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IMPACT OF RECENT CHANGES IN FOREIGN TRADE POLICY

INTRODUCTION

India is known as one of the most important and emerging player in the
global economy. Its foreign trade policies and government reforms have made it a
significant destination for foreign investments around the world. Also,
technological and infrastructural developments being carried out all over the
country enable efficient trade and economic practices. For the successful economic
development of a country, vigorous foreign trade policy is of great importance.
Therefore, India adopted a foreign trade policy known as the EXIM Policy or the
Export-Import policy.

India's Foreign Trade Policy also known as Export Import Policy (EXIM)
in general, aims at developing export potential, improving export performance,
encouraging foreign trade and creating favorable balance of payments position.
Foreign Trade Policy is prepared and announced by the Central Government
(Ministry of Commerce). Foreign Trade Policy or EXIM Policy is a set of
guidelines and instructions established by the DGFT (Directorate General of
Foreign Trade) in matters related to the import and export of goods in India.
 
The foreign trade policy, has offered more incentives to exporters to help them
tide over the effects of a likely demand slump in their major markets such as the
US and Europe.
 
Foreign trade is exchange of capital, goods, and services across international
borders or territories. In most countries, it represents a significant share of gross
domestic product (GDP). While international trade has been present throughout
much of history, its economic, social, and political importance has been on the
rise in recent centuries.

The Foreign Trade Policy of India is guided by the Export Import in known as
in short EXIM Policy of the Indian Government and is regulated by the Foreign
Trade Development and Regulation Act, 1992.
 
DGFT (Directorate General of Foreign Trade) is the main governing body in
matters related to EXIM Policy. 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.
Foreign Trade Act has replaced the earlier law known as the imports and
Exports (Control) Act 1947.
 
Indian EXIM Policy contains various policy related decisions taken by the
government in the sphere of Foreign Trade, i.e., with respect to imports and
exports from the country and more especially export promotion measures,
policies and procedures related thereto.

The Foreign Trade Policy (FTP) was introduced by the Government to grow
the Indian export of goods and services, generating employment and increasing
value addition in the country. The Government, through the implementation of the
policy, seeks to develop the manufacturing and service sectors. This article is a
snapshot of the various aspects of the policy.

Primary Focus Areas


The Government, through the policy, primarily focuses on adopting a twin strategy
of promoting traditional and sunrise sectors of exports including services. Further,
it intends to simplify the process of doing business.

Duration of the Policy


The Foreign Trade Policy (FTP) was flagged off in the financial year of
2015-16, and will remain effective until the 31st of March, 2020. During this
period, all the exports and imports of the country will be governed by the policy.
The Government strives to make India a significant partner in global trade by
2020.

Foreign Trade Policy in India


The current Foreign Trade Policy is for the period 2015 – 2020 announced
by the Government of India, Ministry of Commerce and Industry on 01st April
2015. Foreign trade policy needs amendments every five years and aims at
developing export capability, improving export performance and structure,
encouraging foreign trade, and creating a suitable balance of payments position. It
is updated every year on the 31st of March, and the modifications, improvements
and new schemes become effective from 1st April each year.
India in 1991, after liberalization, totally lifted all sorts of restrictions from trade
for the purpose of improvement in the balance of payment position. A strong need
was felt for Indian markets to work globally, and the economy was set free. But in
a developing economy, it is not possible to develop industries without the
protection of policies. Therefore, later, it was necessary for India to impose a
restriction on its economy through trade policies to regulate import and export.

Objectives of the Foreign Trade Policy in India


Trade enables economic growth and national development. The main aim is not the
mere earning of foreign exchange, but encouraging greater economic activity. The
foreign trade policy of India is based on the following major objectives as follows:

