India is part of international agreements focused on disarmament & non-proliferation, such as the Biological & Toxin Weapons Convention (BWC) and the Chemical Weapons Convention (CWC). UN Security Council Resolution 1540 mandates that all member states restrict the transfer of weapons of mass destruction (WMD) and related materials, equipment, and tech to non-state actors, particularly for terrorism.
India is also involved in three key multilateral export control groups, the Australia Group (for biological & chemical goods), the Wassenaar Arrangement (for munitions & military items), and the Missile Technology Control Regime (MTCR) for missiles & related systems. India controls the export of dual-use, nuclear, & military goods—including software & technology—according to international guidelines, control lists, and agreements.
India's strategic trade control system is crucial for promoting ethical trade, global cooperation, and national security, SCOMET (Special Chemicals, Organisms, Materials, Equipment, and Technologies) regime is an important set of rules that controls the export of sensitive products, including software. It stands apart from other regulatory frameworks. Companies in high-tech sectors need to understand SCOMET licensing to ensure compliance and run operations smoothly within India's regulatory guidelines.
SCOMET (Special Chemicals, Organisms, Materials, Equipment, and Technologies)Control Regime
Foreign Trade Act (Development and Regulation) of 1992 created the SCOMET rules, which regulate items crucial for military, national security, and strategic goals. Included are materials, living organisms, tools, equipment, and technology with both civilian & military uses, or those that could potentially contribute to the spread of weapons or other harmful activities.
The Directorate General of Foreign Trade (DGFT) of India regularly updates the SCOMET list to reflect changing concerns about international security and technical developments.
SCOMET List export
Special Chemicals, Organisms, Materials, Equipment, and Technologies, or SCOMET items, are dual-use products with potential uses in both civilian and military contexts. The SCOMET List products are subject to export regulations under India's Foreign Trade Policy. To export SCOMET, the exporter needs to get a license from the Ministry of Commerce's Directorate General of Foreign Trade.
The eight categories of SCOMET items are as follows:
SCOMET SCOMET category 0: Nuclear material, equipment, technology, and nuclear-related other materials
SCOMET category 1: Toxic chemical agent and other chemicals.
SCOMET category 2: Microorganisms and toxins.
SCOMET category 3: Material, Materials Processing Equipments, and other material-related technologies.
SCOMET category 4: Nuclear-related equipment, test, and production types of equipment; assemblies and components of nuclear; and related technology, not controlled under SCOMET category 0.
SCOMET category 5: Aerospace system, equipment including productions and test types of equipment, related technology, and specially designed components and accessories.
SCOMET category 6: Munitions List
SCOMET category 7: Computers, electronic, and information technology, including information security.
SCOMET category 8: Special Materials and Related Types of equipment, Electronics, Computers, Material Processing, Information Security, Sensors, Telecommunications and Lasers, Avionics, Marine, Aerospace Navigation, and Propulsion.
Important elements of List and the implications of its dual use
Special Chemicals
This group includes substances used across various industries, like agriculture & pharmaceuticals, that have properties making them possible for use in chemical weapons or military purposes. For instance, certain chemicals in these sectors could be turned into chemical weapons.
Organisms
Biological agents and organisms fall under this area, It includes organisms that have the potential to be useful in the medical, agricultural, or industrial domains, but also pose a risk in terms of biological weapons or bioterrorism.
Materials
Materials covered by the SCOMET framework can be used in both military and civilian contexts, this includes metals, alloys, composites, and specialty materials with properties that make them suitable for use in two or more applications.
Equipment
Various types of machinery, apparatuses, or systems with the potential for dual-use characteristics that could be useful in strategic fields.
Technologies
The tech side of SCOMET covers knowledge & skills that can be used in many industries. It includes technologies used in research, development, & production, but also plays a role in the military and the creation of weapons of mass destruction (WMDs)
SCOMET License Registration Process
Prior SCOMET registration/ authorisation from the appropriate authorities is required for any person or organisation wishing to export SCOMET goods. The Ministry of Commerce and Industry's Department of Commerce is in charge of managing SCOMET registration to avail a license via the DGFT. The licensing procedure entails a close examination to determine any possible hazards related to the transfer of restricted goods.
