HS Code Guide · EPM Subvention
HS Code 420310 Meaning — Apparel of leather/composition leather: Global Trade, India & Factoring Guide
HS 420310 covers apparel of leather/composition leather. 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 420310 sits in 42 — Leather & articles of leather. Official tariff description: “Apparel; articles of apparel, of leather or of composition leather” In plain terms, it covers apparel of leather/composition leather. 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 420310?
HS 420310 covers leather apparel — jackets, coats, trousers, etc., of leather or composition leather vs textile apparel (61/62).
Official description: Apparel; articles of apparel, of leather or of composition leather
What HS 420310 does in trade
- Separates leather jackets/garments from textile — duty and factoring risk differ.
- Is eligible — leather apparel is in the positive list, so factoring qualifies for 2.75%.
- Captures a premium MSME export with 60–120 day terms to EU/US.
Global perspective — where HS 420310 moves
Global leather apparel trade is fashion/seasonal, Italy-led luxury. China and India are volume suppliers.
| Top global exporters | Top global importers |
|---|---|
| Italy | United States |
| China | Germany |
| India | France |
| Pakistan | United Kingdom |
| Turkey | China |
India's stance on HS 420310
India (Kanpur, Delhi, Chennai) is a top-5 leather apparel exporter — CLE. US/Germany/France are buyers; made-to-order drives terms.
Export docs to watch
Leather apparel needs CLE RCMC and for EU REACH.
GIFT City — factoring HS 420310 in foreign currency
Leather apparel is EUR/USD — 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 420310 eligible for 2.75%?
Yes — HS 420310 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 420310 |
|---|---|
| In positive list (HS-6) | Yes — 420310 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. 42031010) starts with 420310, it inherits this eligibility. Verify on the HS checker — enter 6 or 8 digits.
Check HS 420310 — 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 420310 — Apparel of leather/composition leather?
HS 420310 covers leather apparel — jackets, coats, trousers, etc., of leather or composition leather vs textile apparel (61/62).
Is HS 420310 eligible for the 2.75% interest subvention?
Yes. HS 420310 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 420310 and how?
MSMEs (as defined by Ministry of MSME) with active IEC and Udyam, factoring eligible exports of HS 420310 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 420310 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 420310 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 420310 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.