Context: Recently, Centre has notified norms for import of 5 lakh tonnes of maize under Tariff Rate Quota Scheme during the current financial year at a concessional customs duty of 15 per cent.
About the Scheme

• Under the scheme, the government allows import of four products such as maize (corn), milk and cream in powder, granules, crude sunflower seed or safflower oil and fractions thereof; and refined rape, colza or mustard oil and fractions thereof at concessional rates of customs duty.

Tariff Rate Quota (TRQ)

• It is a mechanism that allows a set quantity of specific products to be imported at a low or zero rate of duty.
• They are established under trade agreements between countries.
• The TRQ commitment does not apply any limits on the quantity of import of a product.
• Instead, it applies a higher rate of duty for that specific product once imports up to the TRQ commitment have been reached.
• TRQ is a two-tiered tariff instrument.
• Imports entering within the quota portion of a TRQ are subject to a lower tariff rate called the tariff quota rate.
• The later imports (above the quota) face a much higher tariff rate, which is normally the MFN (Most Favored Nation) tariff.
• MFN tariffs are what countries promise to impose uniformly on imports from other members of the WTO.