Presentation on Foreign Trade Policy 2004-09

1
Presentation
on Foreign Trade Policy 2004-09
2
Objective- Facilitate sustained growth in
exports to attain a share of atleast 1.5 of
global merchandise trade. Present share -
0.67 Export target (2006-07)- 85 b .
Present Annual growth rate(CAGR) -11.9
3
New Export Target Target- 1.5 of the
International Trade CAGR Required- 15.18 (in
US terms) Assumption- World Trade Growth _at_
4.5 (2003 rate)
4
Objectives (Contd.) Facilitating high share
of Indian Goods and Services in the
International market Act as Instrument of
Economic Growth, Employment Generation and
Poverty Alleviation Reflect the priorities
for development of the Indian Economy
5
STRATEGY TO ACHIEVE THE OBJECTIVES

• Bring down transaction cost Simplified
  procedure,
• Unshackling of controls, built-in transparency
  
• mutual trust
• India to be a Global hub for Manufacturing,
  Trading
• Services
• Special Focus area Initiatives
• Facilitating Technological Infra-structural
  upgradation
• Neutralising incidence of all levies duties
  on inputs
• Duties Levies should not be exported.

6

• Thrust Sectors Agricultural
  Handicrafts Handlooms Gems and
  Jewellery Leather Textile

7
Digital automation targetAll Export
transactions would be through EDI mode by 31st
October, 2005 Digital Signature and EFT
facility operational
8
Indias Foreign Trade
Period - Growth Rate
1999-2000 10.85
2000-2001 21.01
2001-2002 -1.65
2002-2003 20.34
2003-2004 17.26
9
Incorporating a legal entity Proprietorship
In India ROC Partnership
Concern
Trade Licence
State
DepartmentsPermanent Acccount Number
Bank Certificate PAN by Income
Tax Dept. from the concerned Bank  

Importer-Exporter Code NumberDGFT 
EXPORTS IMPORTS
Nature of
Restriction
ITCHS Classification  Free List items
Negative List Prohibited
Restricted Canalized
10
Export Incentives(DOC)
INFRA- STRUCTURE Related Sops
TOWNS OF EXPORT EXCELLENCE
ASIDE SCHEME
Duty exemptions Under Customs Notif. 21/2002
Misc.Incentives Such as DFEC, Target Plus, Addl.
weightage
Additional incentives Linked with Exports
Post- export
CENTRAL DUTY REFUND/ NEUTRALISATION/ EXEMPTION
SCHEMES
Pre- export
MDA Grant
MAI Grant
Market Development Initiatives
11

• CENTRAL DUTIES
• CUSTOMS DUTYBasic, Addl(CVD), E.Cess,
• Anti-dumping, Safeguard
  duties etc.
• EXCISE DUTY--- Basic, Addl etc.
• EXPORT CESS
• CENTRAL SALES TAX
• INCOME TAX
• SERVICE TAX
• OTHERS
• ELECTRICITY DUTY, OCTROI, SALES TAX etc.

12
SCHEMES

• SEZ Scheme
• EOU/EHTP/STP/BTP Schemes
• EPIP Scheme
• Warehousing Scheme
• CCP
• DTA Schemes

13
DTA SCHEMES
Post-Export
Pre-Export

1. DFRC, 2. DEPB, 3.REP
2. DRAWBACKPhy D.E.
3. TED Refund
4. Target Plus
5. DFEC for Service Sec
6. Vishesh Krishi Upaj Yojana

