EXIM POLICY or INDIAN FOREIGN TRADE POLICY

What is EXIM policy ?

EXIM policy refers to the policy measures adopted by a country with reference to its exports and
imports and is regulated by the Foreign Trade Development and Regulation Act, 1992.
The policies enacted by Government of India and the present set of policies are valid for 2009-2014.
What is the objective of the FTDR Act
The main objective of the Foreign Trade (Development and Regulation) Act is to provide the
development and regulation of foreign trade by facilitating imports into, and augmenting exports
from India.
What are the objectives of EXIM Policy ?
There are two Broadaspects of Exim Policy;

Controlling import of non-essential items and

at the same time, all-out efforts are made to promote exports.

Thus, the import policy which is concerned with regulation and management of imports and the
export policy which is concerned with exports not only promotion but also regulation.
The main objectives are :

To facilitate sustained growth in exports.

To provide domestic consumers with good quality goods and services at internationally
competitive prices
Creating a level playing field for the domestic producers with International markets.
To stimulate sustained economic growth by providing access to essential raw materials,
intermediates, components, consumables and capital goods required for augmenting
production and providing services.
To enhance the technological strength and efficiency of Indian agriculture, industry and
services, (thereby improving their competitiveness to meet the requirements of the global
markets.)
To generate new employment opportunities and to encourage the attainment of
internationally accepted standards of quality.

Features of EXIM Policy of 2009-2014

General Provisions affecting the following: ( You can see the range of aspects it is covering to
control export and imports)
o Exports and Imports shall be free, except where regulated by Foreign Trade Policy
or any other law in force
o Every exporter or importer shall comply with the provisions of FT (D&R) Act
o DGFT ( Director General of Foreign Trade) may, specify procedure to be followed for
an exporter or importer for purpose of implementing provisions of FT (D&R) Act

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DGFT may give orders for any exemption from policy or procedures.
Any goods, export or import of which is restricted under policy may be exported or
imported only in accordance with an issued in this regard.
No export or import shall be made by any person without an Code (IEC) Number
(Import Export Code number)

IMPORTS (Only few of them is given below to the extent relevant for exams)
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Passenger Personal Baggage rules for getting house hold good s and personal
effects while coming in to the county
Import of gifts shall be permitted where such goods are otherwise freely importable
under Foreign Trade Policy (FTP)
All second hand goods, except second hand capital goods, shall be restricted for
imports, unless specifically authorised
Import of samples shall be governed by rules
Sale of goods on high seas for import into India may be made subject to FTP or any
other law in force. (High Sea sales (HSS) are a sale carried out by the carrier
document consignee to another buyer while the goods are yet on high seas or after
their dispatch from the port/ airport of origin and before their arrival at the port /
airport of destination.)

EXPORTS (Only few of them is given below to the extent relevant for exams)
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All goods may be exported without any restriction except to extent such exports are
specifically regulated
Goods, including edible items, of value not exceeding Rs.5,00,000 /- in a licensing
year, may be exported as a gift. However, items mentioned as restricted for exports
shall not be exported as a gift
defective / damaged or otherwise unfit for use may be replaced free of charge by
the exporter and such goods shall be allowed clearance by Customs authorities
Defective exported goods may be imported for repair and re-export without any
authorisation
All export proceeds (payments) shall be realised in freely convertible currency.
If an exporter fails to realise export proceeds within time specified by RBI, he shall
be liable to action
Consignments of items meant for exports shall not be withheld / delayed for any
reason by any agency of Central / State Government.
No seizure of stock shall be made by any agency so as to disrupt manufacturing
activity and delivery schedule of exports.

Other Measures Covered:

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Setting up of Export Promotion Councils for each type of products, projects and
services mentioned
Any person, applying for: (i) an Authorisation to import / export, or (ii) any other
benefit or concession under FTP shall be required to furnish RCMC ( registration cum

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membership certificate ) granted by competent authority in accordance with

procedure specified
Government shall work towards greater simplification, standardization and
harmonization of trade documents using international best practices
With a view to promote use of Information Technology, DGFT will provide fiscal
incentives to user community. ( to promote computerisation amongst exporters and
importers)
Easing of Documentation Requirement

Promotional Measures
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Served From India SchemeObjective is to accelerate growth in export of

services so as to create a powerful and unique Served From India brand, instantly
recognized and respected world over. 10% of export value given as Duty credit
scrip to import.
VISHESH KRISHI AND GRAM UDYOG YOJANA (VKGUY)- to promote agri and gram
udyog products. Incentive is Duty credit scrip to import.
FOCUS Market Scheme: Objective is to offset high freight cost and other
externalities to select international markets with a view to enhance Indias export
competitiveness in these countries. Incentive : Duty credit scrip to import
FOCUS Product scheme: Objective is to incentivise export of such products which
have high export intensity / employment potential, so as to offset infrastructure
inefficiencies and other associated costs involved in marketing of these products.
Incentive Given: Duty credit scrip to import
Duty exemption schemes : To enable duty free import of inputs required for export
production
An Advance Authorisation Scheme is issued to allow duty free import of inputs,
which are physically incorporated in export product
DUTY FREE IMPORT AUTHORISATION (DFIA) SCHEME DFIA is issued to allow duty
free import of inputs, fuel, oil, energy sources, catalyst which are required for
production of export product
DUTY ENTITLEMENT PASSBOOK (DEPB) SCHEME : Objective of DEPB is to neutralise
incidence of customs Passbook (DEPB) duty on import content of export product
Scheme For GEM and Jewellary: Exporters of gems and Jewellery can import /
procure duty free inputs for manufacturing.
EXPORT PROMOTION CAPITAL GOODS (EPCG) SCHEME; Zero duty EPCG scheme
allows import of capital goods for pre production, production and post production.
SETTING UP OF EXPORT ORIENTED UNITS (EOUs), ELECTRONICS HARDWARE
TECHNOLOGY PARKS (EHTPs), SOFTWARE TECHNOLOGY PARKS (STPs) AND BIOTECHNOLOGY PARKS (BTPs).
SPECIAL ECONOMIC ZONES- treated as foreign territory within the country and
import and export rules are not applicable, when the produced goods and services
are exported. But goods coming out of these zones in the country will be treated as
imports and such rules will apply.