NEW DELHI: Commerce and Industry Minister Piyush Goyal released Foreign Trade Policy 2023 last week terming it as “dynamic” “open-ended” to accommodate the emerging needs of the time. He stated that the policy had been under discussion for a long time and had been formulated after multiple stakeholder consultations.
India’s overall exports, including services and merchandise exports, have already crossed $750 billion and are expected to cross $760 billion this year, he said.
PM Modi’s vision
The minister referred to the interaction that Prime Minister Narendra Modi had with exporters on 6 August 2021 where he had encouraged them to increase exports and get more deeply involved in the global value chain. Goyal lauded the vision and guidance of the Prime Minister who believed that given the size of the Indian economy and manufacturing and service sector base, the potential for the country to grow was manifold. He said that this vision was at the core of the policy.
He stressed that every opportunity for export must be captured and utilised effectively. He also mentioned that in the next five months, during India’s G20 presidency, there should be a massive concentrated outreach with the world both sector-wise and country-wise.
Four-pillars of policy
The release of the policy was also attended by State Commerce Minister Anupriya Patel; Commerce Secretary Sunil Barthwal and Member, Customs, Central Board of Indirect Taxes and Customs, Rajiv Talwar. Director General of Foreign Trade Santosh Kumar Sarangi gave a detailed presentation on the policy.
The policy is based on four key pillars: (i) Incentive to Remission (ii) Export promotion through collaboration – Exporters, States, Districts, Indian Missions (iii) Ease of doing business, reduction in transaction cost and e-initiatives and (iv) Emerging areas – E-commerce developing districts as export hubs and SCOMET (Special Chemicals, Organisms, Materials, Equipment and Technologies) policy.
Technology backbone
Greater faith is being reposed on exporters through automated IT systems with risk management system for various approvals. The policy emphasizes export promotion and development, moving away from an incentive regime to a regime which is facilitating, based on technology interface and principles of collaboration.
FTP 2023 codifies implementation mechanisms in a paperless, online environment, building on earlier ‘ease of doing business’ initiatives. Reduction in fee structures and ITbased schemes will make it easier for MSMEs and others to access export benefits.
Four new towns, namely Faridabad, Mirzapur, Moradabad, and Varanasi, have been designated as Towns of Export Excellence (TEE) in addition to the existing 39 towns. The TEEs will have priority access to export promotion funds under the MAI scheme and will be able to avail Common Service Provider (CSP) benefits for export fulfillment under the EPCG Scheme. This addition is expected to boost the exports of handlooms, handicrafts, and carpets.
Dynamic approach to policymaking
FOREIGN Trade Policy (2023) is a policy document which is based on continuity of time-tested schemes facilitating exports as well as a document which is nimble and responsive to the requirements of trade.
It is based on principles of ‘trust’ and ‘partnership’ with exporters. In the FTP 2015-20, changes were done subsequent to the initial release even without announcement of a new FTP responding dynamically to the emerging situations.
Hereafter, the revisions of the FTP shall be done as and when required. Incorporating feedback from trade and industry would also be continuous to streamline processes and update FTP, from time to time.
The FTP 2023 aims at process re-engineering and automation to facilitate ease of doing business for exporters. It also focuses on emerging areas like dual use high end technology items under SCOMET, facilitating e-commerce export, collaborating with states and districts for export promotion.
The new FTP is introducing a one-time Amnesty Scheme for exporters to close the old pending authorizations and start afresh. It encourages recognition of new towns through ‘Towns of Export Excellence Scheme’ and exporters through ‘Status Holder Scheme’.
The policy is facilitating exports by streamlining the popular Advance Authorization and EPCG schemes, and enabling merchanting trade from India.
