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Indian Foreign Trade

Policy

PRESENTED BY,

SWAPNIL GUPTA (404)
SATYAJIT RAJAK (399)
SANDIPAN SAMADDAR (398)

What is Foreign Trade Policy

Foreign Trade Policies are Government actions,
especially tariffs, import quotas, and export
subsidies, designed to increase net exports by
promoting exports or restricting imports

Advent of Foreign Trade Policy in India
 In the year 1962, the Government of India appointed a special

Exim Policy Committee to review the previous export import policies
 Mr. V. P. Singh, the then Commerce Minister and announced the Exim

Policy on the 12th of April, 1985
 Initially the EXIM Policy was introduced for the period of 3 years
 After liberalization in 1991, tenure of policy was changed to 5 years
 In 2004, EXIM policy was replaced by Foreign Trade Act Policy of

2004

Objectives of EXIM Policy  To accelerate the economy from low level of economic activities to high level of economic activities  To stimulate sustained economic growth by providing access to essential raw materials  To enhance the techno local strength and efficiency of Indian agriculture. . industry and services  To generate new employment  To provide quality consumer products at reasonable prices.

Governing Body of EXIM Policy  Foreign Trade (Development and Regulation Act). 1992  Union Minister of Commerce and Industry  Ministry of Finance (Directorate General of Foreign Trade) .

1992  To liberalize imports and boost export  Duration 5 years  Amendments could be made by Central Government .EXIM Policy 1992-1997  Introduced on April I.

EXIM Policy 1997-2002  Simplified the procedures between exporters and the DGFT  Liberalization  Imports Liberalization  Export Promotion Capital Goods (EPCG) Scheme  Advance License Scheme  Duty Entitlement Pass Book (DEPB) Scheme .

industry and services  To provide consumers with good quality products and services at internationally competitive prices . intermediates & services required for augmenting production  To improve the technological strength and efficiency of Indian agriculture.EXIM Policy 2002 – 2007  Export and import of merchandise and services  To encourage economic growth by providing supply of essential raw materials.

Marine goods .Indian Foreign Trade Policy (2004-2009)  The first Foreign Trade Policy was formed in 2004 for a period of 5 years  Two major objectives : 1.Agriculture . greater stress was laid on labor intensive exports like : . as a promotion of GDP 2.Handicrafts . increasing the exports.Handloom .Spices .

Duty Exemption Schemes of EXIM Policy 2004-2009  Duty Drawback  Excise Duty Refund  Octroi Exemption .

Duty Remission Schemes of EXIM Policy 2004-2009  Duty Entitlement Pass Book (DEPB)  Duty Free Replenishment Certificate (DFRC) schemes .

Electronics Hardware Technology Parks (EHTPs).Special Measures of EXIM Policy 2004-2009  Duty Free Import Authorization (DFIA)  Export Promotion Capital Goods Scheme (EPCG)  Export Oriented Units (EOUs). Software Technology Parks(STPs) And Bio-Technology Parks (BTPs)  Special Economic Zone (SEZ)  Free Trade & Warehousing Zones .

duty and tariff  Self-contained and integrated having their own infrastructure and support services .Special Economic Zone (SEZ)  Geographically distributed area or zones where the economic laws are more liberal  Duty free enclaves for the purpose of trade. operations.

Indian Foreign Trade Policy (2009-2014)  The second 5 year Foreign Trade Policy was formed from 2009-2014  Two major objectives : 1. Double the percentage share of global merchandize trade within 5 years 2. Use trade expansion as an effective instrument of economic growth and employment generation .

Special Focus Initiatives of Foreign Trade Policy (2009-2014)  Market Diversification  Technology Upgradation  Agriculture & Village Industry  Handicrafts  Gems & Jewelry  Marine Sector  Electronics & IT Hardware Manufacturing Industries  Sports Goods .

5% to 3%  ‘Market Linked Focus Product Scheme’ . MARKET DIVERSIFICATION  26 new countries included in Focus Market Scheme (FMS)  Incentives under FMS increased from 2.1.

2. TECHNOLOGICAL UPGRADATION :  EPCG Scheme at zero duty  Towns of Export Excellence .

AGRICULTURE & VILLAGE INDUSTRY :  Vishesh Krishi and Gram Udyog Yojana  Import of restricted items  Import of pesticides Permitted  Single Window System introduced .3.