1. To enable substantial growth in exports from India and import to India to


boost the economy.
2. To at least double the percentage share of global merchandise trade
conducted within the next five years.
3. To improve the balance of payment and trade.
4. To act as an effective instrument of economic growth by creating
employment opportunities for the citizens; the larger the expansion of trade
activities, the more the workforce required.
5. To provide for sustainable growth by giving access to essential raw materials
for production and other components, consumables and capital goods required for
increasing production and providing efficient services.
6. To raise the technological capacity for production and cost-effectiveness of
industry and services, thereby improving their competitive strength in comparison
to other countries, and to encourage the accomplishment of internationally
accepted standards of quality.
7. To provide buyers or clients with high-quality goods and services at globally
competitive rates and quality. ‘Canalization’- an important feature of Foreign
Trade Policy under which specific class of goods can be imported only by
designated agencies.
8. Creation of opportunities by engaging in good and ethical practices.
9. Accelerating the economy from low-level economic activities to high-level
economic activities by making it a globally oriented and vibrant economy
10. To derive maximum benefits from expanding the global market and seizing
the best opportunities available.
11. Making policies that favor ease of doing business and e-governance.
12. To allow for hassle-free transactions for both import and export.
13. Reducing the interference between the exporters and Directorate General of
Foreign Trade by reducing the number of export documents.
14. To allow the import of technology and equipment’s which may help in
achieving better international standards of quality and reduce the cost of
production.
15. Establishing the Advance Licensing System for imported goods needed for
manufacturing various goods for export. An Advance License is issued by the
Directorate General of Foreign Trade to allow duty-free import of inputs, which
are physically integrated with the export product (making normal allowance for
wastage).
16. To allow the import of certain goods as listed in the Open General License; a
kind of export license which is issued by Government to domestic suppliers.

Governing Policy – Institutions 


The Government of India notifies the foreign trade Policy for a period of five
years (for example 2015 -20) under Section 5 of the Foreign Trade
(Development and Regulation Act), 1992. The current Export Import Policy
covers the period 2015-2020. The FTP is updated every year on the 31st of
March and the modifications, improvements and new schemes become effective
from 1st April of every year.
All types of changes or modifications related to the EXIM Policy is normally
announced by the Union Minister of Commerce and Industry who co-ordinates
with the Ministry of Finance, the Directorate General of Foreign Trade and
network of DGFT Regional Offices.      
FTP 2015-2020

Some highlights of the present  Foreign Trade Policy 2015-2020

 India to be made a significant participant in world trade by 2020


 Commerce Minister announced two new schemes in Foreign Trade Policy
2015-2020Two New Schemes announced in FTP Are MEIS & SEIS. FTP
2015-20 introduces two new schemes, namely "Merchandise Exports from
India Scheme (MEIS)" and "Services Exports from India Scheme (SEIS)".
These schemes (MEIS and SEIS) replace multiple schemes earlier in place,
each with different conditions for eligibility and usage.
 Merchandize exports from India (MEIS) to promote specific services for
specific Markets Foreign Trade Policy
 For services, all schemes have been replaced by a 'Services Export from
India Scheme'(SEIS), which will benefit all services exporters in India.
 FTP would reduce export obligations by 25% and give boost to domestic
manufacturing
 Incentives (MEIS & SEIS) to be available for SEZs also. FTP benefits
from both MEIS & SEIS will be extended to units located in SEZs. – Both
MEIS and SEIS firms and service providers can now get 
 subsidized office spaces in SEZ (Special Economic Zones), along with other
benefits. With a view to boost the Special Economic Zones, Government has
decided to extend both the incentive schemes for export of goods and services
to units in SEZs.
 e-Commerce of handicrafts, handlooms, books etc., eligible for benefits of
MEIS. e-Commerce exports up to Rs.25000 per consignment will get SFIS
benefits.
 e-Commerce Exports Eligible For Services Exports From India Scheme. –
As part of Digital India vision, mobile apps would be created to ease filing of
taxes and stamp duty, automatic money transfer using Internet Banking have
been proposed. > Online procedure to upload digitally signed document by
Chartered Accountant/Company Secretary/Cost Accountant to be developed.
 Agricultural and village industry products to be supported across the globe at
rates of 3% and 5% under MEIS. Higher level of support to be provided to
processed and packaged agricultural and food items under MEIS.
 Industrial products to be supported in major markets at rates ranging from
2% to 3%.
 Branding campaigns planned to promote exports in sectors where India has
traditional Strength.
 Business services, hotel and restaurants to get rewards scrips under SEIS at
3% and other specified services at 5%.
 Duty credit scrips to be freely transferable and usable for payment of
customs duty, excise duty and service tax.
 Debits against scrips would be eligible for CENVAT credit or drawback
also.
 Nomenclature of Export House, Star Export House, Trading House, Premier
Trading House certificate changed to 1,2,3,4,5 Star Export House. – Some
major overhauling of nomenclature and naming have been done. For instance,
Export House, Star Export House, Trading House, Star Trading House,
Premier Trading House certificate has been changed to One, Two, Three,
Four, Five Star Export House. The allocation of the status will now be based
on US dollars, instead of Indian Rupees
 The criteria for export performance for recognition of status holder have
been changed from Rupees to US dollar earnings. – A new position called
‘Status Holder’ have been formulated, which will recognize and reward those
entrepreneurs who have helped India to become a major export player. All IT
and ITeS firms, Outsourcing companies and KPOs can rejoice.
 Manufacturers who are also status holders will be enabled to self-certify
their manufactured goods as originating from India. – Tax and duty on Indian
manufacturers have been reduced, to boost Make in India vision
 Reduced Export Obligation (EO) (75%) for domestic procurement under
EPCG scheme.
 Inter-ministerial consultations to be held online for issue of various licences.
 No need to repeatedly submit physical copies of documents available on
Exporter Importer Profile.
 Validity period of SCOMET export authorisation extended from present 12
months to 24 months.
 
