Key Highlights

• Ease of Doing Business, Reduction in Transaction Cost, and e-Initiatives
  • Online Approvals without Physical Interface
    • Director General of Foreign Trade (DGFT) has implemented rule-based automatic approval systems using business analytics tools for FTP applications. It has been introduced on pilot basis for Advance Authorization (AA) Extension/Revalidation Applications.
    • Reduction in processing time and immediate approval of applications under automatic route for exporters:

• Reduction in user charges for MSMEs under Advance Authorization (AA) and Export Promotion Capital Goods Scheme (EPCG)
  • Application fee is reduced for Advance Authorization and EPCG Schemes which will benefit about 55-60% of exporters who are MSMEs.
  • The fee structure is as shown below:

• Digitization of Applications pertaining to FTP
  • Export promotion schemes processes for managing the lifecycle of AA/EPCG/DFIA/Import/Export Licensing have been made completely paperless and online.

• Export Promotion Initiatives
  • Status holder export thresholds rationalised

Export performance threshold for recognition of exporters as status holders is rationalized. Enabling more exporters to achieve higher status and reduced transaction cost for exports.

• Merchanting Trade Reform
  • Provisions for merchanting trade introduced under FTP.
  • To boost merchanting activities from India-where goods do not touch Indian border. The merchant buys from one country and supplies to another country while based in India.
  • Expected to facilitate merchanting trade from India making India a trade hub.

• Internationalization of Trade in Rupees
  • International Trade Settlement in Rupees (Rs.) has been allowed.
  • Changes introduced in the FTP for grant of export benefits and fulfillment of export obligation for export realizations through Vostro Accounts in Rupees (Rs.) as per a circular issued by RBI on July 11, 2022.

• Towns of Export Excellence
  • Four new Towns of Export Excellence (TEE) are being declared in addition to the already existing 39 towns of export excellence.

• This scheme gives thrust to cluster-based economic development.
• TEEs are industrial clusters that are recognized based on their export performance. Recognition to these industrial clusters is granted with a view to maximize their potential and enable them to move up the value chain and to tap new markets.
• Benefits of the TEE Scheme:

Recognition-

• Helps in getting recognition/credibility attached to industrial units of the region/town while exploring/expanding into newer markets.
• Puts such industrial units/town on the global stage.

Market Access Initiative (MAI) Scheme-

• Recognized associations of units are provided financial assistance under MAI Scheme on priority basis, for export promotion projects for marketing, capacity building, and technological services.
• Through this scheme such units can get financial assistance to visit various trade exhibitions/fairs for exploring more marketing avenues.

Common Service Provider Facility-

• Common Service Providers in TEE are entitled for Authorisation under EPCG Scheme which can help in increasing the competitiveness of the cluster and provide enabling environment.
• This arrangement gives facility to exporters to not own all the infrastructure for conversion from inputs to final export products.

• Districts as Export Hubs Initiative
  • States and Districts as Partners in Export Promotion

    Districts as Export Hubs aims to/for:

    • Boost India's foreign trade by decentralizing export promotion.
    • Bring a greater level of awareness and commitment regarding exports at the district level.
    • Identification of products/services in all the districts.
    • Create institutional mechanisms at the State and District level to strategize exports (State Export Promotion Committee & District Export Promotion Committee).
    • Preparation of District Export Action Plans (DEAPs) outlining the action plan to promote identified products and services.
    • Make States and Districts meaningful stakeholders and active participants.

• Capacity Building at District level
  • Capacity building to create new exporters and identification of new markets.
  • Training, handholding, and outreach programs by DGFT field offices in coordination with District Industries Centres.
  • Regional Authorities of DGFT working with the States/UTs to prepare District specific Export Plans.
  • Export promotion outreach programs in districts to focus on branding, packaging, design, and marketing of identified product and services.

• Infrastructure and Logistics Development Intervention
  • To address Infrastructure and Logistics bottlenecks impeding exports.
  • Districts to focus on development of logistics, testing facilities, connectivity for exports, and other export-oriented ecosystem.
  • Convergence of ongoing schemes to support these initiatives.

