Key Highlights - Foreign Trade Policy 2023

Foreign Trade Policy 2015-20 FTP 2015-20 which was to end on 31.3.2020 was extended due to COVID pandemic and volatile geo-political scenario till 31.03.2023.

India has reach record high Export Performance in Merchandise and Services Exports during this period. India's Merchandise and Services exports is expected to cross record USD 760 Billion in FY2022-23. FTP 2015-20 contributed to this illustrious export performance.

New Foreign Trade Policy 2023

Policy changes were being undertaken since 2015 even without announcement of a new FTP responding dynamically to the emerging situations. 

The Foreign Trade Policy 2023 is being announced to provide the policy continuity and a responsive framework. Subsequent revision(s) in the FTP shall be done as and when required and shall not linked to any date. Continous feedback from Trade and Industry to streamline processes and update Policy & procedures. 

New FTP Approach

1. From Incentives to Tax Remission

2. Greater Trade facilitation through technology, automation, and continuous process re-engineering.

3. Export promotion through collaboration: Exporters, States, Districts.

4. Focus on Emerging Areas – ECommerce Exports, Developing Districts as Export Hubs, Streamlining SCOMET policy etc.

Key FTP Highlights

1. Ease of doing business, reduction in transaction cost and e-initiatives

1.1 Online approvals without physical interface

1.2 Reduction in user charges for MSMEs under AA and EPCG

1.3 E-Certificate of Origin

1.4 Paperless filing of export obligation discharge applications

2. Export promotion initiatives

2.1 Status Holder Export Thresholds Rationalised

2.2 Merchanting trade reform

2.3 Rupee payment to be accepted under FTP Schemes

2.4 Towns of Export Excellence 

3. Districts as Export Hubs initiative

3.1 States and Districts as partners in export promotion

3.2 Capacity building at district level

3.3 Infrastructure and logistics development intervention

4. E-Commerce Exports

4.1 Facilitation for E-Commerce exports

4.2 Dak Niryat facilitation

4.3 E-Commerce Export Hubs

5. Steps to Boost Manufacturing

5.1 Prime Minister Mega Integrated Textile Region and Apparel Parks (PM MITRA) scheme has been added as an additional scheme eligible to claim benefits under CSP(Common Service Provider) Scheme of Export Promotion capital Goods Scheme(EPCG).

5.2 Dairy sector to be exempted from maintaining Average Export Obligation – to support dairy sector to upgrade the technology.

5.3 Battery Electric Vehicles (BEV) of all types, Vertical Farming equipment, Wastewater Treatment and Recycling, Rainwater harvesting system and Rainwater Filters, and Green Hydrogen are added to Green Technology products – will now be eligible for reduced Export Obligation requirement under EPCG Scheme

5.4 Special Advance Authorisation Scheme extended to export of Apparel and Clothing sector under para 4.07 of HBP on self-declaration basis to facilitate prompt execution of export orders – Norms would be fixed within fixed time-frame.

5.5 Benefits of Self-Ratification Scheme for fixation of Input-Output Norms extended to 2 star and above status holders in addition to Authorised Economic Operators at present.

5.6 Fruits and Vegetables exporters are being included for double weightage for counting export performance under eligibility criteria for Status House certification. This is in addition to existing MSME sector who also get double weightage.

6. Special one-time Amnesty Scheme for default in Export Obligations

6.1 In the interest of trade and industry and to motivate the exporters, relief to be provided to exporters who are unable to fulfill their EO against the EPCG and Advance Authorizations. 

7. Emphasis on streamlining SCOMET Licensing Procedure

7.1 Focus of FTP 2023 on Special Chemicals, Organisms, Materials, Equipment and Technologies (SCOMET)

Way Forward

1. Foreign Trade Policy to be dynamic and responsive to the emerging trade scenario.
2. Wider Engagement with States and Districts to promote exports from the grassroots.
3. Focus on E-commerce exports to streamline processes and make it easier for exports to grow in e-commerce space.
4. Sector specific targets to achieve the goal of a one trillion-dollar merchandise exports by 2030.
5. Consultative mechanism to resolve issues of trade and Industry.
6. Work towards making Indian Rupees a global currency and facilitating International Trade settlement in INR.
7. Restructuring of Department of Commerce to make it future ready.

Curtesy: DGFT, Ministry of Commerce and Trade, Govt. of India

Tags: #ftp2023 #dgft #export #import #vorabook

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