Union Minister of Commerce & Industry unveiled Foreign Trade Policy 2015-2020
The new five year Foreign Trade Policy, 2015-20 provides a framework for increasing exports of goods and services as well as generation of employment and increasing value addition in the country.
Union Minister of Commerce & Industry on 2 April 2015 unveiled Foreign Trade Policy (FTP) 2015-2020. The policy was unveiled by Minister of State for Ministry of Commerce & Industry Nirmala Sitharaman at Vigyan Bhawan, Delhi.
The new five year Foreign Trade Policy, 2015-20 provides a framework for increasing exports of goods and services as well as generation of employment and increasing value addition in the country, in keeping with the Make in India vision of Prime Minister.
The focus of the new policy is to support both the manufacturing and services sectors, with a special emphasis on improving the ease of doing business.
The release of Foreign Trade Policy was also accompanied by a FTP Statement explaining the vision, goals and objectives underpinning India's Foreign Trade Policy, laying down a road map for India’s global trade engagement in the coming years.
The FTP Statement describes the market and product strategy and measures required for trade promotion, infrastructure development and overall enhancement of the trade eco system. It seeks to enable India to respond to the challenges of the external environment, keeping in step with a rapidly evolving international trading architecture and make trade a major contributor to the country’s economic growth and development.
Highlights of the FTP 2015-20
• In the new policy FTP2015-20, two new schemes Merchandise Exports From India Scheme (MEIS) and Services Exports From India Scheme (SEIS) were introduced.
• MEIS is for export of specified goods to specified markets and SEIS is for increasing exports of notified services. Duty credit scrips issued under MEIS and SEIS and the goods imported against these scrips are fully transferable. For grant of rewards under MEIS, the countries have been categorized into 3 Groups, whereas the rates of rewards under MEIS range from 2% to 5%. Under SEIS the selected Services would be rewarded at the rates of 3% and 5%.
• Measures have been adopted to nudge procurement of capital goods from indigenous manufacturers under the EPCG scheme by reducing specific export obligation to 75% of the normal export obligation. This will promote the domestic capital goods manufacturing industry.
• Such flexibilities will help exporters to develop their productive capacities for both local and global consumption. Measures have been taken to give a boost to exports of defense and hi-tech items.
• At the same time e-Commerce exports of handloom products, books/periodicals, leather footwear, toys and customized fashion garments through courier or foreign post office would also be able to get benefit of MEIS.
• These measures would not only capitalize on India's strength in these areas and increase exports but also provide employment.
• In order to give a boost to exports from Special Economic Zones (SEZs), Government has now decided to extend benefits of both the reward schemes (MEIS and SEIS) to units located in SEZs. It is hoped that this measure will give a new impetus to development and growth of SEZs in the country.
• 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 24x7 Environment.
• Recently, the government has reduced the number of mandatory documents required 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 will not be required to submit documents repeatedly.
• Government has also simplified various Aayat Niryat Forms, bringing in clarity in different provisions, removing ambiguities and enhancing electronic governance.
• Manufacturers will now be enabled to self certify their manufactured goods in phases, as originating from India with a view to qualifying for preferential treatment under various forms of bilateral and regional trade agreements.
• This Approved Exporter System will help these manufacturer exporters considerably in getting fast access to international markets.
• A number of steps have been introduced for encouraging manufacturing and exports. The steps include a fast track clearance facility for these units, permitting them to share infrastructure facilities, permitting 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.