Export obligation period for export items related to defence, military store,
aerospace and nuclear energy to be 24 months instead of 18 months
 Calicut Airport, Kerala and Arakonam ICDs(Inland Container Depots),
Tamil Nadu notified as registered ports for import and export.
 Vishakhapatnam and Bhimavarm added as Towns of Export Excellence.
 Certificate from independent chartered engineer for redemption of EPCG
authorisation no longer required.
 
Now let us understand how this achieves the desired objectives of the nation.
 

Impact on the Economy:


 
According to some experts the focus in this FTP has been “Simplicity And
Stability”. Accordingly, the policy on the one hand seeks to realign the multiple
schemes with the objective of reducing complexities. On the other had it want to
promote the increased use of technology to reduce the transaction cost and manual
compliances.
 
Supporters have given their verdict for this new FTP, stating it as ‘progressive’,
‘path breaking’ and ‘development friendly’ as exports of books, handicraft,
handlooms, toys, textiles, defence and ecommerce platforms would be easier and
faster.According to them, a big step is cleaning up the plethora of export promotion
schemes and clubbing them under two schemes, one for goods (Merchandise
Exports from India Scheme) and one for services (Services Exports from India
Scheme).The duty scrips under these schemes come without conditions and can be
freely transferred.
 
One significant announcement in the policy is that it will move away from relying
largely on subsidies and sops. Critics however point out that, this is prompted by
World Trade Organisation (WTO) requirements that export promotion subsidies
should be phased out, but according to some experts there are ways of getting
around it and other countries are doing it all the time.
 
There has been talk of boosting services exports for quite a few years now, but
information technology and information technology-enabled services (IT/ITES)
dominated the basket. The share of this segment in the overall export basket is 50
percent and 90 percent in the services export basket.
 
More importantly, this sector was overly dependent on western markets and,
consequently, extremely vulnerable to even the smallest of developments there.
The policy, fortunately, turns its attention to other sectors where India has inherent
advantages – healthcare, education, R&D, logistics, professional services,
entertainment, as well as services incidental to manufacturing.
 
By extending benefits under EPCG on domestic procurements and offering them
more products under MEIS, the policy further seeks to incentives the exports.
Right direction.
 
According to the Commerce Minister Nirmala Sitaraman, It's a focused policy, one
in which exports through Make in India is underlined by looking at sectors that
give greater employment and have high-tech value addition. That is because the
intention is to join the global value chain and above all, the environment part,
where you are looking at eco-friendly systems and producing wealth out of waste.
So, the priority areas are technology-driven, labour-intensive-driven and
environment-driven. You are also looking at traditional markets, emerging markets
and diversifying into new markets.
 

History of trade Policy of India


 
Even though the popular view is that India’s export promotion started with the
economic reforms post nineties. A study foreign trade policy shows that efforts
have been made to make our trade competitive even before that. To understand
this, we need to know the background history and evolution of foreign trade in
India.
 
