 It is also known as the EXIM policy.  Directorate General of Foreign Trade (DGFT) comes under the Central ministry of Commerce and Industry.  It is announced for a term of five years.  Modifications are done on yearly basis.  New schemes are also announced on yearly basis.

 It is a set of guidelines and instructions established by the DGFT in matters related to the import and export of goods.  It takes integrated view of the overall development of India’s foreign trade and goes beyond the traditional focus on pure exports.  It lays the guidelines to help the trader’s trade efficiently and make the maximum.  Currently FTP is followed.

 Helps to increase the revenue of the nation.  Provides us with foreign reserve.  Helps in the economic development of a country.  Helps to increase the market of a product.  Increase in efficiency and productivity.  Easy access to new technological innovations.

 Division of labor and specialization.  Optimum allocation and utilization of resources.  Equality of prices.  Availability of multiple choices.  Raises standard of living of the people.

 To accelerate the economy from low level of economic activities to high level of economic activities.  Derive maximum benefits from expanding global market opportunities.  To stimulate sustained economic growth by providing access to essential raw materials, intermediates, components, consumables and capital goods required for augmenting production.

 Improving competitiveness and efficiency of Indian agriculture, industry and services.  Encourage the attainment of internationally accepted standards of quality.  To generate new employment.  To provide quality consumer products at reasonable prices.

 To arrest and reverse declining trend of exports is the main aim of the policy.  To Double India’s exports of goods and services by  Simplification of the application procedure for availing various benefits.  To set in motion the strategies and policy measures which catalyse the growth of exports  To double India’s share in global merchandise trade by 2020 as a long term aim of this policy.  To encourage exports through a “mix of measures including fiscal incentives, institutional changes, procedural rationalisation and efforts for enhance market access across the world and diversification of export markets

 Incentive available under FMS raised from 2.5% to 3%.  Incentive available under Focus Product Scheme (FPS) raised from 1.25% to 2%.  Widens scope for products to be included for benefits under FPS.  Additional engineering products, plastic and some electronics get a look in.  Higher allocation for Market Development Assistance (MDA) and Market Access Initiative (MAI).  To aid technological upgradation of export sector, EPCG Scheme at Zero Duty has been introduced.

 Jaipur, Srinagar and Anantnag have been recognised as‘Towns of Export Excellence’ for handicrafts; Kanpur, Dewas and Ambur for leather products; and Malihabad for horticultural products.  Export obligation on import of spares, moulds etc. under EPCG Scheme has been reduced by 50%.  Focus Product Scheme benefit extended for export of ‘green products and some products from the North East Status Holders  To impart stability to the Policy regime, Duty Entitlement Passbook (DEPB) Scheme is extended beyond till  Interest subvention of 2% for pre-shipment credit for 7 specified sectors has been extended till in the Budget

TECHNOLOGY UPGRADATION  EPCG Scheme at Zero Duty has been introduced for engineering & electronic products, basic chemicals & pharmaceuticals, apparels & textiles, plastics, handicrafts, chemicals & allied products and leather & leather products. SUPPORT FOR GREEN PRODUCTS  Focus Product Scheme benefit extended for export of green products, and for exports of some products originating from the North East. LEATHER SECTOR  Re-exporting of unsold imported hides and skins and semi-finished leather have been from public bonded warehouses, on payment of 50% export duty.  Increase of FPS rate to 2% will reportedly benefit this sector.

Gems and Jewellery  The manpower centered Gems and Jewellery sector will probably get a bigger boost from this Foreign Trade Policy.  The government has declared duty draw backs on gold Jewellery exports, in case the yellow metal has been imported independently by Jewellery makers.  This stimulating move will inspire Jewellery exporters to import more raw materials like gold and then export it after value-addition.  To establish India on the global map as a ‘diamond trading hub’ a plan to set up a ‘Diamond Bourses’ is on the cards. The first one has already been set up in Mumbai.

TEA  Minimum value addition under advance authorisation scheme for export of tea has been reduced from the existing 100% to 50%.  DTA sale limit of instant tea by EOU units has been increased from the existing 30% to 50%.  Export of tea has been covered under VKGUY Scheme benefits. SIMPLIFICATION OF PROCEDURES  To facilitate duty free import of samples by exporters, number of samples/pieces has been increased from the existing 15 to 50.  Greater flexibility has been permitted to allow conversion of Shipping Bills from one Export Promotion scheme to other scheme.  To reduce transaction costs, dispatch of imported goods directly from the Port to the site has been allowed under Advance Authorisation scheme for deemed supplies.  Regional Authorities have now been authorised to issue licences for import of sports weapons by renowned shooters.

FLEXIBILITY PROVIDED TO EXPORTERS  Payment of customs duty for Export Obligation (EO) shortfall under Advance Authorisation / DFIA / EPCG Authorisation has been allowed by way of debit of Duty Credit scrips. Earlier the payment was allowed in cash only.  Time limit of 60 days for re-import of exported gems and jewellery items, for participation in exhibitions has been extended to 90 days in case of USA.  Transit loss claims received from private approved insurance companies in India will now be allowed for the purpose of EO fulfillment under Export Promotion schemes. At present, the facility has been limited to public sector general insurance companies only. HANDLOOM SECTOR  To simplify claims under FPS, requirement of Handloom Mark for availing benefits under FPS has been removed.

 After the implementation foreign trade policy, the import and export among foreign countries have increased and have become more secured.  Setting up of EPZ and SEZ have also increased foreign investors.  Trading Housing have given a platform to both manufacturers and consumers to freely and easily trade between different countries.  Simplification of procedures and incentives given to exporters/importers have acted in a good way but more needs to be done in this field.  Thus in conclusion we can say that India is trying to be more liberal in its foreign trade policy and it will prove to be beneficial for us in future.