Export of SCOMET Products for Display
No endues or end-user certifications are needed for licenses to export items on the SCOMET List (apart from Categories 0, 1, and 2) purely for display or exhibition. No export authorisation will be granted for the display of "Technology" in any SCOMET category or for any products falling under Categories 0, 1, or 2.
Export permits for SCOMET items intended for international exhibitions are contingent upon a six-month period of re-importation. If the exhibitor plans to sell the item overseas during the show, the merchant must apply for an export license. Such a sale of SCOMET goods cannot occur in the absence of a license.
Export of chemicals permitted to specified countries without authorisation
- Repair and return of imported SCOMET items after repair abroad
- Return of SCOMET items (imported/ indigenous) after demo/ display/ exhibition/ RFP/ RFQ/ tender etc., abroad
- Stock and Sale
- Global Authorisation for Intra-company Transfer (GAICT)
- Others, if mandated in export authorisations.
SCOMET items exported from the DTA to the SEZ
Without SCOMET registration or SCOMET license products may be supplied from the Domestic Tariff Area (DTA) to the Special Economic Zone (SEZ). Nonetheless, all SCOMET item deliveries from the Domestic Tariff Area to the Special Financial Site must be reported by the providers to the Development Commissioner of the relevant SEZ.
SCOMET Items may be exported from SEZ to any other nation.
When physically exporting goods from the Special Economic Zone (SCOMET) to another country outside of India, export license is required.
DGFT New SCOMET Module
By virtue of DGFT Trade Notice 11/2021-2022, issued 28/07/2021, DGFT launches a new online module for filing Export Authorisations for SCOMET registration as part of the IT Revamp of the exporter/importer-related services. It is recommended that all exporters wishing to get export authorisation for commodities covered by SCOMET apply online via this new Module. The export of items on the SCOMET List (i.e., special chemicals, organisms, materials, equipment, and technologies) is governed by the Foreign Trade Policy (FTP) 2015-2020. The details of the new DGFT and SCOMET modules are covered below:
Important Announcement for Exporters
It is recommended that all exporters wishing to apply for export authorisation for SCOMET commodities do so online via the official DGFT website.
- Applications must be filed online for the issuance of export permission for SCOMET products as well as for their alteration or revalidation.
- With effect from August 5, 2021, SCOMET authorisations will continue to be given from DGFT HQ, Udyog Bhawan, and New Delhi via the New Online Module.
- The SCOMET Cell, DGFT (HQ), will remain the focal point for all matters pertaining to SCOMET.
- As of May 8, 2021, all pending applications that are now pending will be automatically transferred to this new system and handled at DGFT (HQ).
New Process as part of the New SCOMET Module
This new SCOMET Module will also include the following processes that can be accessed online:
- Permission for a Site Visit by a Foreign Entity to the Indian Manufacturer/Exporter's Premises with the Type of IEC to Verify the Production Processes for SCOMET Export Items
- In the following situations, post-reporting of export of SCOMET items, software, and technology
Licensing Authority
- Licenses for exporting goods listed in SCOMET List Categories 1, 2, 3, 4, 5, 7, and 8 are granted by the Directorate General of Foreign Trade.
- The Department of Atomic Energy is the licensing authority for products in SCOMET category 0.
- The Ministry of Defence's Department of Defence Production is the designated body for exporting goods included in SCOMET List SCOMET category 6.
Validity of SCOMET License
The export license has a 24-month validity period, however it can be renewed by the DGFT regional office for an additional six months or a full year with permission from the DGFT headquarters.
Documentation Needed to Get a License to Export SCOMET Items
When submitting an online application to obtain SCOMET authorisation, the following documents must be uploaded:
- All companies participating in the product supply chain must provide an End Use-cum-End User Certificate (EUC), which must be provided on letterhead and signed by an authorised signatory.
- Purchase orders from companies involved in the product supply chain
- Complete the Aayat Niryat Form (ANF)-1 to provide detailed technical specifications for the SCOMET export item.
- Provide the contract document (if the documents are large, you can submit the pertinent section that has the parties' names and the contract reference).