India is looked upon as a country with immense resources available through its
length and breadth. India was famed for her fabulous wealth ever since the ancient
times till the establishment of the British Empire. Indian trade history reflects that
despite the frequent political upheavals during the 12th to the 16th centuries, the
country was still prosperous. Descriptions of the wide variety of excellent goods
sold in the Indian markets of those days are found in the records of foreign
travellers. India was well known for its textiles one of the chief items of export.
Textiles from Gujarat were sent to the Arab countries and to South-east Asia.
Trade history of India also shows hardwood furniture, embellished with inlay work
was a very popular item for expert. Although the expensive carvings and inlays
were inspired by the ornate Mughal style, the furniture was modelled on the
European design. Carpets were used both in ancient and medieval India. But the
skill of carpet weaving touched new heights during the 16th century. A larger
variety of ornamental work in cut stones, ivory, pearl and tortoise shells were
produced in South India. Pearl fishing was a major industry here. Indian arts and
crafts patronized by Indian rulers, were unmatched for their beauty and skill and
were very popular in the European countries. River routes also promoted trade
between different parts of the country. India’s exports were seen too far exceed her
imports both in the number of items as well as in volume. Arab traders shipped
Indian goods to European countries through the Red Sea and the Mediterranean
ports. With huge earnings from her exports of various commodities, the state
coffers were amply stocked with gold and silver.
 
India today stands as a trillion economy. Darjeeling tea, Indian khadi cotton, 
Kashmiri carpets, Indian spices and dry fruit are just a few of the famous gifts
India has given to the world. The economic levels have improved in the urban and
semi-urban areas. Literacy is penetrating deep in to even the far reach areas, thus
creating awareness and to higher consumption patterns for all kinds of goods
across all sections of the society. Promoting the availability of goods from different
parts of the world has seen a rise in more trade with other countries.
 
Indian trade history is remarkable. Indian trade has benefited and so has the world.
The country has realized that at the end of the day, maximizing use of one’s own
resources is what makes all the difference.
 
India’ Trade Policy Philosophy: Theoretical Background
 
On analytical grounds, trade policy can be broadly divided into two groups –
 Inward oriented and (b) Outward oriented.
 Inward – oriented policy:- An inward oriented strategy is the one in which
trade and industrial incentives are biased in favour of production for domestic
market over the export market. Thus, an inward oriented policy is often
designated as the import substitution strategy.
 Outward – oriented policy : - On the contrary, an outward oriented strategy
is the one in which trade and industrial policies do not discriminate between
production for domestic goods and foreign goods. Thus, an outward oriented
strategy is often designated as the export promotion strategy.
 
As remarked by World Bank in its World Development Report (1987) – “Inward –
oriented regimes are generally characterized by high levels of protection for
manufacturing, direct controls on imports and investments, and overvalued
exchange rates. By contrast, outward orientation links the domestic economy to the
world economy.”  The solution to the problem of BOP for a country depends on
the trade policy / export – import policy of the country. Hence, a systematic study
of BOP of a country should take into account the changes in the trade policy of a
country over a period of time.
 
Trade Policy Evolution 
In a broader sense, after independence for almost forty years or so India adopted
inward oriented strategy. The basic rationale behind it was that it would help rapid
industrialization through import substitution and at the same time save valuable
foreign exchange. This strategy covers the period from First Five Year Plan (1951
– 56) to the Seventh Five Year Plan (1985 – 90). This period is considered as the
period of “Licence – Quota Raj” wherein there was a controlled and restrictive
environment. However, the decade of 1990 is marked with a near U turn as India
adopted gradually a path of economic liberalization. It followed the policy of
Liberalization, Privatization and Globalization (LPG) to solve its BOP and related
problems. A series of economic reforms were introduced in various sectors to
tackle the BOP and other problems. Hence, the Indian economy which was a
closed economy for almost forty years now became relatively more open posing
challenges for macroeconomic management. Thus, from 1990 onwards India
adopted an outward oriented strategy which can be considered as a significant
turnaround from the earlier period. The adoption of outward oriented strategy was
a major departure from the relatively protectionist trade policies pursued in earlier
years.
There is no doubt that in the broader sense of the term India followed an inward -
oriented trade policy after independence till 1990. However, an in depth analysis of
India’s trade policy shows that there were certain shifts in policy stance from time
to time. Taking this into account trade policy of India can be broadly divided into
the following phases
 
Phase I – Import Restriction and Import Substitution (From 143 1950’s to 1970s),
Phase II – Export Promotion & Import Liberalisation (From 1970s to 1990s), and
Phase III – Outward Orientation – (From 1990 onwards).
 
