Trade Policy 09-14

8/4/2019 Trade Policy 09-14

http://slidepdf.com/reader/full/trade-policy-09-14 1/28

’ -NDIA S FOREIGN TRADE POLICY 2009 14



INDIA’S FOREIGN TRADE POLICY 2009-14

•

The Union Commerce

Ministry, Government of

India announces theintegrated Foreign TradePolicy FTP in every fiveyear. This is also calledEXIM policy. This policy isupdated every year withsome modifications and

new schemes. Newschemes come into effecton the first day of financialyear i.e. April 1, everyyear. The Foreign tradepolicy which wasannounced on August 28,

2009 is an integratedpolicy for the period 2009-

• What is Foreign TradePolicy?




• 1. To arrest and reversedeclining trend of exports is the main aimof the policy. This aimwill be reviewed aftertwo years.

•

• 2. To Double India'sexports of goods and

services by 2014.

•

• 3. To double India's sharein global merchandisetrade by 2020 as a long

term aim of this policy.India's share in Global

• Objectives of ForeignTrade Policy 2009-14




• 4. Simplification of theapplication procedurefor availing variousbenefits

•

• 5. To set in motion thestrategies and policymeasures whichcatalyse the growth of

exports

•

• To encourage exportsthrough a "mix of measures including

fiscal incentives,institutional changes,

• Objectives of ForeignTrade Policy 2009-14




•

• The policy aims atdeveloping exportpotential, improvingexport performance,boosting foreign tradeand earning valuableforeign exchange. FTPassumes greatsignificance this year asIndia's exports havebeen battered by theglobal recession.

•

• A fall in exports has led tothe closure of severalsmall- and medium-scale export-orientedunits, resultin in lar e-

• Aim in General




•

• Export Target : $ 200Billion for 2010-11

•

• Export Growth Target: 15 %for next two year and 25% thereafter.

• Targets:




•

• Re-fixation of AnnualAverage ExportObligation:

Taking into account thedecline in exports, thefacility of Re-fixation of Annual Average ExportObligation for a particularfinancial year in which

there is decline in exportsfrom the country, has beenextended for the 5 yearPolicy period 2009-14.Support for Green productsand products from North

East extended.

• EPCG Scheme:

1. Obligation under EPCGscheme relaxed.

2. To aid technological upgradation of export sector,EPCG Scheme at Zero Dutyhas been introduced.

3. Export obligation on importof spares, moulds etc.

under EPCG Scheme hasbeen reduced by 50%.




•

• 1. 26 new markets addedin this scheme.

• 2. Incentives under FMSraised from 2.5 % to 3 %

•

• 3. Incentive availableunder Focus Product

Scheme (FPS) raisedfrom 1.25% to 2%.

•

• 4.Extra products includedin the scope of benefitsunder FPS

• Announcements forFPS, FMS, MLFPS:

•




• Announcements• 5. Market Linked Focus Product Scheme (MLFPS) expanded

by inclusion of products like pharmaceuticals, textilefabrics, rubber products, glass products, autocomponents, motor cars, bicycle and its parts.etc.

(However , benefits to these products will be provided, if exports are made to 13 identified markets (Algeria,Egypt, Kenya, Nigeria, South Africa, Tanzania, Brazil,Mexico, Ukraine, Vietnam, Cambodia, Australia and NewZealand).

•

• 6. Focus Product Scheme benefit extended for export of ‘green products’ and some products from the North East.

•

• 7. A common simplified application form has beenintroduced to apply for the benefits under FPS, FMS,MLFPS and VKGUY.




• Announcements for MDA & MAI:

• Higher allocation for Market Development Assistance (MDA)and Market Access Initiative (MAI) has been announced.

• Towns of Export Excellence (TEE)

• The following cities have been recognized as towns of export excellence (TEE)

•

Handicrafts : Jaipur, Srinagar and Anantnag • Leather Products : Kanpur,Dewas and Ambur

• Horticultural Products: Malihabad




• Scheme for Status Holders (Status Holdersmeans star status holders)

• 1. Additional Duty Credit Scrips shall be given to Status

Holders @ 1% of the FOB value of past exportsaccelerate exports and encourage technological upgradation.

•

• 2. This facility shall be available for sectors of leather

(excluding finished leather), textiles and jute,handicrafts, engineering (excluding Iron & steel & non-ferrous metals in primary and intermediate form,automobiles & two wheelers, nuclear reactors & parts,and ships, boats and floating structures), plastics and

basic chemicals (excluding pharma products).




• 3. This facility shall be available up to 31 March, 2011.

•

• 4. Transferability for the Duty Credit scrips being issued

to status holders under VKGUY Scheme permitted onlyfor the procurement of cold chain equipments.




• Extension of Income Tax Exemption to EOU andSTPI :

• Income Tax exemption to 100% EOUs and to STPI unitsunder Section 10B and 10A of

• Income Tax Act, has been already extended for the financialyear 2010-11 in the Budget 2009-10.

• Extension of ECGC :

• The adjustment assistance scheme initiated in

December, 2008 to provide enhanced

• ECGC cover at 95%, to the adversely affected sectors, iscontinued till March, 2010.

•




•

• Fisheries exempted frommaintenance of averageEO under EPCG Scheme

(along with 7 sectors)however Fishing Trawlers, boats, shipsand other similar itemsshall not be allowed forthis exemption.

•

• Additional flexibility under Target Plus Scheme(TPS) / Duty FreeCertificate of Entitlement (DFCE)

Scheme for the marinesector.

• Announcements ForMarine sector :




•

• Duty Drawback is allowedon Gold Jewelleryexports to neutralizeduty incidence.

