HS Code Guide · EPM Subvention
HS Code 120740 Meaning — Sesamum seeds: Global Trade, India & Factoring Guide
HS 120740 covers sesamum seeds. This guide explains what the code includes, its global trade, India's position, how GIFT City helps factor it, and whether MSME factoring qualifies for the 2.75% interest subvention.
What this HS code covers
HS 120740 sits in 12 — Oil seeds & oleaginous fruits. Official tariff description: “Oil seeds; sesamum seeds, whether or not broken” In plain terms, it covers sesamum seeds. Classification decides duty and documents; this 6-digit line is in the DGFT positive list (Trade Notice 25/2025-26 Annex V), so MSME factoring under it qualifies for the 2.75% subvention — details below.
What is HS 120740?
HS 120740 covers sesamum (til) seeds — raw, whether broken or not. Roasted/sesame oil is separate.
Official description: Oil seeds; sesamum seeds, whether or not broken
What HS 120740 does in trade
- Classifies raw sesame where variety (white, black, hulled) drives price — distinct from mustard (120750) and groundnuts.
- Is eligible — sesamum is in the positive list, so factoring qualifies for 2.75%.
- Enables factoring for a storable oilseed with 30–60 day terms to hullers.
Global perspective — where HS 120740 moves
World sesame trade ~1.5 MT, Africa and Asia supply. India, Sudan and Myanmar are origins; China, Japan and Turkey are hullers.
| Top global exporters | Top global importers |
|---|---|
| India | China |
| Sudan | Japan |
| Myanmar | Turkey |
| Tanzania | South Korea |
| Nigeria | Greece |
India's stance on HS 120740
India is #1 sesamum exporter — Gujarat, Rajasthan, UP hubs. IOPEPC/Shellac & sesame council. Exports go to China/Japan/Turkey; hulled sesame is value-added.
Export docs to watch
Sesamum needs IOPEPC RCMC, phytosanitary and for EU/Japan pesticide compliance.
GIFT City — factoring HS 120740 in foreign currency
Sesamum is USD to East Asia — GIFT City FC factoring retains 2.75%.
Trad can route eligible invoices via an IFSCA-regulated IBU or Finance Company/Finance Unit undertaking factoring in GIFT City. The 2.75% subvention is identical whether you factor via India (RBI-regulated) or GIFT City (IFSCA-regulated) — the choice is about currency, banking relationship and buyer location, not the benefit rate.
Common financing stack for this HS
Factoring advances 70–90% in 24–48 hours after invoice verification; balance minus discount/fees on buyer payment. Works alongside packing credit — factoring covers the post-shipment open-account gap.
MSME subvention — is HS 120740 eligible for 2.75%?
Yes — HS 120740 is in the positive list (Trade Notice 25/2025-26 Annex V). MSMEs involved in international value chains with a valid active IEC (not in DEL) and valid Udyam can claim 2.75% per annum on the factoring interest cost element when factoring via an RBI/IFSCA-regulated entity.
| Check | For HS 120740 |
|---|---|
| In positive list (HS-6) | Yes — 120740 listed in Annex V |
| Benefit | 2.75% p.a. on interest cost element |
| Annual cap | ₹50 lakh per MSME per FY |
| Valid from | Prospectively from 20 Feb 2026 |
| Need UIN per factor? | Yes — declaration of intent before factoring, valid till FY-end |
| Eligible factors | RBI-regulated (AD bank / factoring NBFC) or IFSCA-regulated (GIFT IBU/FC) |
| Not covered | Deemed exports (FTP Ch.7) & exports to SEZs |
Eight-digit HS? Use first 6 digits
Eligibility is at HS-6. If your 8-digit HS (e.g. 12074010) starts with 120740, it inherits this eligibility. Verify on the HS checker — enter 6 or 8 digits.
Check HS 120740 — free
Verify any 6 or 8-digit HS against the DGFT positive list and see the 2.75% factoring eligibility in seconds.
Open HS checkerFrequently asked questions
What is HS 120740 — Sesamum seeds?
HS 120740 covers sesamum (til) seeds — raw, whether broken or not. Roasted/sesame oil is separate.
Is HS 120740 eligible for the 2.75% interest subvention?
Yes. HS 120740 is in the DGFT positive list (Trade Notice 25/2025-26 Annex V, 4139 HS-6 lines). MSMEs factoring exports under this line via RBI/IFSCA-regulated factors can claim 2.75% per annum on the interest cost element, capped at ₹50 lakh per MSME per year, prospectively from 20 Feb 2026. Requires valid IEC (not in DEL), valid Udyam, and a UIN per factor obtained before factoring.
Who can claim the 2.75% for HS 120740 and how?
MSMEs (as defined by Ministry of MSME) with active IEC and Udyam, factoring eligible exports of HS 120740 via RBI/IFSCA-regulated entities. File a declaration of intent on the DGFT portal to get a UIN per factor (valid till FY-end), factor the invoice, the factor files monthly IEC-wise claims; subvention is credited to your IEC-linked bank account.
Can HS 120740 be factored via GIFT City?
Yes. IBUs and Finance Companies/Finance Units undertaking factoring in GIFT City (IFSCA-regulated) are eligible financial institutions under IFSCA circular 19 Mar 2026 and must extend the 2.75% benefit. Useful for USD/EUR receivables where you want foreign-currency factoring.
What does factoring for HS 120740 cost after subvention?
Indicatively, factoring discount/interest is priced commercially (often 8–12% p.a. depending on buyer, tenor, currency) plus factoring fee ~0.5–3% ⚠️. The 2.75% offsets only the interest element — e.g. a 9% interest cost becomes ~6.25% effective on that element if eligible. Fees/insurance/FX remain. Compare all-in cost.
Related HS codes
Compare HS 120740 with other MSME-export lines in the same chapter or family.
See all codes on the HS code guides hub, or read the 2.75% subvention deep-dive.