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CA SANDEEP KHANDELWAL
IEC code (export import code)
India’s Foreign Trade Policy is a comprehensive set of guidelines and measures implemented by the government to promote exports, facilitate imports, and boost the country’s overall economic growth. India’s Foreign Trade Policy aims to create an enabling environment for trade and investment and promote India’s exports globally while providing a level playing field to domestic industries. Here are some of the salient features of India’s Foreign Trade Policy:
Exports Promotion: The primary objective of India’s Foreign Trade Policy is to promote exports by providing various incentives and benefits to exporters. It includes schemes such as Merchandise Export from India Scheme (MEIS), Service Export from India Scheme (SEIS), and Export Promotion Capital Goods (EPCG) scheme.
Trade Facilitation: The policy aims to streamline trade procedures and simplify customs clearance to reduce transaction costs and enhance efficiency. The government has implemented the Electronic Data Interchange (EDI) system for the seamless exchange of trade-related information between traders and customs officials.
Special Economic Zones: The policy encourages the development of Special Economic Zones (SEZs) to boost exports and attract foreign investment. SEZs offer various benefits, including tax holidays, duty-free imports, and streamlined procedures.
Import Promotion: The policy also focuses on import promotion to facilitate the import of goods required for domestic consumption and industrial production. The government has simplified procedures for the import of capital goods, raw materials, and components.
Trade with neighboring countries: The policy promotes trade with neighboring countries through various initiatives such as the South Asian Free Trade Area (SAFTA) and the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC).
Focus on MSMEs: The policy aims to enhance the competitiveness of Micro, Small, and Medium Enterprises (MSMEs) by providing them with various incentives, including a 3% interest subvention on pre-shipment and post-shipment credit.
E-commerce Exports: The policy recognizes the importance of e-commerce in promoting exports and has introduced several measures to promote e-commerce exports, including the e-commerce platform for exporters and the e-Marketplace portal.
Here are some of the incentives provided under the policy:
Merchandise Export from India Scheme (MEIS): MEIS provides incentives to exporters of goods based on their export turnover. The scheme aims to enhance the competitiveness of Indian exports in the global market.
Service Export from India Scheme (SEIS): SEIS provides incentives to service exporters based on their net foreign exchange earnings. The scheme covers a wide range of services, including professional services, research and development, and tourism.
Export Promotion Capital Goods (EPCG) Scheme: EPCG allows import of capital goods at zero or concessional duty for the production of goods meant for export. The scheme aims to facilitate the acquisition of capital goods for enhancing production and exports.
Duty-Free Import Authorization (DFIA) Scheme: DFIA allows duty-free import of inputs for the production of goods meant for export. The scheme aims to enhance the competitiveness of Indian exports by reducing input costs.
Employment Generation Scheme (EGS): EGS provides incentives to labour-intensive sectors such as textiles, handicrafts, and leather for the generation of additional employment. The scheme aims to promote exports while generating employment opportunities.
Interest Equalization Scheme: The scheme provides interest subvention of 3% to exporters on pre-shipment and post-shipment credit. The scheme aims to enhance the competitiveness of Indian exports by reducing the cost of credit.
Market Access Initiative (MAI): MAI provides support to Indian exporters to participate in trade fairs, exhibitions, and buyer-seller meets in foreign countries. The scheme aims to promote Indian exports and enhance market access.
Foreign Trade Agreements (FTAs): India has signed FTAs with several countries to enhance market access and promote exports. The FTAs provide various benefits, including reduced or eliminated tariffs on exports and imports.
How Can MNRS Help?
We at MNRS can help you identify relevant foreign trade policy provisions having bearing on your business. We can also assist you in applying for various government scheme and incentives and assist you in resolving disputes arising during the course of international trade. To summarise MNRS can help you in:
- Applying for registration for IEC code on priority.
- Advising on various incentives schemes notified under Foreign Trade Policy and filing application with respective government agencies for grant of incentives.
- Filing claim for reimbursement of expenditures incurred for participation in overseas exhibitions meant for promoting Indian Exports.
- Advising exporters on securing concessional pre-shipment and post-shipment finance enabling them to become more competitive with the aim to facilitate exports.
- Applying for “Duty-Free Import Authorisation” to facilitate import of input goods without payment of duty, to be used for the production of goods meant for export.
- Advisory for maximum utilization of the benefits provided by the DGFT.
- Advisory as to ensuring regulatory compliance w.r.t. various scheme such as DFIA, EPCG, MAI etc.