MOOWR scheme benefits
The most flexible customs duty deferment scheme available to Indian manufacturers
The Manufacture and Other Operations in Warehouse Regulations, 2019 — issued under Section 65 of the Customs Act, 1962 — let manufacturers defer 100% of customs duty on imported inputs and capital goods, with no export obligation and no investment threshold.
100% deferment of Basic Customs Duty
BCD on imported inputs and capital goods is deferred at landing. No upfront cash outflow at the port.
100% deferment of IGST on imports
IGST that would otherwise hit your books at clearance is deferred until DTA sale — directly releasing working capital.
Anti-Dumping & Safeguard Duty deferment
ADD, CVD and Safeguard Duty also stand deferred — a critical advantage for steel, chemicals and electronics importers.
No export obligation
Unlike EOU/EPCG/Advance Authorization, MOOWR imposes no export obligation, no NFE requirement and no minimum value addition.
Capital goods duty deferred indefinitely — no interest
BCD on imported capital goods stays deferred for as long as the asset is installed and used within the MOOWR unit. Duty is triggered only on physical removal of the capital goods, computed on original CIF value, with no interest even after many years.
Pan-India eligibility
Available across all states with no geographical clustering, no SEZ-style ring-fencing, and no minimum land area requirement.
Brownfield conversion permitted
Existing factories can be converted into Section 65 bonded units without halting production.
Indefinite warehousing period
Goods can remain bonded for an indefinite period — there is no rigid storage timeline as under standard Section 61 warehousing.
Job work & sub-contracting allowed
Inputs may be sent for job work to non-MOOWR units under prescribed safeguards, preserving operational flexibility.
The financial impact, in plain numbers
An importer landing ₹100 crore of inputs annually at an effective import-duty incidence of 22% (typical 7.5% BCD + Social Welfare Surcharge + 18% IGST) would otherwise pay ₹22 crore in cash at the port every year. Under MOOWR, that ₹22 crore stays in operating accounts — equivalent, at a 9.5% cost of capital, to ₹2.09 crore of pure interest savings each year, before counting any IGST credit cycle benefit.
MOOWR vs. EOU vs. SEZ vs. EPCG — at a glance
A quick parameter-by-parameter comparison. For full structural analysis see our scheme-comparison notes.
| Parameter | MOOWR | EOU | SEZ | EPCG |
|---|---|---|---|---|
| BCD on inputs | Deferred | Exempt | Exempt | Payable |
| IGST on imports | Deferred | Exempt (with conditions) | Exempt | Payable (creditable) |
| Export obligation | None | Yes (NFE positive) | Yes (NFE positive) | 6× duty saved in 6 yrs |
| Min. investment | None | ₹1 Cr (P&M) | Sector-specific | None |
| Geographical limit | Any location | Any location | Notified zones only | Any location |
| DTA sale | Permitted on duty payment | Permitted (full duty) | Treated as import | Permitted |
| Capital goods BCD | Deferred until physical removal of asset; no interest | Exempt (with EO) | Exempt | Conditional (EO-linked) |
Indicative summary; actual treatment depends on goods, sector and notifications in force on the date of import.
Frequently asked questions
Is duty under MOOWR a deferment or an exemption?
MOOWR provides a complete deferment of Basic Customs Duty (BCD), IGST and applicable Anti-Dumping or Countervailing Duty at the time of import. Duty on inputs becomes payable only on clearance of finished goods into the Domestic Tariff Area, and duty on imported capital goods becomes payable only when the capital goods are physically removed from the MOOWR unit (computed on the original CIF value, with no interest even after many years). If finished goods are exported, the input duty is permanently extinguished. Critically, MOOWR carries no interest liability whatsoever on the deferred duty.
Is there any export obligation under MOOWR?
No. Unlike EOU, EPCG or Advance Authorization, MOOWR carries zero export obligation. A unit can sell 100% in the domestic market or 100% in export markets — both are equally permissible.
Does MOOWR have a minimum investment requirement?
No statutory minimum investment, net foreign exchange earning, or turnover threshold is prescribed under MOOWR. The benefit is equally available to a small contract manufacturer and a multi-billion-rupee plant.
Can existing factories be converted into MOOWR units?
Yes. A brownfield licence converts an existing manufacturing facility into a Section 65 bonded warehouse. The factory continues operations during the conversion; only customs control measures and IT-system integration are added.
What duties remain payable under MOOWR?
GST on domestic procurements continues to apply normally and is creditable. Cess such as Social Welfare Surcharge follows the BCD treatment. State levies (electricity duty, stamp duty) are unaffected.
See exactly what your plant would save under MOOWR
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