What is FTWZ? A Complete Guide to Free Trade Warehousing Zones in India

A Free Trade Warehousing Zone (FTWZ) is a type of Special Economic Zone (SEZ) in India established specifically for warehousing and trading activities. Governed by the SEZ Act 2005 and SEZ Rules 2006, FTWZ facilities are treated as foreign territory for customs purposes — goods inside are not considered to have entered India until cleared for domestic sale. FTWZ differs from a regular bonded warehouse because: • It allows value-added services: repacking, relabeling, kitting, quality inspection • Permits re-export without any customs duty • Supports partial domestic clearance — clear a portion, keep the rest duty-free • Recognized under the SEZ Act with a robust legal framework

Free Trade Zone (FTZ) is a global generic term for designated areas with relaxed trade regulations. In India this concept is implemented as FTWZ under the SEZ Act. FTWZ (Free Trade Warehousing Zone) is India's specific implementation — focused purely on warehousing and trading of goods. It is a subset of SEZ. SEZ (Special Economic Zone) is a broader category including manufacturing, IT parks, and other economic activities. FTWZ is a type of SEZ focused only on storage and trade. Bonded Warehouse is a customs-controlled facility for duty deferment — less flexible, no value-added services, limited re-export facilitation. For Indian importers and global companies routing trade through India, FTWZ offers the most comprehensive benefit package.

1. 100% Customs Duty and GST Deferment — goods stored in FTWZ do not attract customs duty or IGST until cleared for domestic sale. Deferrable indefinitely. 2. Re-export Without Duty — goods re-exported from FTWZ to any country attract zero customs duty, zero IGST, zero GST. Ideal for India-based regional distribution hubs. 3. Value-Added Services — repacking, relabeling, kitting, quality inspection, sorting, and minor assembly — without triggering duty liability. 4. Partial Domestic Clearance — clear a portion of inventory for domestic sale while keeping the rest duty-free. 5. No Time Limit on Storage — no mandatory clearance timeline, ideal for strategic inventory management. 6. Operational Flexibility — consolidate from multiple origins, break bulk, repack, and distribute from the FTWZ network.

When goods arrive at an Indian port and are transferred to FTWZ: 1. Goods enter under a Bill of Entry for Warehousing — zero duty paid 2. Goods are stored under customs supervision inside FTWZ 3. For domestic sale: DTA clearance is filed, duty + IGST paid only on quantity being cleared 4. For re-export: goods leave under Shipping Bill with zero duty Example: An importer with 1,000 units can clear 200 for domestic sale (paying duty on 200 only) and re-export 800 units with zero duty — a significant cash flow advantage over traditional import clearance.

Astromar Logistics operates FTWZ facilities at: • Chennai Sriperumbudur — near Chennai Port, serving South India auto, electronics, pharma • Chennai Vallur — near Kamarajar Port, serving heavy industries and chemicals • Mumbai JNPA — adjacent to Jawaharlal Nehru Port, India's largest container port • Mumbai Panvel — serving FMCG, electronics, and retail sectors • Kochi Vallarpadam — at ICTT, serving Kerala and South India trade • Vizag Duvvada — at VSEZ, serving East India and pharma exporters • Delhi Khurja — serving North India manufacturing and trading • Bengaluru Devanahalli — at Aerospace SEZ, serving aerospace and electronics • Dahej Gujarat — serving chemical, petrochemical, and industrial sectors

FTWZ is ideal for: • Importers wanting to defer customs duty and IGST until goods are sold • Exporters consolidating goods from multiple overseas suppliers • Multinational companies using India as a regional distribution hub • Pharma companies needing GDP-compliant cold storage with duty-free status • Electronics companies needing secure duty-free storage for high-value components • FMCG companies managing seasonal inventory without upfront duty payments • Trading companies importing for both domestic sale and re-export

1. Identify your FTWZ location based on port of import or customer base 2. Sign a warehousing agreement with an FTWZ operator like Astromar Logistics 3. Obtain IEC (Import Export Code) — mandatory for all import-export in India 4. File Bill of Entry for Warehousing at port of entry — duty deferred 5. Transfer goods to FTWZ under customs supervision 6. Manage inventory — request DTA clearance or re-export as needed 7. Pay duty only on DTA clearance, only on quantity cleared Astromar Logistics handles all documentation, customs filing, and logistics coordination.