Foreign Trade Policy
Foreign Trade Policy
The Foreign Trade Policy (FTP) was introduced by the Government to grow the Indian export of goods and services, generating employment and increasing value addition in the country. The Government, through the implementation of the policy, seeks to develop the manufacturing and service sectors. This article is a snapshot of the various aspects of the policy.
Primary Focus Areas
The Government, through the policy, primarily focuses on adopting a twin strategy of promoting traditional and sunrise sectors of exports including services. Further, it intends to simplify the process of doing business.
Duration of the Policy
The Foreign Trade Policy (FTP) was flagged off in the financial year of 2015-16, and will remain effective until the 31st of March, 2020. During this period, all the exports and imports of the country will be governed by the policy. The Government strives to make India a significant partner in global trade by 2020.
Foreign Trade Policies Aimed at Improving Ease of Doing Business
Here’s an overview of some of the major initiatives under the Foreign Trade Policy:
Niryat Bandhu Scheme
DGFT has come up with the Niryat Bandhu Scheme for mentoring budding exporters on the intricacies of foreign trade by means of counseling, training and outreach programmes. Given the rise of small and medium scale enterprises and their role in employing people, MSME clusters have been identified for focused interventions to increase exports.
To achieve the objective of the scheme, outreach activities will be organized in a structured manner with the assistance of Export Promotion Councils and other willing knowledge partners in academia and research community. Besides, for the optimal utilization of resources, all the stakeholders will be attempted to be associated, including Customs, ECGC, Banks and concerned Ministries.
Import exporter code, or in casual terms, export permit is mandatory for carrying out exports and imports from/to another country. DGFT has facilitated the online filing of IEC application.
The initiative of Electronic Bank Certificate (e-BRC) enables DGFT to capture essential details of realization of export proceeds directly from the banks by means of secured electronic mode. This paves the way for implementation of various export promotion schemes without any physical interface with the stake holders.
A Memorandum of Understanding (MOU) has been signed with 14 State Governments for sharing e-BRC data to benefit the exporters with GST refunds. Moreover, MOU has been signed with Enforcement Directorate, Agricultural Directorate, Agricultural Processed Food Products Export Development Authority and Goods and Services Tax Network (GSTN).
Exporter Importer Profile
Exporter importer profile is created to upload various documents, and to reduce the cost of transaction and time. One of the featured advantages of the system is that after the documents are uploaded, it isn’t necessary to submit the documents or copies of the same to Regional Authority repeatedly with each application.
Online Filing of Applications
Thanks to digitization, filing of applications has been made easier than ever before. The DGFT has facilitated the online filing of applications to obtain IEC and various Authorizations/scrip. The entity has introduced a web interface for online filing of application. The application can be paid online and the fees can be remitted through the banking facilities provided. The furnished applications are digitally signed and submitted electronically to the concerned Regional Authority of DGFT, post which it is electronically processed by the Regional Authority and Authorization/scrip’s are issued.
Online Inter-Ministerial Consultation
In a recent development, the exporters are provided with a facility to upload copies of all the required documents including technical specifications, literature, and the likes of it in PDF, JPG, JPEG or GIF format in the online filing system in respect of:
- Fixation of norms under Advance Authorization by Norms Committees.
- Export of restricted items.
- Import of restricted items.
- SCOMET items.
The exporters are not anymore required to submit the hard copy of application other than agricultural drawings, machine drawings, etc; which is difficult to scan and upload. The applications will be processed online.
Facility for CA/CS/Cost Accountant
Charted Accountants, Company Secretaries and Cost Accountants can now upload their digitally signed documents through an electronic procedure. By using this facility, the exporter shall link digitally uploaded annexure with his/her online application.
Electronic Data Interchange
DGFT has established the system of EDI with the objective of facilitating exports and promoting good governance. The official body has set up a secured EDI message exchange system for activities connected with documentation, namely; Customs, banks and EPC’s; thereby resulting in reduced physical interface of exporters and importers with the Government Departments. Besides, it leads to the waiver of transaction costs.
