Paragraph 2 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Paragraph 2.07 says the DGFT may, through a Notification, impose a prohibition or a restriction on imports or exports, and lists seventeen purposes, clauses (a) to (q), for which it may do so. The paragraph does not itself restrict any item. It states the grounds; the item-wise position is in the ITC(HS) Schedules and the Notifications that amend them.
This article is based on the chapter-wise text of the Foreign Trade Policy, 2023 published on the DGFT website, as consulted on 2 October 2026; the copy carries no "updated up to" date. Later Notifications, Public Notices and Trade Notices should be checked before you act. No item is named in this article as restricted or prohibited; check the item's entry in ITC(HS). If you need an import or export authorisation for a regulated item, our restricted items import and export licence service can take the matter up.
The DGFT may, through a Notification, impose a prohibition or restriction on one or more of the purposes listed in clauses (a) to (q) of paragraph 2.07: shortage, standards, domestic production, external position and reserves, industry establishment, serious injury, public morals and order, life and health, gold and silver, compliance with laws, prison labour, national treasures, natural resources, domestic processing, short supply, essential security interests and United Nations obligations. The paragraph itself names no section; the Act's related powers are in sections 3 and 9A.
What the Policy says
The power and its source
Paragraph 2.07 is headed "Principles of Restrictions". It begins: "DGFT may, through a Notification, impose 'Prohibition' or 'Restriction'" and then lists the purposes. The Act gives the Central Government the power to prohibit, restrict or regulate imports and exports and to make provisions for quantitative restrictions on imports; see our articles on sections 3 and 4 of the Foreign Trade (Development and Regulation) Act, 1992 and section 9A of the Act. The Policy itself is made under section 5 of the Act. For the Customs Act's separate power over prohibited goods, see section 11 of the Customs Act, 1962.
The seventeen purposes, one line each
| Clause | Purpose for which a prohibition or restriction may be imposed |
|---|---|
| (a) | On export of foodstuffs or other essential products, to prevent or relieve critical shortages |
| (b) | On imports and exports necessary to apply standards or regulations for classification, grading or marketing of commodities in international trade |
| (c) | On imports of fisheries products, in any form, to enforce governmental measures that restrict production of the domestic product, or for certain other purposes |
| (d) | On imports, to safeguard the country's external position and ensure a level of reserves |
| (e) | On imports, to promote establishment of a particular industry |
| (f) | To prevent sudden increases in imports from causing serious injury to domestic producers, or to relieve producers who have suffered such injury |
| (g) | For protection of public morals or to maintain public order |
| (h) | For protection of human, animal or plant life or health |
| (i) | Relating to the importation or exportation of gold or silver |
| (j) | Necessary to secure compliance with laws and regulations, including those on protection of patents, trademarks and copyrights and prevention of deceptive practices |
| (k) | Relating to products of prison labour |
| (l) | For protection of national treasures of artistic, historic or archaeological value |
| (m) | For conservation of exhaustible natural resources |
| (n) | For ensuring essential quantities for the domestic processing industry |
| (o) | Essential to the acquisition or distribution of products in general or local short supply |
| (p) | For protection of the country's essential security interests: (i) relating to fissionable materials or the materials from which they are derived; (ii) relating to the traffic in arms, ammunition and implements of war; (iii) taken in time of war or other emergency in international relations |
| (q) | In pursuance of the country's obligations under the United Nations Charter for the maintenance of international peace and security |
How the grounds group together
- Supply and prices: clauses (a), (n) and (o) deal with shortages, essential quantities for processing industry, and goods in general or local short supply.
- Trade management: clause (b) on standards for classification and grading; clause (d) on external position and reserves; clause (e) on establishing an industry; clause (f) on sudden surges and serious injury; clause (c) on fisheries.
- Social and health grounds: clauses (g), (h), (k), (l) and (m).
- Metals and compliance: clause (i) on gold or silver and clause (j) on compliance with laws, including intellectual property.
- Security and international obligations: clauses (p) and (q).
The paragraph is silent on whether a Notification must name the clause it relies on.
What happens after a restriction is imposed
Paragraph 2.07 stops at the grounds. What follows is in the neighbouring paragraphs: under paragraph 2.08, goods or services whose export or import is restricted may be exported or imported only in accordance with an authorisation or permission, or the procedure prescribed in a Notification or Public Notice; paragraph 2.09 deals with the actual user condition; paragraph 1.05(b) deals with the date of the policy change. They are explained in our articles on paragraphs 2.08 and 2.09 and paragraphs 1.00 to 1.05.
A practical example
Pearl Basin Foods, an invented importer, reads in a Notification that imports of a certain commodity have become restricted. The Notification does not give its reasons in the words of paragraph 2.07; it may refer to protection of plant life or health, which is clause (h). The paragraph helps the reader in two ways: it shows the range of reasons a restriction may rest on, and it shows that a restriction is imposed by a Notification and not by the Policy text alone. What Pearl Basin needs next is the entry in ITC(HS) for its item and the Notification itself, to learn whether an authorisation is required, and what its pending contracts may do under paragraph 1.05(b).
Need help with a restricted item?
Whether an item is restricted, and how to obtain the authorisation, depends on its current Notification and entry. If your shipment may fall within one of these grounds, our team can help you with a restricted items import and export licence and the supporting file.
Key takeaways
- A prohibition or restriction is imposed by DGFT Notification, on the purposes in paragraph 2.07(a) to (q).
- The purposes range from shortages and standards to security and United Nations obligations.
- The paragraph is a list of grounds; it does not itself restrict any item.
- Restricted goods move only under an authorisation or the notified procedure (paragraph 2.08).
- Check the ITC(HS) entry and the current Notification for the item.
Read next
- Paragraphs 2.08 and 2.09: restricted goods and the actual user condition
- Paragraph 2.06: mandatory documents for export and import
- Section 9A of the Foreign Trade (Development and Regulation) Act, 1992: quantitative restrictions on imports
- Section 11 of the Customs Act, 1962: power to prohibit import or export of goods
Disclaimer: Based on the chapter-wise text of the Foreign Trade Policy, 2023 and the Handbook of Procedures, 2023 published on the DGFT website, and on the later Notifications named in this article, as consulted on 2 October 2026. The copies carry no "updated up to" date. Notifications, Public Notices, Trade Notices, the ITC(HS) schedules, Appendices and forms change often; the current text on the DGFT website should be checked before acting. This article is general information, not legal advice; check the official text before acting.