HANDICRAFTS :  Duty free import entitlement of tools. trimmings and embellishments was 5% of FOB  All handicraft exports were to be treated as special Focus products and entitled to higher incentives .4.

000  Personal carriage of Gems & Jewelry products was increased to US$ 5 million  Duty Drawback on export of gold jewelry  Diamond Bourse . 300.5. GEMS & JEWELRY :  Import of gold of 8 k and above was allowed under replenishment scheme  Duty free import entitlement of commercial samples was allowed upto Rs.

MARINE SECTOR :  Imports for technological upgradation under EPCG in fisheries sector  Duty free import of specified specialized inputs/chemicals and flavoring oils was allowed to the extent of 1% of FOB  Marine products are considered for VKGUY scheme .6.

ELECTRONICS & IT HARDWARE MANUFACTURING INDUSTRIES : Exporters /Associations were entitled to utilize MAI & MDA Schemes for promoting Electronics and IT Hardware Manufacturing industry exports 8.7. SPORTS GOODS & TOYS :  Duty free import of specified specialised inputs was allowed to the extent of 3 % of FOB  Sports goods and toys were to be treated as a Priority sector under MDA / MAI Scheme .

Promotional Measures of Foreign Trade Policy (2009-2013)  Assistance to States for Infrastructure Development of Exports        (ASIDE) Market Access Initiative (MAI) Market Development Assistance (MDI) Towns of Export Excellence (TEE) Brand Promotion & Quality Export & Trading Houses Focus Market Scheme (FMS) Focus Product Scheme (FPS) .

1. ASIDE :  Creation of new Export Promotion Industrial Parks/Zones  Setting up of electronics and other related infrastructure in export conclave  Equity participation in infrastructure projects  Development of complementary infrastructure  Stabilizing power supply .

MARKET ACCESS INITIATIVE (MAI) :         Market studies/surveys Setting up of showroom / warehouse Participation in international trade fairs Displays in International departmental stores Publicity campaigns Brand promotion Testing charges for engineering products abroad Assistance for contesting Anti Dumping litigations .2.

MARKET DEVELOPMENT ASSISTANCE (MDA) :  Trade Fairs and Buyer Seller meets abroad or in India.3. and  Export promotions seminars  Financial assistance with travel grant is available to exporters .

750 crore or more will be notified as TEE  Recognized associations of units will be provided financial assistance under MAI scheme  Common Service Providers in these areas shall be entitled for EPCG scheme.4. . TOWNS OF EXPORT EXCELLENCE (TEE) :  It is necessary to grant recognition to dynamic industrial clusters  Selected towns producing goods of Rs.

1996  IBEF aims to promote India as a business opportunity by creating positive economic perceptions of India globally  Aims to create international awareness of the “Made in India” label in markets overseas 6. Service Providers. shall be eligible for status. EXPORT AND TRADING HOUSES Merchant as well as Manufacturer Exporters. . BRAND PROMOTION AND QUALITY :  India Brand Equity Foundation was set up by the Ministry of Commerce on 11th July.5. Export Oriented Units (EOUs) and Units located in Special Economic Zones (SEZs).

FOCUS MARKET SCHEME (FMS) :          Following categories of export products/sectors shall be ineligible for Duty Credit Scrip: Supplies made to SEZ units Service Exports Diamonds and other precious.7. platinum and other precious metals Jewelry Ores and Concentrates Cereals Sugar Crude/Petroleum Oil & Crude/Petroleum based Products . semi precious stones Gold. silver.

8. FOCUS PRODUCT SCHEME (FPS) :  Incentivise export of products having high export intensity employment potential  Offset infrastructure inefficiencies and other associated costs involved in marketing of these products .

Export Oriented Units (EOU)  Allowed to sell products manufactured by them in DTA up to a limit of 90%  CENVAT Credit facility allowed .

Foreign Trade Policy (2014-2019)  The new Foreign Trade Policy 2014-19 is made product wise and location wise  Enhancing trade competitiveness  India’s share in world trade is expected to double from the present level of 3% by the year 2020  Includes necessary measures to boost productivity .

Conclusion  India is focusing on increasing its export value by providing possible assistance to the traders in the form of financial aid. duty free schemes. etc. promotional schemes. awards.  It is important for India to take an initiative to diversify the export markets to emerging markets of Africa.  India has reached a point where its exports to developed economies cannot be increased so it has to focus on diversifying its market to less developed economies and remote areas. Latin America & Oceania through appropriate policy instruments . initiatives.