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Current Affairs 2023
The Indian government launched the Foreign Trade Policy 2023 to increase India's exports to 2 trillion dollars by 2030. The policy is based on four pillars, including incentive to remission, ease of doing business, export promotion through collaboration, and emerging areas. The policy emphasizes export promotion and development through technology interface and collaboration, moving away from an incentive regime.
Apr 03, 2023
3 min read
The Indian government recently launched the Foreign Trade Policy 2023, with the aim of taking India's exports to 2 trillion dollars by 2030. The Union Minister of Commerce and Industry, Consumer Affairs, Food and Public Distribution and Textiles, Shri Piyush Goyal, stated that the policy is dynamic and has been kept open-ended to accommodate the emerging needs of the time. The policy has been formulated after multiple stakeholder consultations, and the key approach is based on four pillars: Incentive to Remission, Export promotion through collaboration, Ease of doing business, and Emerging Areas.
The Minister referred to the interaction that Prime Minister, Shri Narendra Modi, had with the exporters on 6th August 2021, where he encouraged them to increase exports and get more deeply involved in the global value chain. He lauded the vision and guidance of the Prime Minister who believed that given the size of the Indian economy and manufacturing & service sector base, the potential for the country to grow is manifold. He said that this vision is at the core of the policy.
The policy emphasizes export promotion and development, moving away from an incentive regime to a regime which is facilitating, based on technology interface and principles of collaboration. Duty exemption schemes for export production will now be implemented through Regional Offices in a rule-based IT system environment, eliminating the need for manual interface. During the FY23-24, all processes under the Advance and EPCG Schemes, including issue, re-validation, and EO extension, will be covered in a phased manner.
The FTP 2023 encourages recognition of new towns through the "Towns of Export Excellence Scheme" and exporters through the "Status Holder Scheme". Four new towns, namely Faridabad, Mirzapur, Moradabad, and Varanasi, have been designated as Towns of Export Excellence (TEE) in addition to the existing 39 towns. The TEE scheme is intended to identify and develop specific towns as hubs for exports of specific products, as per their comparative advantage. The Status Holder Scheme, on the other hand, recognizes the contribution of exporters to India's foreign trade and offers various benefits, including exemption from certain procedural requirements, faster clearance of goods, and access to government-funded research and development schemes.
The new FTP is introducing a one-time Amnesty Scheme for exporters to close old pending authorizations and start afresh. This will enable exporters to take advantage of new schemes and procedures under the FTP 2023, and also streamline the process for exporters. The policy also focuses on emerging areas like dual-use high-end technology items under SCOMET, facilitating e-commerce export, collaborating with States and Districts for export promotion.
Greater faith is being reposed on exporters through automated IT systems with a risk management system for various approvals in the new FTP. FTP 2023 codifies implementation mechanisms in a paperless, online environment, building on earlier 'ease of doing business' initiatives. Reduction in fee structures and IT-based schemes will make it easier for MSMEs and others to access export benefits.
In conclusion, the Foreign Trade Policy 2023 is a comprehensive document that aims to facilitate ease of doing business for exporters and streamline the export process. The policy focuses on collaboration, automation, and emerging areas like e-commerce and dual-use high-end technology items. The policy is a step towards achieving India's goal of becoming a 5 trillion dollar economy by 2025 and taking India's exports to 2 trillion dollars by 2030. The government's continued support for the export sector will undoubtedly play a crucial role in driving the Indian economy towards sustained growth and development.
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