What are the Benefits of Using FTZ Warehouse in India?
Before we talk about the benefits of FTZ Warehouse in India, it is pertinent to have a quick overview of the FTWZs.
FTZs are also called “duty-free zones” or foreign trade warehousing zones (FTWZs). Precisely, FTZ or free trade zone refers to an area located inside the SEZs (special economic zones) of the country and is specifically meant for landing, stacking, handling, packaging, labeling, reconfiguring, and re-exporting goods.
The free trade zones in India offer a wide range of warehousing services such as packing management, sorting, strapping, kitting, and inspection. The companies benefit from the compliance, duty, and tax benefits as well. The ultimate aim of such relaxations is to boost trans-border trade relations.
The best part of using FTWZ warehousing services is that you don’t have to worry about paying upfront customs duties, certain taxes, and fees that you must pay when importing goods otherwise. Those are only applicable when goods are moved out of these zones for selling in the country’s marketplace. It means you have to pay the partial payment of duties of your cargo that moves out for DTA Sales.
The FTWZs of OSV has been exceptionally successful and have been acknowledged by the nations such as the USA, Japan, China, Singapore, Dubai, and Switzerland among others. Our FTWZ warehousing units in India are located across Delhi NCR, Mumbai, Chennai, and Gujarat. These world-class facilities are the chosen import destination for countless businesses that export to India or Import in India.
Here are the 7 benefits that your get by utilizing FTWZ –
1. Deferred Duty: Almost all merchants/traders/distributors/importers/suppliers love this benefit associated with using a free trade warehousing zone for importing and/or importing to India. It simply means that stocking your cargo inside the FTZs relieves you from the stress of paying upfront customs duties and certain taxes. The duty you save this way can turn out to be savings that you can use for other business purposes/opportunities.
Whether you are into Pharma import in India or cosmetics import in India or just an importer of other goods in India, FTWZs are an apt fitment for you. The duty applies only when you decide to move the stocks out for domestic tariff area (DTA) sales else there’s no duty that you need to pay on your permissible cargo inside FTWZ.
2. Storage for Longer Tenures Possible: While the permitted duration for storing goods inside the FTWZ is that of 3 years but then you can continue extending this period by 5 years. What’s more, you don’t need to pay any duty or fees when you re-export the goods from FTWZ. This means your supply chain becomes more time flexible and cost-effective.
3. Customs Clearance is a Breeze Without Detention & Demurrage: The hassles and stress involved in customs clearance vanish automatically when you choose to use the FTZ warehouse in India for importing goods. Furthermore, customs clearance becomes fast and easy and you don’t need to spend days getting the clearance or pay the detention and demurrage if any query arises as your shipment moves directly from Port/ICD to FTWZ. With our in-house CHAs, you can expect the process to shrink to just 24 to 48 hrs. at the most and 12 hours in several cases.
4. Reduced Burden of Licensing: There’s no need of obtaining drug Licenses/BIS/FSSAI/approvals/certifications for importing goods in the FTZ. However, you’ll need these licenses only when you move the goods out for DTA.
5. No Need for Permanent Establishment: While setting up a permanent establishment in the country where you intend to do a business is the first prerequisite to start your business, you can avoid it by simply using our FTWZ warehousing services<. You don’t need to worry about the compliances as we are here to take care of it all as your custodian.
6. JIT Delivery: When you choose the FTWZ services, you ensure JIT (just in time) delivery of inventory by way of aligned raw-material orders from suppliers with production schedules. The FTWZ warehousing system helps businesses take advantage of the JIT model thereby helping build a stronger, efficient, reliable, responsive, and highly competitive supply chain for suppliers and importers while disrupting market volatility proofs.
7. Value Addition: Your decision to use FTWZs helps add value proposition to your business processes such as kitting, repackaging, packing, lashing, strapping, re-labeling, palletization, clubbing, and others customized as per clients’ need.
If all these benefits amuse you, you can speak with our supply chain consultants for further discussion on the FTWZ warehousing services.
Please feel free to contact us!!