With the new approach of tax remission instead of incentives; greater trade facilitation through technology, automation, and continuous process re-engineering; export promotion through collaboration; and focus on emerging areas like e-commerce exports, developing districts as export hubs, streamlining SCOMET policy, etc., the Indian Ministry of Commerce and Industry, has on 31 March 2023 unveiled Foreign Trade Policy 2023. Certain highlights of the new Policy which is effective from 1 April 2023 are provided below.
- The new Policy will continue till its withdrawn. That is, the new Policy has no usual sunset clause of 5 years, as was being provided till now.
- All authorisation redemption applications will be paperless.
- Export performance threshold for recognition of exporters as Status Holders has been rationalized, thus enabling more exporters to achieve higher status.
- Four new towns of export excellence declared – Faridabad for apparel, Moradabad for handicrafts, Mirzapur for handmade carpet and dari, and Varanasi for handloom and handicraft.
- Districts as export hubs initiative has been introduced with the aim to boost India's foreign trade by decentralizing export promotion. The initiative involves identification of products/services in all the districts, and creation of institutional mechanisms at the State and District level to strategize exports.
- All FTP benefits to be extended to e-Commerce exports.
- Value limit for exports through courier has been increased to INR 10,00,000 per consignment.
- Processing time to be reduced to one day for approval of applications under automatic route for exporters, for advance authorisation, EPCG issuance, and for revalidation of authorisations and extension of export obligation period.
- Application fee is to be reduced for advance authorization and EPCG schemes, for MSMEs.
- Dairy sector has been exempted from maintaining average Export Obligation under EPCG scheme.
- Amnesty scheme for one time settlement of default in export obligation by Advance and EPCG authorisation holders, has been introduced. The scheme will be available for a limited period, up to 30 September 2023. It may be noted that only authorisations issued under FTP 2009-14 till 31 March 2015, and those issued under FTP 2004-2009 or before where the export obligation period was valid beyond 12 August 2013, will only be eligible for the scheme. According to Public Notice No. 2/2023, dated 1 April 2023, all defaults can be regularised by payment of all customs duties and 100% interest on such duties. No interest is however payable on the portion of Additional Customs duty and Special Additional Customs duty.
- Policy for export of dual use items under SCOMET has been consolidated at one place for ease of understanding and compliance by the industry.
