4 of the Foreign 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.
Section 3 lets the Central Government make Orders that develop foreign trade or prohibit, restrict and otherwise regulate imports and exports. Section 4 kept alive the Orders made under the older 1947 Act. This article explains both as per the Act as enacted in 1992 read with the 2010 Amendment Act.
The Central Government may, by Order published in the Official Gazette, facilitate trade or prohibit, restrict or otherwise regulate the import or export of goods, services or technology. Goods covered by such an Order are deemed prohibited under section 11 of the Customs Act, 1962. Since 2010 section 3(4) adds that no permit or licence is needed, and nothing is prohibited, except as this Act, its rules or Orders require. Section 4 continued earlier Orders unless inconsistent with the Act.
Section 3(1): Orders to develop and regulate trade
Section 3(1) says the Central Government may, by Order published in the Official Gazette, "make provision for the development and regulation of foreign trade by facilitating imports and increasing exports". This is the enabling clause for Orders that support trade. It is unchanged since 1992.
An "Order" is defined in section 2(h) as an Order made under section 3.
Section 3(2): prohibit, restrict, regulate
Section 3(2) allows the Central Government, also by Order published in the Official Gazette, to make provision "for prohibiting, restricting or otherwise regulating, in all cases or in specified classes of cases and subject to such exceptions, if any, as may be made by or under the Order, the import or export of goods". The 2010 Act replaced "goods" with "goods or services or technology".
Three features stand out:
- The power covers prohibition, restriction and "otherwise regulating", so an Order need not ban an item; it may attach conditions.
- It can operate in all cases or in specified classes.
- It can carry exceptions, which may be made by or under the Order.
The 2010 proviso for services and technology
The 2010 Act added a proviso to section 3(2): the sub-section applies, for import or export of services or technology, "only when the service or technology provider is availing benefits under the foreign trade policy or is dealing with specified services or specified technologies". For goods there is no such limit. The terms are defined in section 2; see our article on services, technology and specified goods.
If you are unsure whether the goods or services you plan to trade fall within a restriction, a restricted items import-export licence review is the practical place to start.
Section 3(3): the link to the Customs Act, 1962
Section 3(3) says all goods to which any Order under sub-section (2) applies "shall be deemed to be goods the import or export of which has been prohibited under section 11 of the Customs Act, 1962 and all the provisions of that Act shall have effect accordingly". In plain terms, a restriction in a foreign trade Order is enforced at the border through the Customs Act. Section 11 and the other provisions of that Act are not explained here; the reader should check the current law for them. Example: Rohan Agro Exports plans to ship a commodity that a section 3(2) Order restricts. Without the required permission, the goods are treated as prohibited goods under the Customs Act, so the shipment can be stopped at the port and the consequences of that Act can follow. The Foreign Trade Act has its own penalty route as well, discussed in section 11.
Section 3(4): added in 2010
Sub-section (4) reads (the first word is printed with a small "without"): "without prejudice to anything contained in any other law, rule, regulation, notification or order, no permit or licence shall be necessary for import or export of any goods, nor any goods shall be prohibited for import or export except, as may be required under this Act, or rules or orders made thereunder."
Reading it carefully:
- It states a general position for goods: no permit or licence and no prohibition, except as this Act, its rules or its Orders require.
- It is expressed to be "without prejudice" to other laws, rules, regulations, notifications or orders, so those instruments keep whatever requirements they impose in their own field.
- It mentions goods only; the printed text of sub-section (4) does not mention services or technology.
Section 4: existing Orders continue
Section 4 says all Orders made under the Imports and Exports (Control) Act, 1947 and in force immediately before the commencement of this Act "shall, so far as they are not inconsistent with the provisions of this Act, continue to be in force and shall be deemed to have been made under this Act". Section 4 was not changed in 2010. The repeal of the 1947 Act is in section 20, covered in our article on sections 1 and 20.
| Section | What it does | Changed in 2010? |
|---|---|---|
| 3(1) | Orders to facilitate imports and increase exports | No |
| 3(2) | Orders to prohibit, restrict or regulate | Yes: services and technology; proviso |
| 3(3) | Goods under an Order deemed prohibited under the Customs Act, 1962 | No |
| 3(4) | No permit or licence needed except as the Act requires | New |
| 4 | Earlier Orders continue if consistent | No |
Orders in practice: the Exemption Order
One Order made under sections 3 and 4 is the Foreign Trade (Exemption from application of Rules in certain cases) Order, 1993, restated in 2017. It lists cases where the Rules do not apply; see our article on the Order. The Foreign Trade Policy 2023 itself says that its amendments are made under sections 3 and 5 of the Act (FTP 2023, para 1.02, in the copy consulted); section 5 holds the policy power.
Need help with restricted goods?
If your goods may be prohibited or restricted, or an Order may affect a shipment, our restricted items import-export licence support can help you check the position. Later amendments to the Act, the Orders and the Foreign Trade Policy should be checked first.
Key takeaways
- Section 3 is the source of Orders: to facilitate trade, and to prohibit, restrict or regulate it.
- Since 2010 the power covers goods, services and technology, with a proviso for services and technology.
- Goods under a section 3(2) Order are deemed prohibited under section 11 of the Customs Act, 1962.
- Section 3(4) says no permit or licence is needed, and nothing is prohibited, except as the Act, rules or Orders require.
- Section 4 continued earlier Orders, so far as not inconsistent.
Read next
- Section 5: the foreign trade policy
- Section 9: licence, certificate, scrip and other instruments
- The Exemption Order, 1993: imports and exports outside the Rules
- Foreign Trade Policy 2023: key provisions
Disclaimer: Based on the Foreign Trade (Development and Regulation) Act, 1992 as enacted read with the Amendment Act of 2010, and on the Foreign Trade (Regulation) Rules, 1993 as notified read with the Amendment Rules of 2015, as consulted on 2 October 2026. Later amendments, the current Foreign Trade Policy and the Handbook of Procedures should be checked. This article is general information, not legal advice; check the official text before acting.