- DGFT product permission letter for SCOMET authorisation.
- The following documents must be submitted in physical copy to the DGFT Head Office:
- Original Bills of Entry into the destination country for SCOMET items shipped in the previous year, along with the End Use-cum-End User Certificate (EUC).
Specified format for the End User Certificate (EUC)
The exporter must utilise a certain EUC format from the Handbook of Procedures, depending on the product SCOMET category and SCOMET authorisation.
- For the export of SCOMET goods in Categories 2, 3, 5, 7, and 8, see Appendix 2S (i).
- To apply for a specific SCOMET permit for the export of SCOMET items in SCOMET category 1, see Appendix 2S (ii).
- The End-User Certificate (EUC) from the Foreign Buyer, if distinct from the End User, is required in order to apply for a "Stock and Sale" SCOMET license for the export of all SCOMET items (Appendix 2S (iii).
- If the Consignee's End-User Certificate (EUC) differs from that of the Foreign Buyer and End User, please provide it.
- End-User Certificates (EUCs) from Foreign Buyers, Consignees, and End Users, if any, must accurately depict the orderly transit of the commodities.
Application Procedure for SCOMET License
The exporter must go to :
- the new DGFT Portal's main page. Once there,
- click on the Service option and choose Export Management System.
- The exporter must choose the SCOMET Application Module after logging into the DGFT portal using the ECOM application module via Digital Certificate. Then,
- select the "create" option, a message box containing your 20-digit ECOM Reference number will show up. Click OK to continue.
Business Details
Enter the information below on the main screen, and then click the save button to store the data.
- Phone number, fax number, and email address submit the shipping information, including the port of shipment, the port of discharge, the exporting nation, the final destination country, and the export's purpose. In the next tab, submit the details from the date and up to the current date.
- From the dropdown box, choose the relevant Jurisdictional Regional Authority.
- Enter the ITC (HS) code, SCOMET permit category , SCOMET item number name, and item description on the Item of Export screen.
- The exporter is required to provide the consignee and foreign buyer with details after submitting their own.
Bank Details
The international bank account number, the destination country bank location, the IFSC code (Indian Financial System Code), the SWIFT code (Society for Worldwide Interbank Financial Telecommunication Code), and the exporter's SWIFT code must all be provided. Once all the information has been entered, the exporter must click the declaration button and enter their name, official address, and phone number.
Upload Documents
All supporting documentation must be attached by the exporter before clicking the submit button. When the application form appears, click the download button to obtain a hard copy of it. An exporter must submit this application form to DGFT (Headquarters), Udyog Bhawan, New Delhi, along with the required documentation in order to receive a license to export SCOMET products.
Processing of Application
Under the direction of the Additional Director General of Foreign Trade, the Inter-Ministerial Working Group (IMWG) of the DGFT shall evaluate each request for the export of SCOMET goods on its own merits.
Evaluation of application
When evaluating an application to export items from the SCOMET List, the following criteria will be taken into account:
- End-user credentials, the veracity of statements about the article's intended purpose, the integrity of the SCOMET item's transmission from supplier to end-user, and the item's or technology's potential
- The estimated danger that goods exported will end up in the hands of non-state actors, terrorist organisations, or terrorists
- measures implemented by the destination state to control exports
- The goals and capacities of recipient states' programs regarding armaments and delivery
- Evaluation of the item's final usage
- Application of applicable agreements to which India is party for an export license
SCOMET License
The exporter will get a clearance letter for SCOMET permit export license from the zonal or regional office of the Director-General of Foreign Trade once the request has been approved by the Inter-Ministerial Working Group. The exporter can obtain the license from the relevant regional or zonal office.
Therefore, it is necessary to fully understand and carry out an in-depth analysis of the products that a company produces with the intention of exporting them in order to determine whether or not the SCOMET license applies to them. The idea is more complicated than it would first seem. The suitability of the licensing process must be ascertained by a thorough analysis of the SCOMET classification. Exporters without SCOMET permits may still face difficulties in the future, even if they have been exporting goods without any problems up to this point. This is a result of the government building strong software systems, intelligence gathering techniques, and expanding its knowledge base.