•

• Plan to establish "DiamondBourse (s) with an aimto make India andInternational TradingHub announced.

•

• Introduction of a newfacility to allow importon consignment basis of cut & polished diamondsfor the purpose of

grading/ certification.

• Announcements forGems & JewellerySector:




•

• Introduction of a singlewindow system tofacilitate export of

perishable agriculturalproduce with an aim toreduce transaction andhandling cost.

•

• This system will involvecreation of multi-functional nodalagencies. Theseagencies will beaccredited by APEDA.

• Announcements forAgro Exports:




•

• On the payment of 50 %applicable export duty,Leather sector shall

be allowed re-exportof unsold importedraw hides and skinsand semi finishedleather from publicbonded ware houses.

• Announcements forLeather Exports :




•

• The existing Minimumvalue addition underadvance authorisationscheme for export of tea

is 100 %. It has beenreduced from theexisting 100% to50%.

•

• DTA (Domestic TarriffArea)

sale limit of instant teaby EOU units increasedfrom

• 30% to 50%.

•

• Export of tea has beenincluded under VKGUY

• Announcements for TeaExports:




•

• Export Obligation Periodfor advanceauthorizations issued

increased from existing6 months to 36 months.

•

• Pharma sector includedunder MLFPS for

countries in Africa andLatin America & somecountries in Oceania andFar East.

• Announcements forPharma Exports :




•

• The claims under FocusProduct Scheme, therequirement of "

Handloom mark" wasrequired earlier. This hasbeen removed.

• Announcements forHandloom Exports




• Scheme for Export Oriented Units:

• EOUs have been allowed to sell products manufactured bythem in DTA (Domestic Tariff Area) upto a limit of 90%instead of existing 75%, without changing the criteria of

‘similar goods’, within the overall entitlement of 50% forDTA sale. (This means that instead of 75% these unitscan sell up to 90 % of their products in the domesticmarkets)

•

• EOU allowed to procure finished goods for consolidation

along with their manufactured goods, subject to certainsafeguards.

•

• Extension of block period by one year for calculation of NetForeign Exchange earning of EOUs kept underconsideration.

•




• Announcements for Value Added Manufacturing(VAM)

• To encourage Value Added Manufactured export, aminimum 15% value addition on imported inputs underAdvance Authorization Scheme.

• Announcements for Project Exports:

• Project Exports and a large number of manufactured goodscovered under FPS and

•

MLFPS.

• Fuel included in DEPB Scheme:

• Custom duty component on fuel where fuel is allowed as aconsumable in Standard Input-Output Norm included in

factoring.




• Easy Import of samples:

• Number of sample pieces has been increased from theexisting 15 to 50. This will facilitate the duty free importof samples by exporters.

• Convertibility of Shipping Bills

• Greater flexibility has been permitted to allow conversion of

Shipping Bills from one Export Promotion scheme toother scheme. Customs shall now permit this conversionwithin three months, instead of the present limitedperiod of only one month.




• Reduction in Transaction Costs:

• Dispatch of imported goods directly from the Port to the sitehas been allowed under Advance Authorisation schemefor deemed supplies. (Presently the duty free importedgoods could be taken only to the manufacturing unit of the authorisation holder or its supporting manufacturer.

• Maximum applicable fee for 18 Authorisations/licenceapplications (except those mentioned in Chapter 3of FTP) has been reduced to Rs. 100,000 from the

existing Rs 1,50,000 (for manual applications) and Rs.50,000 from the existing Rs.75,000 (for EDI applications).

• No fee shall now be charged for grant of incentives underthe Schemes in Chapter 3 of FTP.




• Disposal of Manufacturing Wastes:

• Disposal of manufacturing wastes / scrap will now beallowed after payment of applicable excise duty alsobefore fulfillment of export obligation under Advance

• Authorisation and EPCG Scheme. Earlier it was allowed afterfulfillment of export obligation.

• Announcements for Sports Weapon:

•Licenses for the import of sports weapon will be issued now

by Regional Authorities provided a NOC (No ObjectionCertificate) is issued by Ministry of Sports & Youth Affairs.(Earlier DGFT Headquarters had to be approached forthis)




• Announcements for Medical Devices

• To solve the problem of medical device industry, theprocedure for issue of Free Sale Certificate has beensimplified and the validity of the Certificate has beenincreased from 1 year to 2 years.

•

• Announcements for Automobile Industry

• Those Automobile industries which have their R&D

establishment will be allowed free import of referencefuels (petrol and diesel), upto a maximum of 5 KL perannum, which are not manufactured in India.Simplification in EPCG for automobile industry.




• Announcements for EDI Initiatives

• Export Promotion Councils & Commodity Boards have beenadvised to issue RCMC through a web based onlinesystem.

• It is expected that issuance of RCMC would become EDIenabled before the end of 2009.

• Set up of Directorate of Trade Remedy Measures

Announced

• A Directorate of Trade Remedy Measures shall be set up,which will enable support to Indian industry andexporters, especially the Micro Small & medium

Enterprises MSMEs in availing their rights through traderemedy instruments




• Duty Credit Scrips

• Earlier the payment of customs duty for ExportObligation (EO) shortfall under Advance Authorisation ,DFIA or EPCG Authorisation was allowed in cash only.Now this payment can be done in the way of debit of

Duty Credit scrips.

• Import of Restricted Items

• Restricted Items can be imported now (as replenishment)against transferred DFIAs (Duty Free ImportAuthorisations) as the present DFRC (Duty FreeReplenishment Card) scheme.

• Dollar Credits

•

There is a provision for state-run banks to providedollar credits

Documents

Trade Policy 09-14