The export industry of India is one of the fastest-growing sectors of the economy. As thousands of companies venture into international trade, compliance with export procedures becomes crucial. Of these, one of the important requirements is important to exporters, the dealer (AD) code. This is important to ensure smooth customs withdrawal and proper exchange of foreign currency.
In this article we will explain why customs outlets, its benefits and ad codes for exporters are required.
Why the ad code required for customs extraction
Customs Documentation
Exporters are unable to create the required Shipping Bill on the ICEGATE portal without an AD Code. Shipping bill is the most important document for customs clearance.
Foreign Exchange Regulation
As foreign currency exchange is involved in international trade, the Reserve Bank of India (RBI) keeps a track of it using AD Codes. This ensures that foreign exchange inflows are directed properly into the account of the exporter.
Port Registration
AD Code registration is mandatory at all ports from where goods are exported by the exporter. This discourages fraud and facilitates transparency in international trade.
Access to Export Incentives
Exporters having AD Code can take advantage of government incentives such as RoDTEP, MEIS (previous), and other duty drawback facilities. They cannot be claimed without it.
Simplified Banking Transactions
AD Code ensures that all export remittances from abroad are credited directly to the exporter's account without delays or rejection.
Advantages of Having an AD Code
Easy Customs Clearance: Allows timely generation of shipping bills.
Regulatory Compliance: Guarantees RBI and DGFT compliance norms.
Financial Transparency: Tracks the legal flow of foreign exchange.
Export Benefits: Necessary to get tax refunds, incentives, and subsidies.
Ease of Doing Business: Simplifies paperwork and facilitates export transactions.
How to Obtain an AD Code?
Visit your bank where you have a current account.
Provide documents such as IEC (import export code), PAN, GST certificate and corporate correction certificate.
The bank will then give you a 14-digit AD Code.
Register this code on the ICEGATE portal for customs clearance from the port of shipment.
Conclusion
For every exporter in India, registration of AD Code is not optional but compulsory for customs clearance. It provides for proper monitoring of export transactions, conformity with RBI guidelines, and trouble-free receipt of export proceeds. Without an AD Code, no shipping bill can be created, and therefore, no goods can be exported legally.
If you are looking to open an export business or require assistance for AD Code registration, E-Startup India offers professional services to make the task easy and compliant at all levels.