Export consignments will be processed without any delay/ withdrawal for any reason. The concerned authorities can instead ask for an undertaking from exporter and release such consignment.
Withdrawal of Seizure of Export Related Stock
Agencies should abstain from making any seizures as it stands in the way of the manufacturing activity and hampers the schedule of delivery. Certain agencies are still entitled to conduct the seizure based on prima facie evidence of serious irregularity, in which case the seizures should be withdrawn within seven days unless the defaults are substantiated.
Round-the-Clock Customs Clearance
24*7 customs clearance has been made available at 19 sea ports and 17 air cargo complexes. The round-the clock Customs clearance facility has been extended to all Bills of Entry at 19 sea ports and 17 Air Cargo Complexes. In addition to it, Merchant Overtime Charges (MOT) need not be collected for the services provided by the Customs officers at 24*7 Customs Ports and Airports.
Single Window Interface
Single Window Interface for Facilitating Trade (SWIFT) has been launched to facilitate the easier perusal of business. The system enables the importers to electronically lodge Integrated Declaration at a single point only with Customs. The necessary permissions are obtained from other regulatory agencies without physically approaching them.
Authorized Economic Operator (AEO) Programme
In accordance with WCO’s Safe Framework of Standards (FOS), Indian Customs have developed an Authorized Economic Operator (AEO) programme to the benefit of businesses engaged in international trade. The following benefits are accorded:
- Secure supply chain from point of export to import.
- Potential to comply with the security standards when contracting to supply overseas importers or exporters.
- Enhanced privileges of border clearance in countries partnered by Mutual Recognition Agreement (MRA).
- Minimal disruption to flow of cargo after a disruption related to security disruption.
- Reduction in dwell time and related costs.
- Customs advice or assistance on unforeseen issues experienced by trade with Customs of countries with which India have partnered with MRA.
Facility of Filing Shipping Bills
Shipping bills can now be filed online before the actual shipment. Bills of air shipment can be filed before seven days, whereas bills of ICD’s can be filed before 14 days for shipments by sea.
Facilitating Export of Perishable Export Products
To reduce the costs of transportation and handling, a single window system has been introduced to facilitate the export of perishable agricultural produce. Under this system, multi functional nodal agencies will be accredited by the Delhi based Agricultural and Processed Food Products Export Development Authority (APEDA).
Time Release Study
Time release study is a unique tool created by the WCO for determining the actual performance of Customs. In addition to it, the tool helps in identifying bottlenecks in the international supply chain or constraints affecting Customs release. Indian Customs will now implement it at major Customs locations on a six-month basis.
Towns of Export Excellence
Specified towns with a goods turnover of Rs 750 Crore or more may be notified as TEE based on its export potential. Handloom, handicraft, agriculture and fisheries sector will have a threshold limit of Rs 150 Crore. Tee’s will be provided with the following benefits:
- Recognized associations of units will receive financial assistance under MAI scheme on priority basis, for export promotion projects in marketing, capacity building and technological services.
- Common service providers in these areas will be considered eligible for Authorization under EPCG scheme.
National Committee on Trade Facilitation (NCTF)
National Committee on Trade Facilitation (NCTE) has been constituted in consequence to India’s ratification of the WTO agreement on Trade Facilitation (TFA). It has been established to facilitate domestic co-ordination and implementation of TFA provisions.
E-Mail Notification Service
The Central Board of Excise and Customs (CBEC) has commenced an e-mail notification service to assist the importers with information pertaining to all important stages of import clearances.
Facility of Deferred Payment
As another measure for facilitation of trade, the CBEC has introduced the facility of deferred payment of customs duty. Certified importers under AEO programme are considered eligible for availing the benefit of the facility.
Import Export Code
The Import Export Code is a primary document necessary for commencing Import-export activities. The IE code is to be obtained for exporting or importing goods or services. IEC has numerous benefits for the growth of the business. Indeed, you cannot ignore the necessity of IE code registration, as it is mandatory. You can apply for an Import Export code through IndiaFilings and obtain it within 6 to 7 days
Indian Foreign Trade Policy