Inventory-based Cross-border E-Commerce Export Framework

About Inventory-based Cross-border E-Commerce Export Framework

• The Government of India has operationalised the Inventory-based Cross-border E-Commerce Export Framework under the Foreign Trade Policy (FTP), 2023.
• It is  to establish a structured mechanism for inventory-based cross-border e-commerce exports of goods manufactured or produced in India.
• Features: 
  • Export Mechanism: Eligible e-commerce entities can undertake export-only inventory operations through a registered Exporter-on-Record (EOR), who procures goods from Indian Sellers-on-Record (SORs) only against confirmed overseas orders and exports them in its own name.
  • Role of the Exporter-on-Record: The Exporter-on-Record is responsible for export documentation, customs clearance, destination-country regulatory compliance, product testing and certification, packaging, labelling, order fulfilment, logistics, and reverse logistics.
  • Benefits for Indian Sellers: The framework enables Indian sellers to access international markets while allowing them to focus on manufacturing, production, and innovation by outsourcing export-related processes to the EOR.
  • Timely Payments and Transparency: The framework guarantees timely payments to Sellers-on-Record within the prescribed timeline, irrespective of payment received from overseas buyers, and provides sellers with visibility into final sale prices, order status, and shipment tracking.
  • Export Benefits: Export rebates and refunds must be shared with Sellers-on-Record in proportion to the Free on Board (FOB) value of their goods, ensuring that export incentives are passed on to the actual producers.
  • Safeguards for Export Operations: The framework permits procurement of export inventory only against confirmed overseas orders, prohibits speculative inventory creation, requires digital identification and segregation of export inventory for complete traceability, and prohibits diversion of export inventory into the domestic market.
  • Handling of Returned Goods: Returned or rejected consignments must be re-exported, returned to the seller, or disposed of strictly in accordance with the prescribed procedures.
  • Compliance Requirements: The framework mandates annual compliance certification and maintenance of digital records to strengthen transparency, accountability, and regulatory oversight.
• Expected Outcomes: The framework is expected to increase the participation of Indian manufacturers, traders, and MSMEs in global e-commerce supply chains by reducing compliance costs, improving market access, ensuring transparency, and strengthening the delivery of export benefits.