Highlights of Mid-term review of Foreign Trade Policy (December 2017)
On 5th December 2017 (Tuesday), our government released the much awaited mid-term review of Foreign Trade Policy (FTP), with a focus on policy measures to boost the exports of goods and services and to increase employment generation along with value-addition. As a part of the same, DGFT has updated the current Foreign Trade Policy by adding a few more benefits, increasing incentives, and simplifying DGFT procedures.
Following are the highlights of the updated policy:
GST Related Reforms:
Issue of working capital blockages has been addressed
MEIS related updates:
Scope of Merchandise Exports from India Scheme (MEIS) and Service Exports from India Scheme (SEIS) enhanced.MEIS incentives for two sub-sectors of Textiles i.e. Ready Made Garments and Made Ups increased from 2% to 4% involving an additional annual incentives of 2743 Crore
Across-the-board increase of 2% in existing MEIS for exports by MSMEs/labour incentive industries (Rs 4,567 crore)
GST rate for transfer/sale of scrips has been reduced to zero from the earlier rate of 12%
SEIS related updates:
- SEIS incentives raised by 2 per cent with a view to boosting services sector exports (Rs 1,140 crore). Sectors include Business, Legal, Accounting, Architectural, Engineering, Educational, Hospital , Hotels and Restaurants and more
- Validity of Duty Credit Scrips increased from 18 months to 24 months to enhance their utility in GST framework
- GST rate for transfer/sale of scrips has been reduced to zero from the earlier rate of 12%
New Trust Based Self Ratification Scheme For Duty Free Import Of Raw Material:
- This scheme has been introduced to allow duty free inputs for export production under duty exemption scheme with a self-declaration
- Under this scheme, instead of getting a ratification of the Norms Committee for inputs to be used in the manufacture of export products, exporters will self-certify the requirement of duty free raw materials/ inputs and take an authorization from DGFT
- This scheme will initially only be available for Authorised Economic Operators (AEO)
Enhanced value limit on the free of cost exports:
- Status holders are entitled to export freely exportable items on free of cost basis for export promotion subject to an annual limit of Rupees 1 crore or 2% of average annual export realization during preceding three licensing years, whichever is lower
- For Pharma exports, the yearly limit would be 2% of the annual export realization during preceding three licensing years
Other operational highlights:
- To focus on improving ease of trading across borders for exporters and importers
- Professional team to handhold, assist and support exporters in accessing markets, meeting regulatory norms
- Establishment of New Logistics Division to promote integrated development of the logistics sector
- Establishment of state-of-the-art trade analytics division in DGFT for data-based policy actions
- New agricultural exports policy to focus on increasing exports of value-added agri products
- New Services Division in DGFT to examine Exim policies and procedures to push services exports
- Supplies of goods and services to SEZs to be treated as zero rated under GST
- Import of second hand goods for repair/refurbishing/re- conditioning/re-engineering made free
- Increase focus on exploring new markets and products, raising share in traditional markets and products
- Promotion of exports by MSMEs and labour intensive sectors to increase employment opportunities for youth
- To enhance participation of Indian industry in global value chain
- DGFT announces relaxation in TMA Scheme Application for Agri-Exporters
- What is MOOWR Scheme and How Can You Benefit From It?
- why is aeo certification from customs so important?
- DGFT Announces Relief in Average Export Obligation for EPCG Scheme
- DGFT declares Sugar Export Quota under TRQ Scheme for the year FY2022-23
- Govt Allows Trade Settlement in RUPEE for Claiming EXPORT INCENTIVEs
- Why Your AEO Status is Important and How to Get It?
- Transport and Marketing Assistance Guidelines Revised, how to Apply for TMA Scheme?