Incentives worth Rs 8,000 crore, focus on micro, small and medium enterprises (MSMEs), labour-intensive segments and the agriculture sector, and a self-certification scheme for duty-free imports are some of the highlights of the mid-term review document of India’s foreign trade policy (FTP) released today by the Directorate General of Foreign Trade (DGFT).
Incentives for goods exports are worth Rs. 4,567 crore while for services exports, it is Rs. 1,140 crore. The review stresses on focusing on new markets like Africa, Latin America and the Caribbean.
In April 2015, the government had announced several incentives in the five-year FTP for exporters and units in the special economic zones (EPZs) to nearly double India’s exports of goods and services to $900 billion by 2020.
The review was postponed from July to December to assess the impact of the goods and services tax (GST) as the DGFT had promised remedial action.
Despite economic slowdown in developed countries, Brexit, volatility in commodity prices and general uncertainty affecting India’s export sector, the country witnessed positive export growth in 13 of the past 14 months, minister of commerce and industry Suresh Prabhu said in the review document.
The issue of working capital blockage of exporters due to upfront payment of GST on inputs has been addressed by extending to them the benefit of sourcing inputs or capital goods from abroad as well as domestic suppliers without upfront GST payment. An E-wallet will be launched from April 1 next year and a team of experts will be set up to assist exporters on GST issues.
Merchandise Exports from India Scheme (MEIS) incentives for two textile sub-sectors — reademade garments and made-ups — have been raised from 2 per cent to 4 per cent, leading to a cumulative incentive of Rs 2,743 crore.
Under the self-certification scheme for duty-free imports, instead of getting a ratification of the Norms Committee for inputs to be used in the manufacture of export products, exporters will self-certify that requirement and take an authorization from the DGFT.
This scheme, that aims to reduce product turn-around time in sectors like chemicals, textile and engineering, will be initially applicable to authorized economic operators (AEOs). (DS)
Source Fibre2Fashion News Desk – India