About the Scheme

Introduced to facilitate industrial growth and ease of doing business, the Project Import Scheme (PIS) is governed by Chapter 98 of the Customs Tariff Act specifically Heading 9801.

The scheme allows importers to register an entire project as a single unit with Customs, instead of filing separate Bills of Entry for every capital item.

Under this scheme, all goods required for the initial setting up, substantial expansion, modernization, or diversification of a project can be cleared at a uniform concessional rate of customs duty.

Key Advantage: Reduction in effective customs duty, ease of documentation, and faster clearances—particularly critical for high-value industrial projects.

Project Import Scheme

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Key Legal Provisions

Legal Reference

Description

Tariff Heading 9801

Covers goods required for setting up of an industrial plant, power project, irrigation, mining, or similar undertakings

Project Import Regulations, 1986

Lays down procedures for registration, assessment, and finalization

Customs Act, 1962 – Section 25

Enables issue of exemption notifications providing concessional rates

CBIC Circulars & Notifications (Notification 45/2025)

Define eligible projects, authorities, and documentation norms

Project Import Scheme Eligibility

Who Can Avail

The scheme is available to importers undertaking approved projects in India. Typical eligible entities include:

Industrial undertakings setting up manufacturing units or factories
Power generation or transmission projects
Oil & gas, refinery, and petrochemical complexes
Water supply projects
EPC contractors executing turnkey projects
Infrastructure projects (metro, ports, airports, water treatment)
Government undertakings and PSUs under approved projects

Each project must be supported by a sponsoring authority (e.g., respective line Ministry, Directorate General of Technical Development, or State Industrial Development Corporation)

Goods Eligible Under Project Imports

The following goods are allowed to be imported at concessional rate of duty:

All items of machinery including
- Prime movers
- Instruments
- Apparatus and appliances
- Control gear and transmission equipment
Auxiliary equipment (required for research and development purposes, testing, and quality control
All components (whether finished or not) or raw materials for the manufacture of the aforementioned items and their components, required for the initial set up of a unit, or the substantial expansion of an existing unit
Spare parts, other raw materials. (Including semi-finished material) or consumable stores not exceeding 10% of the value of the goods specified above
Spare parts, raw materials, or consumable stores can be imported if these are essential for the maintenance of the plant or project

Step-by-Step Procedure to Apply for Project Import Scheme

1. Project Approval & Sponsorship

Obtain a recommendation letter from the competent sponsoring authority (e.g., DGTD, Department of Power, MNRE, etc.).

2. Contract Finalisation

Finalise and register the import contract(s) with the jurisdictional Customs House before the first import.

3. Registration with Customs

Submit the application for Project Import registration along with the sponsoring authority letter, project report, and list of goods.

4. Assessment of Imports

Each Bill of Entry filed thereafter is assessed under Tariff Heading 9801, linked to the registered project.

5. Execution of Bond and BG

Importer executes a bond with bank guarantee to ensure end-use and finalization compliance.

6. Finalisation of Contract

Upon project completion, a final statement of imports is filed indicating the details of goods imported together with document proof regarding value and quantity of good imported. Customs finalizes the project by verifying actual imports vis-à-vis approved list.

Our Services

At CCC, we provide end-to-end Project Import consulting, including :

Eligibility evaluation and project mapping

Preparation of registration application and documentation

Liaison with Customs and Sponsoring Authority

Assessment and bond execution support

Finalisation filing and closure assistance

Frequently Asked Questions (FAQs) for Project Import Scheme

Q1. What is the primary purpose of the Project Import Scheme?

To streamline import of all capital goods for an approved project under a single customs heading and concessional duty rate.

Q2. Can foreign EPC contractors avail the scheme?

Yes, if they are registered as the importer or are executing the project through an Indian entity.

Q3. Can goods imported under Project Imports be transferred to another project?

Only with prior permission from Customs; unauthorized transfer may attract duty and penalties.

Q4. Is prior registration mandatory?

Absolutely. Registration must be completed before the first import; post-facto registration is not permissible.

Q5. Are spare parts and consumables covered?

Essential spare parts required for commissioning are allowed; routine consumables are not.

Q6. How is the project finally closed with Customs?

Through submission of reconciliation statements, CE certificates, and project completion documents for contract finalisation.

Q7. What happens if project timelines are extended?

Customs may extend the bond validity upon request and justification.

Q8. What is the Validity of the Project Import Scheme

No physical control is exercised. The scheme is trust-based, but Customs may conduct audits, inspections, and verification.

Q9. What is Sponsoring Authority under Project Import Scheme

The concessional rate of duty under the Project Import Scheme applies only to specified projects sponsored by specified sponsoring authorities with a detailed itemized list of goods. Under this scheme, the goods will only be imported after duly attested by the sponsoring authority and imported under specific contracts registered before the import of the goods.

The sponsoring authority for a project import depends on the project's nature; for example, the Ministry of Food Processing Industries sponsors food processing projects.

The sponsoring authority provides the necessary approval to allow the project to register with customs and proceed with the import.

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