Economic (Trade) Reforms in India:
In order to understand the evolution of the Foreign trade policy (EXIM policy)
over time we need to understand the larger framework and evolution of
Macroeconomic policy in India before and after the liberalisation in the 90’s. The
subsequent trade policies were developed keeping in view this larger framework
and in sequence to it.
 
In the early eighties, the Government of India appointed a special EXIM Policy
Committee to review the government previous export import policies. The
committee was later on approved by the Government of India. Mr. V. P. Singh, the
then Commerce Minister and announced the EXIM Policy on April, 1985. Initially
the EXIM Policy was introduced for the period of three years with main objective
to boost the export business in India
 
Now, let us understand the history and evolution of foreign trade policy in India we
need to understand it under different phases
 
Policy in Practice: Trends in Foreign Trade Policy
 
1950 -1990:
 
India entered into planned development era in 1950’s and at that time Import
Substitution was a major element of India’s trade and industrial policy. In 1950
India’s share in the total world trade was 1.78% which reduced to 0.6% in 1995.
During 2003-04 India’s share in the global trade was 0.8%, in 2005 it was 1.0%. 
 
The PC Alexander Committee (1978) was the first committee to review and
recommend on Import –Export Policies and Procedures. This committee
recommended the simplification of the Import Licensing procedure and provided a
framework involving a shift in the emphasis from “control to development”. In
1980 Tandon Committee gave recommendations on export strategies in eightees.In
the Export Import policy of 1978-79, for the first time in India’s History
decentralization of some licensing functions took place and the powers of regional
licensing authorities was enhanced.
 
Export Oriented Units were set up under the EOU scheme introduced in early
1981. The export and Import Bank of India (website) was set up in 1982 to take
over the operations of international finance wing of the IDBI. Other major
objectives was to provide financial assistance to exporters and importers.
 
In the Trade Policy of 1985-88 some measures were taken based upon the
recommendation of Abid Husain Committee 1984. This committee envisaged
“Growth Led Exports, rather than Export Led Growth”. The recommendation of
this committee stressed upon the need for harmonizing the foreign trade policies
with other domestic policies. This committee recommended announcement of
foreign trade policies for longer terms.
 
The export import pass book scheme was introduced in 1985 as per
recommendation of Abid Hussain Committee. In 1985 Vishvanath pratap Singh
Government developed a 3 year exim policy.Tax Reform Committee chaired by
Raja J Chelliah suggested minimizing the role of quantitative restrictions and
reducing the tariff rates substantially. Export Processing Zones were set up to push
up exports. They are now SEZ 

