Promoting Economic Co-operation - Features and schemes of Foreign Trade Policy 2015-2020

Promoting Economic Co-operation - Features and schemes of Foreign Trade Policy 2015-2020

Question - Bilateral ties between nations can be enhanced through economic cooperation. Discuss the features and schemes outlined by the Foreign Trade Policy 2015-2020 in this context.

The Foreign Trade Policy 2015-2020 was launched by the Ministry of Commerce and Industry recently.

Features

• The Foreign Trade Policy Statement has laid down the objectives, goals and visions underlying the Foreign Trade Policy

• FTP statement outlines the market and product strategy; it also outlines measures needed for trade promotion, infrastructure development and overall improvement of the trade eco system

• India will respond to challenges of the external environment in line with quickly evolving global trading architecture and ensure that trade contributes to the economic development of the nation

• Regular interactions with stakeholders including State governments will aim at achieving national objectives

Schemes

• Foreign Trade Policy 2015-2020 introduces two schemes namely Merchandise Exports from India Scheme/MEIS and Services Exports from India Scheme/SEIS

• MEIS is aimed at export of certain goods to specified markets. SEIS focuses on increasing exports of notified services

• No conditionality is attached to any scrips issued as per these schemes

• Duty credit scrips issued under the two schemes and goods imported under these schemes are completely transferable

• Countries have been divided into 3 groups for grant of rewards under MEIS while the rates of rewards under the scheme are from 2 to 5 percent.

• As per SEIS, selected services will be rewarded from rates of 3 to 5 percent

• Under the EPCG scheme, measures have been followed for nudging procurement of capital goods from indigenous manufacturers through reduction of specific export obligation to 75% of the normal export obligation

• This in turn will aid the promotion of domestic capital goods manufacturing industry

• This will help exporters to develop their productive capacities for local and international consumption

• Under MEIS, measures have been taken for boosting exports of defence and hi-tech items while e-commerce exports of handloom products, books/periodicals and leather footwear as well as toys and customised fashion garments through courier or foreign post office will also get benefits for values up to INR 25,000

• These measures will increase exports and provide employment

• To boost exports from SEZs, government has made the decision to extend benefits of both MEIS and SEIS to units located in SEZs; this will provide impetus for development and growth of SEZs in the nation

• Other focus area of FTP schemes are trade facilitation and improving ease of doing business

• The policy also envisages paperless, 24/7 functioning

• A facility has also been provided to upload documents in exporter/importer profile and exporters will not be needed to submit documents again and again

• Aayat Niryat forms have also been simplified for bring clarity to different provisions and remove ambiguities while enhancing electronic governance

• Manufacturers that are status holders will now self certify manufactured goods in various stages with a view to be able to access preferential treatment under numerous forms of bilateral and regional trade agreements

• Approved Exporter System which is part of this policy enables manufacturer exporters to gain access to global markets

• Numerous steps have been taken for encouragement of manufacturing and exports under 100% EOU/EHTP/BTP/STPI schemes

• Such steps include the following:
- Fast track clearance facilities for units
- Permission for them to share infrastructure facilities
- Permission for inter-unit transfer of goods and services
- Permission to establish warehouses close to the port of export
- Aim to use duty free equipment for training

• 108 MSME clusters have been identified for focused intervention for boosting exports

• Niryat Bandhu Scheme has been initiated to attain the objectives of Skill India

• Outreach activities are organised in a structured manner through the assistance of EPCs, Industry Partners and Knowledge Partners

Facts and Stats

• The Foreign Trade Policy 2015-2020 provides a framework for the increase of exports of goods and services

• It is also aimed at generating jobs and providing value addition to the nation in keeping with the Make In India initiative

• The focus of this international trade policy is to provide support for manufacturing and services sector with stress on enhancing the”ease of doing business”

• "Served from India" scheme was replaced by "Service Export from India Scheme" as per the FTP

• The nomenclature of Export House, Star Export House, Trading House, Premier Trading House certificate has been changed to 1,2,3,4 and 5 Star Export House respectively

• Criteria for export performance for recognition of status holder has shifted from rupees to US dollar earnings

• Vizag and Bhimavarm have been added as Towns of Export Excellence

• Validity period of SCOMET export authorisation rose from current 12 months to 24 months.