• E-Commerce Exports
  • Facilitation for E-Commerce Exports
    • All FTP benefits to be extended to e-commerce exports.
    • Necessary enablement of IT systems in Department of Commerce, Post, CBIC to be undertaken in six months.
    • Guidelines are being formulated in consultation with other ministries to facilitate further exports under e-commerce.
    • Special outreach and training activities for small e-commerce exporters.
    • The value limit for exports through courier service is increased from US$ 6,056.31 (Rs. 5 lakh) to US$ 12,112.62 (Rs. 10 lakh) per consignment.

• Dak Niryat Facilitation
  • Dak Ghar Niryat Kendras shall be operationalised throughout the country to work in a hub-and-spoke model with Foreign Post Offices (FPOs) to facilitate cross-border e-commerce and to enable artisans, weavers, craftsmen, and MSMEs in the hinterland and land-locked regions to reach international markets.

• E-Commerce Export Hubs
  • Designated hubs with warehousing facility to be notified, to help e-commerce aggregators for easy stocking, customs clearance, and returns processing.
  • Processing facility to be allowed for last mile activities such as labelling, testing, repackaging etc.

• Steps to Boost Manufacturing
  • Prime Minister Mega Integrated Textile Region and Apparel Parks (PM MITRA) scheme has been added as an additional scheme eligible to claim benefits under Common Service Provider (CSP) Scheme of Export Promotion Capital Goods Scheme (EPCG).
  • Dairy sector to be exempted from maintaining Average Export Obligation, in order to support dairy sector to upgrade the technology.
  • Battery Electric Vehicles (BEV) of all types, Vertical Farming equipment, Wastewater Treatment and Recycling, Rainwater Harvesting System, Rainwater Filters, and Green Hydrogen are added to Green Technology products. These will now be eligible for reduced Export Obligation requirement under the EPCG Scheme.
  • Special Advance Authorisation Scheme has been extended for the export of Apparel and Clothing to facilitate prompt execution of export orders. The norms would be fixed within a fixed time-frame.
  • Benefits of Self-Ratification Scheme for fixation of Input-Output Norms extended to two-star and above status holders in addition to Authorised Economic Operators at present.
  • Fruits and Vegetables exporters are being included for double weightage for counting export performance under eligibility criteria for Status House certification. This is in addition to existing MSME sector who also get double weightage.

• Special one-time Amnesty Scheme for default in Export Obligations
  • Government is strongly committed to reducing litigation and fostering trust-based relationships to help alleviate issues faced by exporters.
  • In line with the ‘Vivaad se Vishwaas’ initiative, which sought to settle tax disputes amicably, Government is introducing a special one-time Amnesty Scheme to address non-compliance in Export Obligations by Advance Authorization and EPCG authorization holders.
  • All pending cases of default in Export Obligation (EO) of authorizations mentioned can be regularized by the authorization holder on payment of all custom duties exempted in proportion to unfulfilled Export Obligation and maximum interest is capped at 100% of such duties exempted under this scheme. However, no interest is payable on the portion of Additional Customs Duty and Special Additional Customs Duty.
  • Amnesty scheme shall be available for a limited period, up to September 30, 2023.

• Emphasis on streamlining SCOMET Licensing Procedure
  • The focus of FTP 2023 is on a policy for export of dual use items under Special Chemicals, Organisms, Materials, Equipment, and Technologies (SCOMET) consolidated at one place for ease of understanding and compliance by industry.
  • SCOMET policy emphasizes India’s export control in line with its International commitments under various export control regimes (Wassenaar arrangement, Australia group, and Missile Technology Control Regime) to control trade in sensitive and dual use items including software and technology.
  • Recent policy changes introduced such as general authorizations for export of certain SCOMET items to streamline licensing of these items to make export of SCOMET items globally competitive.
  • Focus on simplifying policies to facilitate export of dual-use high-end goods/technology such as UAV/Drones, Cryogenic Tanks, certain chemicals etc.