The Impact of Foreign Trade Policy 2015-2020


1. Introduction
Foreign Trade Policy or the FTP is the set of guidelines or the
procedures which are being formulated by the government to
incorporate in the economy and being followed so as to attain
maximum amount of Foreign Trade Foreign Trade Policy in India is
formulated by the Government of India, Ministry of Commerce and
Industry, Department of Commerce.
2. Importance Due to uneven distribution of natural resources, some
countries are more suitable place to produce some goods more
economically than other countries. Further the underdeveloped and
developing countries have to depend upon developed countries for
financial help, which ultimately encourages foreign trade. According
to the theory of comparative cost, each country should concentrate on
the production of those goods and/or services for which it is best
suited and specializes in the production of that goods and/or services,
thus there is a significant increase in the overall production with
minimized costs and resulting in higher standard of living of the
people. Foreign Trade Policy helps in increasing the revenue of a
nation by improving on the exports, which in turn help in improving
the Balance of Payment. Foreign Trade propels economic growth and
national development. The primary purpose is not the mere earning of
foreign exchange, but the stimulation of greater economic activity.
3. Scope & Objective With an aim to make India a significant partner in
global trade by 2020 and for increasing global competitiveness of
domestic products and aligning India’s tariff framework with the long
term commitment at World Trade Organisation, the government
formulated Foreign Trade Policy (FTP) for the term of 5 years
commencing from 2015. The new Policy (FTP 2015-20) is made product
wise and location wise and tried to maximize the foreign trade from the
country This policy aims at boosting India's exports and Central
Government’s pet projects, 'Make in India' and 'Digital India' is being
integrated with the new FTP 2015-20. The Policy (FTP 2015-20) of India
mainly focuses on an ambitious export target of 900 billion dollars by
year 2020 highlights a visible push to ‘Make in India‘. The foreign trade
policy of India is based on two major objectives, they are as follows: 1)
To double the percentage share of global merchandise trade within the
next five years. 2) To act as an effective instrument of economic growth
by giving a thrust to employment generation.
4. Schemes Under this Policy Two schemes namely; Merchandise
Exports from India Scheme (MEIS) and Services Exports from India
scheme (SEIS) were introduced under this policy.
These two schemes replace the gamut of old norms and reward for the
exporters on the basis of the importance attached to the exported items
and the targeted market. Objective of Merchandise Exports from India
Scheme (MEIS) is to offset infrastructural inefficiencies and associated
costs involved in export of goods/products, which are produced /
manufactured in India, especially those having high export intensity,
employment potential and thereby enhancing India’s export
competitiveness. The 'Services Exports from India Scheme' (SEIS) is for
increasing exports of notified services. Key Highlights & FEATURES
OF NEW FTP: The Policy spells out measures for increased
digitalization of exports and imports with the aim to gradually move
towards a paperless office in 24×7 environment and self-certification by
established exporters and importers. These schemes (MEIS and SEIS)
replace multiple schemes earlier in place, each with different conditions
for eligibility and usage. Incentives (MEIS & SEIS) are available for
SEZs also. E-Commerce of handicrafts, handlooms, books etc., eligible
for benefits of MEIS. SEIS shall apply to 'Service Providers located in
India' instead of 'Indian Service Providers'. The Government has
extended tax breaks to exporters of defense, pharma, farm produce and
environment-friendly products. The export obligation period for items
related to defense, military stores, aerospace and nuclear energy will be
24 months instead of 18 months. The policy has also reduced the exports
obligation for those procuring capital goods domestically to 4.5 times
imports as against six times under the export promotion of capital goods
scheme (EPCG), which will encourage the domestic capital goods
industry, according to analysts. This will help exporters develop
production capacities for both local and global consumption.
Manufacturers that are also status holders will be enabled to self certify
their manufactured goods as originating from India. Export of handloom
products, books & periodicals, leather footwear, toys and customized
fashion garments through courier or foreign post office for value up to
Rs. 25,000 would also be able to get benefit of Merchandise Exports
from India Scheme (MEIS) Duty credit scrips will be freely transferable
and usable to facilitate payment of custom duty, excise duty and / or
service tax. Debits against scrips would be eligible for CENVAT credit
or drawback also. Unlike annual reviews, FTP will be reviewed after
two-and-half years for its impact on business climate. Enhanced focus
will be placed on export of high value products to traditional market in
developing world. Similarly there will be strong emphasis to supply high
quality inputs for the manufacturing sector in these markets. Plus, the
custom duties applied on inputs for India’s manufacturing sector will be
fully optimized. The realignment of tariff structure will put India in
advantageous position in regional trade pacts being negotiated. So far
India was excluded from pacts such as the Trans-Pacifica Partnership
(TPP) partly because its tariffs are not competitive. The experts feel the
policy will benefit the exporting community, with special focus on
services exporters. Simplification of procedures will go a long way in
integrating India in the global value chain; improving India’s ranking in
ease of doing business index and reducing the transaction cost in
