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Foreign Trade Policy Concise

Foreign Trade Policy Concise

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Published by yuben joseph
Foreign Trade Policy Concise format
Foreign Trade Policy Concise format

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Published by: yuben joseph on Apr 07, 2010
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08/27/2013

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1.0 INTRODUCTION
India is looked upon as a country with immense resources available through its length and breadth. By the time India gained Independence from the Britishers in 1947, the economy wasentirely geared to only trade. There were hardly any manufacturing facilities to suffice the needsof the growing Indian population. The past couple of decades in the history of Indian Trade haveseen the country struggle to create manufacturing capacities across the board to be self sufficient.The government has been focusing on the same to enable broad basing the development to movethe economy from an underdeveloped status to being a developed nation.India today stands at an over a trillion economy. Darjeeling tea, Indian khadi cotton, BombayDuck, Kashmiri carpets, Indian spices and dry fruit are just a few of the famous gifts India hasgiven to the world. The economic levels have improved in the urban and semi-urban areas. Witheconomic reforms, globalisation of the Indian economy has been the guiding factor informulating the trade policies. The reform measures introduced in the subsequent policies havefocused on liberalization, openness and transparency. They have provided an export friendlyenvironment by simplifying the procedures for trade facilitation. The announcement of a newForeign Trade Policy for a five year period, replacing the hitherto nomenclature of EXIM Policy by Foreign Trade Policy (FTP) is another step in increasing foreign trade. It takes an integratedview of the overall development of India’s foreign trade and provides a roadmap for thedevelopment of this sector. A vigorous export-led growth strategy of doubling India’s share inglobal merchandise trade, with a focus on the sectors having prospects for export expansion and potential for employment generation, constitute the main plank of the policy. All such measuresare expected to enhance India's international competitiveness and aid in further increasing theacceptability of Indian exports. The policy sets out the core objectives, identifies key strategies,spells out focus initiatives, outlines export incentives, and also addresses issues concerninginstitutional support including simplification of procedures relating to export activities.The key strategies for achieving its objectives include:-
Unshackling of controls and creating an atmosphere of trust and transparency;
Simplifying procedures and bringing down transaction costs;
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 Neutralizing incidence of all levies on inputs used in export products;
Facilitating development of India as a global hub for manufacturing, trading and services;
Identifying and nurturing special focus areas to generate additional employmentopportunities, particularly in semi-urban and rural areas;
Facilitating technological and infrastructural upgradation of the Indian economy,especially through import of capital goods and equipment;
Avoiding inverted duty structure and ensuring that domestic sectors are notdisadvantaged in trade agreements;
Upgrading the infrastructure network related to the entire foreign trade chain tointernational standards;
Revitalizing the Board of Trade by redefining its role and inducting into it experts ontrade policy; and
Activating Indian Embassies as key players in the export strategy.
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2.0 FOREIGN TRADE POLICY 2009-2014
2.1CONTEXT
The UPA Government has assumed office at a challenging time when the entire world is facingan unprecedented economic slow-down. The year2009 is witnessing one of the most severeglobal recessions in the post-war period. Countries across the world have been affected invarying degrees and all major economic indicators of industrial production, trade, capital flows,unemployment, per capita investment and consumption have taken a hit.Though India has not been affected to the same extent as other economies of the world, yet our exports have suffered adecline in the last 10 months due to a contraction in demand in the traditional markets of our exports. After four clear quarters of recession there is some sign of a turnaround and theemergence of ‘green shoots’.Announcing a Foreign Trade Policy in this economic climate isindeed a daunting task. We cannot remain oblivious to declining demand in the developed worldand we need to set in motion strategies and policy measures which will catalyse the growth of exports.
2.2 OBJECTIVES
The short term objective of our policy is to arrest and reverse the declining trend of exports andto provide additional support especially to those sectors which have been hit badly by recessionin the developed world. We would like to set a policy objective of achieving an annual exportgrowth of 15% with an annual export target of US$ 200 billion by March 2011. In the remainingthree years of this Foreign Trade Policy i.e. upto 2014, the country should be able to come back on the high export growth path of around 25% per annum. By 2014, we expect to double India’sexports of goods and services. The long term policy objective for the Government is to doubleIndia’s share in global trade by 2020.
2.3 STRATEGIES
In order to meet these objectives, the Government would follow a mix of policy measuresincluding fiscal incentives, institutional changes, procedural rationalization, enhanced market
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