Project Import or MOOWR Scheme: Which Duty Saving Route is Better for You?

Setting up a new industrial project or expanding your manufacturing operations?

CCC is here to help you if you know where to look, there are powerful schemes designed to significantly reduce your upfront costs. Two of the most popular routes businesses often evaluate are the Project Import Scheme and the MOOWR Scheme (Manufacture and Other Operations in Warehouse Regulations). While both offer duty benefits, their applications, compliance structures, and suitability differ.

Aspect	Project Import Scheme	MOOWR Scheme (Manufacture and Other Operations in Warehouse Regulations)
Purpose	To facilitate import of capital goods and components required for initial setup of a project at concessional duty rates.	To defer customs duty and IGST on import of raw materials and capital goods for manufacturing and other operations in a bonded warehouse.
Governing Law	Customs Tariff Act, 1975 (Heading 9801)	Section 65 of Customs Act, 1962
Key Benefit	Concessional Basic Customs Duty (BCD) of 5% for eligible projects. IGST to be paid at the time of imports.	No upfront payment of BCD, IGST; duty is paid on inputs used only when goods are cleared for home consumption.
Target Users	Large infrastructure or industrial projects (e.g. power plants, refineries, metro, airports).	Manufacturers looking to optimize working capital and duty costs.
Type of Imports Allowed	Capital goods, spares, components, and accessories required for initial setup.	Capital goods, raw materials, consumables for manufacturing/other operations.
IGST Exemption	Not exempted – IGST is applicable.	Yes, IGST is deferred (can be avoided completely if goods are exported).
Export Obligation	No export obligation.	No export obligation either. Duty is deferred, not exempt.
Compliance Burden	Moderate – one-time contract registration and approval from sponsoring authority and submission of installation certificate after installation of the imported goods.	Moderate to High –monthly returns on transfer of goods, risk audits.
End Use	Goods must be used strictly for the registered project.	Flexibility to manufacture, repair, re-package, or export.
Duty Security Requirement	Under the Project Import Scheme, a bank guarantee (BG) is required, typically at 2% - 5% of the CIF value of the goods, up to a maximum of one crore rupees.	Under the MOOWR Scheme a triple duty bond equivalent to three time the duty saved amount is required to be executed after the grant of license

Both the Project Import Scheme and the MOOWR Scheme are strategic instruments tailored to different business models. If you're launching a large-scale infrastructure project, the Project Import Scheme can help you reduce your capital import costs with minimal ongoing compliance. On the other hand, if you are a manufacturer aiming to streamline cash flow and gain flexibility in operations, the MOOWR Scheme is a game-changer, especially for export-oriented or duty-sensitive businesses.

Need help choosing or implementing the right scheme? CCC’s expert consultants can guide you through approvals, licensing, and compliance - from planning to execution.