international trade. E-Commerce sector stands to gain from the FTP.
Intensive focus on higher value additions and technology infusion,
quality and standards will lead to zero defect products. Lower tariffs on
inputs and raw material will have a cascading impact on the economy.
Measures are adopted to nudge procurement of capital goods from
indigenous makers under the EPCG scheme by reducing specific export
obligation to seventy fifth i.e. 4.5 times imports as against six times of
the normal export obligation. This will promote the domestic capital
goods producing industry. These measures will create more employment
avenues in manufacturing and services. In order to provide a boost to
exports from Special Economic Zones (SEZs), Government has currently
decided to extend benefits of both the reward schemes (MEIS and SEIS)
to units situated in SEZs. Trade facilitation and enhancing the ease of
doing business are the other major focus areas in this new FTP. One of
the major objectives of new FTP is to move towards paperless working in
24×7 environment. Recently, the government has reduced the number of
necessary documents needed for exports and imports to three, which is
comparable with international benchmarks. Now, a facility has been
created to upload documents in exporter/importer profile and the
exporters won't be required to submit documents repeatedly. Government
has also simplified numerous Aayat Niryat Forms, bringing in clarity in
different provisions, removing ambiguities and enhancing electronic
governance. Manufacturers will currently be enabled to self certify their
factory-made goods in phases, as originating from India with a view to
qualifying for preferential treatment under numerous forms of bilateral
and regional trade agreements. This new System will help these
manufacturer exporters considerably in getting quick access to
international markets. A number of steps are introduced for encouraging
manufacturing and exports. The steps include a quick track clearance
facility for these units, permitting them to share infrastructure facilities,
allowing inter unit transfer of goods and services, permitting them to set
up warehouses near the port of export and to use duty free equipment for
training purposes. Nomenclature of Export House, Star Export House,
Trading House, Premier Trading House certificate changed to 1,2,3,4,5
Star Export House. The criteria for export performance for recognition of
status holder have been changed from Rupees to US dollar earnings.
Reduced Export Obligation (EO) (75%) for domestic procurement under
EPCG scheme. Online procedure to upload digitally signed document by
Chartered Accountant/Company Secretary/Cost Accountant to be
developed. Inter-ministerial consultations to be held online for issue of
various licenses. No need to repeatedly submit physical copies of
documents available on Exporter Importer Profile. Validity period of
SCOMET export authorization extended from present 12 months to 24
months. The government is pitching India as a friendly destination for
manufacturing and exporting goods, and the new policy is being seen as
an important step towards realizing that goal. Branding campaigns
planned to promote exports in sectors where India has traditional
Strength. Entitlement under MEIS: Exports of notified goods/products
with Indian Trade Clarification (Harmonized System) {ITC[HS]} code,
to notified markets as listed in Appendix 3B, shall be rewarded under
MEIS. Appendix 3B also lists the rate(s) of rewards on various notified
products [ITC (HS) code wise]. The basis of calculation of reward would
be on realized FOB value of exports in free foreign exchange, or on FOB
value of exports as given in the Shipping Bills in free foreign exchange,
whichever is less, unless otherwise specified. Export of goods through
courier or foreign post offices using e-Commerce 1) Exports of goods
through courier or foreign post office using e-commerce, as notified in
Appendix 3C, of FOB value up to Rs. 25000 per consignment shall be
entitled for rewards under MEIS. 2) If the value of exports using e-
commerce platform is more than Rs 25000 per consignment then MEIS
reward would be limited to FOB value of Rs.25000 only. 3) Such goods
can be exported in manual mode through Foreign Post Offices at New
Delhi, Mumbai and Chennai. 4) Export of such goods under Courier
Regulations shall be allowed manually on pilot basis through Airports at
Delhi, Mumbai and Chennai as per appropriate amendments in
regulations to be made by Department of Revenue. Department of
Revenue shall fast track the implementation of EDI mode at courier
terminals. The following exports categories /sectors shall be ineligible for
Duty Credit Scrip entitlement under MEIS, EXIM Policy 2015-20 (FTP
2015-20). 1) EOUs / EHTPs / BTPs/ STPs who are availing direct tax
benefits / exemption. 2) Supplies made from DTA units to SEZ units 3)
Export of imported goods covered under paragraph 2.46 of FTP; 4)
Exports through trans-shipment, meaning thereby exports that are
originating in third country but transshipped through India; Deemed
Exports; 5) SEZ/EOU/EHTP/BPT/FTWZ products exported through
DTA units; 6) Items, which are restricted or prohibited for export under
Schedule-2 of Export Policy in ITC (HS), unless specifically notified in
Appendix 3B. Service Export. 7) Red sanders and beach sand. 8) Export
products which are subject to Minimum export price or export duty. 9)
Diamond Gold, Silver, Platinum, other precious metal in any form
including plain and studded jewellery and other precious and semi-
precious stones. 10) Ores and concentrates of all types and in all
formations. 11) Cereals of all types. 12) Sugar of all types and all forms.
13) Crude/petroleum oil and crude/primary and base products of all types
and all formulations. 14) Export of milk and milk products. 15) Export of
Meat and Meat Products. 16) Products wherein precious metal/diamond
are used or Articles which are studded with precious stones. 17) Exports
made by units in FTWZ.