India has opened a new channel for cross-border online sales by allowing inventory-based e-commerce operations for exports, a shift designed to help domestic goods reach overseas buyers more efficiently. According to the government’s August 5 notifications, the framework sits under the Foreign Trade Policy 2023 and creates a dedicated export-only structure for e-commerce entities handling Indian products in foreign markets.
The change builds on an earlier policy amendment issued on July 23, when the Department for Promotion of Industry and Internal Trade revised foreign investment rules to permit foreign direct investment in the inventory-based e-commerce model, but only for exports of goods manufactured or produced in India. Indian business publications said the measure was intended to strengthen export capacity while leaving intact the ban on inventory-led e-commerce sales in the domestic market.
Under the new system, eligible e-commerce companies can operate through a registered Exporter-on-Record, or EOR, which buys products from Indian sellers against confirmed overseas orders and ships them under its own name. The EOR takes on the export paperwork, customs formalities, destination-country compliance, packaging, labeling, logistics and reverse logistics, reducing the operational burden on smaller Indian producers and sellers.
The government has also built in guardrails to prevent the export channel from being used as a backdoor for domestic trade. Inventory can be created only against confirmed export orders, it must be kept separately identifiable in a digital system, and the goods cannot be diverted into India’s home market. Returns, rejected shipments and export rebates are also subject to specific handling rules, while annual compliance certification is required to support traceability and oversight.
Officials say the framework should be especially useful for micro, small and medium-sized enterprises, artisans and manufacturers that want access to global marketplaces without having to build their own international logistics networks. Business publications reporting on the policy change said the model is meant to speed up payments, improve visibility over shipment status and final sale price, and make it easier for Indian sellers to plug into large overseas e-commerce ecosystems.
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