1. ADVANCE LIC.
2. EPCG

14
Physical (out of India/Supply to SEZ)
(Against Indian Rupees or Free foreign
Exchange) EXPORTS Supply within the
country(Deemed) (In Indian Rupees or Free
Foreign ExchangeEEFC)Exporters-- Physical Vs
Merchant
15
ADVANCE LICENCE SCHEME X----------?Y-------
-?Z1. PHYSICAL EXPORT -- Duty free import of
Inputs, Fuel, Oil, Energy, Catalyst
etc. -- V.A.AU condition Norm fixed No
Norm cases Imports Exports valid
upto 24 months Further extn allowed
-- Supply to SEZ units also covered --
E.O. discharge based on S/Bs BRC
(Irrevocable L/C , Provision of Avalisation,
co-acceptance also available)
16
2. Advance Licence (Intermediate Supply) --
For supplies to Advance licence for physical
exports Alternatively direct Physical Exports
also allowed -- Duty free import of
Inputs, Fuel, Oil,Energy, Catalyst etc.
-- V.A.AU condition Norm fixed No Norm
cases Imports Exports valid upto 24 months
Further extn allowed -- E.O.
discharge based on S/Bs Bank certificate
(Irrevocable inland L/C , Provision of
Avalisation, co-acceptance also
available)
17
3. Advance Licence (Deemed Export) -- For
supplies within India under various
projects, supplies to EOU/EHTP/STP/BTP -- Duty
free import of Inputs, Fuel, Oil, Energy,
Catalyst etc. -- V.A.AU condition Norm fixed
No Norm cases Imports Exports valid
upto 24 months or co-terminus with the
project Extn allowed -- E.O. discharge based on
S/Bs Bank certificate (Irrevocable inland
L/C, Provision of Avalisation,
co-acceptance also available) -- Anti-dumping
Safeguard duty not exempted except supplies
to EOU/EHTP/STP/BTP
18
EPCG Scheme--Import of capital
goods with AU condition at concessional rate
of 5 duty for pre-production, Production
Post production purposes related to export
(Both Physical deemed)Import of Car-- E.O. 8
times the duty saved in 8 years 12 Years--
E.O. monitoring in two blocks only -- Special
Dispensation for licence with duty saved of
Rs 100 crores or above, Agro units, SSI units,
BIFR. E.O. period 12 years and varied
/reduced E.O.-- EPCG licence for project
importReduced E.O.-- Export of alternate
product/services allowed-- Special package for
agro units in the AEZ
19
DFRC SCHEME--Post export scheme
based on S/B (Bill of Export) and BRC Both
against Phy. Deemed exports--Min. 25 V.A.,
SION based, Certain sensitive items with
technical specification allowed--Freely
transferable certificate However DFRC with AU
condition also available24 months valid --Fuel
allowed to be transferred to marketing
agencies authorised by Ministry of
PNG--Facility of CENVAT credit or
drawback--Only basic customs duty exemption at
the time of imports
20
4.DEPB SCHEME --Post export scheme
based on S/B (Bill of Export) and BRC Freely
transferable unless specified-- Supplies to SEZ
units also elligible--Based on basic customs
duty on inputs--Filing of application and late
cut--CENVAT credit or drawback available--Any
item including CG (freely importable) allowed
for import--Valid for 24 months
21
TARGET PLUS SCHEME--- For Star Export
Houses-- Duty credit based on Incremental
exports(fob value in free foreign exchange)
subject to a minimum export turnover of Rs
10 crores in the previous year-- Entitlement
1. gt20 lt25 5 gt25 lt100
10 gt100
15(Based on max. 100growth) 2. Restrictions on
export turnover calculation 3. Imports
allowed-- CENVAT credit or DBK allowed for the
CVD paid/debited
22
SERVICE EXPORTS-- For
161 Tradable services-- New Export Promotion
Council for Services-- DFEC for Serve from India
Scheme 1. Eligibility -- Min.FFE of
Rs 10 Lakhs in the preceding or current
financial year (Exception Rs 5 Lakhs for
individuals) -- Categories of exports
excluded for entitlement 2. Entitlement
Hotels of one star above
5 Stand alone Restaurants
20 All
other service providers
10 3. Imports allowed -- With
AU condition -- Any CAPITAL GOODS, Office
Equipments, Furnitures and
consumables etc -- No Agricultural
Product except food items and beverages for
the Hotels and Restaurants
23
VISHESH KRISHI UPAJ YOJANA--A new scheme
christened as the Vishesh Krishi Upaj Yojana to
boost exports of specified agricultural
products. 1. Duty credit
entitlement of 5 of FOB value of Exports.
2. Exports of fruits, vegetables,
flowers, minor forest produce
and their value added variants 3.
Freely transferable 4. Imports of
inputs and capital goods permitted.
5.CENVAT credit or DBK allowed for the CVD
--Import of capital goods shall be permitted
duty free under the EPCG Scheme --Units
in Agri Export Zones (AEZ) shall be exempt from
BG under the EPCG Scheme -- Import of inputs
such as pesticides shall be permitted under the
Advance Licence for agro exports. --Capital
goods imported under EPCG permitted to be
installed anywhere in the AEZ
24
STATUS CERTIFICATES--One star to Five
Star Export House-- Double weightage for certain
categories-- Special Privileges
25
THANKS