The Department of Commerce is an institution, specifically one of the two administrative departments under the Union Ministry of Commerce and Industry (MCI) of the Government of India. Its primary mandate is the regulation and development of India's international trade and commerce.
The Ministry of Commerce and Industry, which houses the Department, was re-created on October 13, 1999, under Prime Minister Atal Bihari Vajpayee, by merging the previously separate Ministries of Commerce and Industry. This structure was established to manage the flow of goods and services and promote economic growth through trade and industry development. The Department of Commerce itself has historical roots in a department established in 1905 under the British Raj.
The Department's core mechanism is the formulation, implementation, and monitoring of the Foreign Trade Policy (FTP), which outlines strategies for promoting exports and trade. It works by managing multilateral and bilateral commercial relations, overseeing state trading, and implementing export promotion measures. The Department is functionally divided into eight divisions and is responsible for the development and regulation of certain export-oriented industries and commodities.
It connects directly to its sister department, the Department for Promotion of Industry and Internal Trade (DPIIT), and the Directorate General of Foreign Trade (DGFT), which is the implementing agency for the FTP. Key legislation it implements includes the Foreign Trade (Development and Regulation) Act, 1992, and the Special Economic Zones Act, 2005.
A recent change involves the insertion of the Inventory-based Cross-border E-Commerce Facilitation Framework into the Foreign Trade Policy, 2023. This framework, operationalized by the DGFT on August 5, 2026, permits foreign-funded e-commerce entities to use an inventory-based model exclusively for exporting goods manufactured or produced in India, while the restriction on inventory-based models for domestic B2C sales remains unchanged.