In the competitive landscape of international trade, credibility and trust define the fate of an exporter. Indian exporters who prove themselves to be consistent in performance and contribute heavily towards foreign trade in the nation are acknowledged by the Government of India via the Status Holder Certificate. The government's gesture of appreciation is commonly referred to as the star export house scheme, which is one of the most valued recognitions one could get as an exporter.
The Status Holder Certificate is not merely a designation – it bestows privileges, legal advantages, and international recognition that render the existence of a status holder exporter significantly simpler than for others. For an Indian export house, gaining this recognition means easier trade operations, access to concessions, and improved reputation with foreign buyers.
What is a Status Holder Certificate?
Status Holder Certificate is issued to goods, service, or technology exporters who have attained a specified level of export performance during a certain time period. The recognition is to:
- Select those exporters who are international trade performers.
- Invite them to become mentors to new exporters.
- Provide them with facilities that enhance trade efficiency.
- The awards are mainly titled as a star export house, and exporters are classified into five ranks based on their performance.
Classification of Star Export Houses
Exporters who meet the threshold export performance in the current and the preceding three financial years (based on FOB value) are classified as follows:
- Two Star Export House – USD 15 million
- Three Star Export House – USD 50 million
- Four Star Export House – USD 200 million
- Five Star Export House – USD 800 million
Such ranking categorization makes it possible for even small exporters to start off as a one-star export house and step by step progress to upper levels. For most firms, becoming a star house export is a milestone in their development.
Relevance of Status Holder Certificate in Export and Import
Star export house certificate holds immense significance in the actual trade world. Here are the primary reasons for its importance:
1. Recognition and Credibility
Buyers from abroad seldom deal with unknown exporters. A status holder exporter certified by the Indian government via DGFT automatically receives credibility and recognition in the international market.
2. Easy Customs Procedures
Star export houses are eligible for self-declaration-based clearances for export and import, which saves precious time at the ports. This facilitates faster cycles of shipment and lower transaction charges.
3. Financial Benefits
The certificate holders, especially those categorized as export house of India, are exempted from providing bank guarantees under different schemes, which minimizes financial burdens.
4. Access to Incentives
The government offers special incentives such as priority authorization processing, preferential export warehouse treatment, and simplified input-output norm fixation for a star export house.
5. Competitive Advantage
Recognition as an export house in India provides exporters with a distinctive selling point while interacting with foreign buyers, banks, and institutions.
6. Contribution to Skill Development
Greater category star export houses are likely to guide and educate fresh exporters, thereby supporting the entire trade environment.
Privileges of Status Holders
Privileges of a status holder exporter are:
- Self-Declaration Clearances: Customs and DGFT approvals on a self-declaration basis.
- Faster Norms Fixation: Preferential fixation of input-output norms.
- Exemption from Bank Guarantee: Unless otherwise specified, star export houses are exempted from providing guarantees.
- Direct Remittances: Exempted from mandatory negotiation of documents by banks.
- Export Warehousing: Two star and above grades can establish export warehouses.
- Preferential Treatment: Priority handling of consignments.
- Self-Certification of Origin: Three star and above manufacturers can self-certify merchandise for preferential treatment under FTAs and PTAs.
- Free of Cost Exports for Promotion: 2% of export realization permissible for free-of-cost export promotion.
Compliance and Validity
The Status Holder Certificate is for five years. Exporters have to:
- Keep export and import account books for two years.
- File annual export statements.
- Avoid fraud, misrepresentation, or violation of FT (D&R) Act.
Non-compliance can lead to suspension or withdrawal of the star export house certificate.
Upgrading the Status Holder Category
Exporters who reach a superior export performance level as specified under Para 1.26 of the Foreign Trade Policy (FTP) can upgrade their status holder classification. For example, an existing firm holding a One Star Export House certificate and meeting the threshold of exports of USD 15 million or more (calculated on FOB/FOR value during the last and the immediately preceding three financial years) can apply for the classification of Two Star Export House.
To upgrade, the exporter will have to:
Surrender the existing certificate, and
Make a fresh application to the Regional Authority (RA) of DGFT under Para 1.08 of the FTP, furnishing:
- Certified export performance information,
- Evidence of realization through e-BRCs, and
- Other documents as may be prescribed by DGFT.
The upgraded Status Holder Certificate will be operative for five years from the date of application for recognition, as per Para 1.09(b) of the FTP.
Why is it Important for an Export House of India?
The certificate is not just a statutory recognition for an export house of India. It gives:
- Confidence among foreign customers who recognize the exporter as certified by the Government of India.
- Seamless supply chain operations owing to expediting customs process.
- Future growth prospects by tapping into more international markets.
- Improved brand reputation of being a certified star export house.
The Status Holder Certification thus becomes a tactical advantage for all export houses in India.
How SKMC Global Can Help?
At SKMC Global, we are experts at helping businesses navigate the complex procedures of compliance with DGFT and FTP. Here's how we can help exporters who want to become a star export house:
1. Eligibility Check – We check export performance to ascertain eligibility for different classes of star export houses.
2. Application Support – Preparation of ANF 1B applications and preparing export data for status holder exporter recognition.
3. Compliance Guidance – Securing records and processes in accordance with DGFT to ensure the continuity of certificate validity.
4. Appeals & Upgradation – Support in case of appeals if the certificate is not granted and facilitation of upgrade to higher grades like three-star export house or higher.
5. Post-Certification Benefits – Facilitating clients in using privileges like self-certification, export warehousing, and financial concessions.
Conclusion
One of the strongest tools that exist under the Foreign Trade Policy of India is the Status Holder Certificate. It rewards exporters not only for their commercial success but also for their role in the nation's trade framework. Star export house recognition enhances credibility, simplifies operations barriers, and generates international business possibilities.
For each of India's export houses that wish to expand, this certification is both a badge of distinction and a passport to the world. With skilled partners such as SKMC Global, securing and sustaining this certification is an effortless exercise, allowing exporters to concentrate on their main business – spreading India's influence in international trade.
FREQUENTLY ASKED QUESTIONS
The export performance of at least USD 3 million in the current as well as the last three financial years is mandatory.
FTP 2023 certificates are valid for five years.
Goods, services, and technology exporters can become status holder exporters.
Quicker clearances, relief from bank guarantees, preferential treatment, and self-certification of origin.
Certificates could be suspended or revoked for fraud, misrepresentation, or non-compliance.
Yes. Exporters crossing higher thresholds can surrender the old certificate and obtain an upgraded category.
A newly registered exporter cannot apply immediately unless it fulfills the required minimum export performance as specified. Nevertheless, rapidly growing firms with high-value contracts can achieve eligibility within a shorter period.
Yes. Supplies classified as Deemed Exports (e.g., supplies to EOUs, SEZs, or advance authorization holders) qualify for considering export performance for Status Holder recognition.
RA of DGFT processes and issues the certificate on the basis of export turnover, shipping bills certified, e-BRCs (Bank Realization Certificates), and other documents.
Yes. Status Holder recognition does not limit exporters from availing themselves of incentives under RoDTEP, RoSCTL, EPCG, Advance Authorization, and SEIS/SEZ schemes, subject to scheme-specific requirements.
Yes. Status Holders receive priority and streamlined processes in getting import authorizations and benefit from preferential treatment under schemes such as EPCG and Advance Authorization.