject to the rendering of the services in the following mode as specified by Para 9.51(i) and Para 9.51(ii) of the FTP 2015-2020:
  2. a) Cross border trade: Supply of a ‘service’ from India to any other country.
  3. b) Consumption abroad: Supply of a ‘service’ from India to service consumer(s) of any other country in India.
  4. Such Service Provider should have minimum net free foreign exchange earnings in preceding financial years for:

Providers and sole proprietorship: US$10,000

Others: US$15,000

  1. Net Foreign exchange earnings for the scheme are defined as under:

Net Foreign Exchange = Gross Earnings of Foreign Exchange minus Total expenses / payment / remittances of Foreign Exchange by the IEC holder, relating to service sector in the Financial year.

  1. If the IEC holder is a manufacturer of goods as well as service provider, then the foreign exchange earnings and Total expenses / payment / remittances shall be taken into account for service sector only.
  2. Payment earned in India Rupees on specified services shall be deemed foreign earnings as per the guidelines of Reserve Bank of India.
  3. In order to claim reward under the scheme, service provider shall have to have an active IEC at the time of rendering such services for which rewards are claimed.

Ineligible categories under SEIS

  1. The following mode specified by Para 9.51 (iii) and Para 9.52 (iv) of FTP2015-2020 is not eligible for reward under the scheme:
  2. a) Commercial Presence: Supply of a ‘service’ from India through commercial presence in any other country.
  3. b) Presence of natural persons: Supply of a ‘service’ from India through the presence of natural persons in any other country.
  4. Foreign exchange remittances other than those earned for rendering of notified services would not be counted for entitlement. Thus, other sources of foreign exchange earnings such as equity or debt participation, donations, receipts of repayment of loans etc. and any other inflow of foreign exchange, unrelated to rendering of service, would be ineligible.