Launching the policy Union Minister of Commerce and Industry, Textiles, Piyush Goyal said that We will achieve US $ 2 trillion in exports by 2030, but we should ensure merchandise exports don’t fall behind services exports.
India’s overall exports have already crossed US $ 750 Billion and are expected to cross US $ 760 Billion this year.
The policy also has a Special advance authorisation scheme extended for the apparel sector.
The policy aim of boosting India’s exports to US $ 2 trillion by 2030 and it comes into effect on April 1, 2023. FTP 2023 has no end date and is to be modified as per need.
FTP 2023 outlines the intent and roadmap for establishing e-commerce hubs and related elements such as payment reconciliation, bookkeeping, returns policy, and export entitlements. As a starting point, the consignment-wise cap on E-Commerce exports through courier has been raised from Rs. 5 Lakh to Rs. 10 Lakh in the FTP 2023.
The EPCG Scheme, which allows the import of capital goods at zero Customs duty for export production, is being further rationalized. Some key changes being added are: Prime Minister Mega Integrated Textile Region and Apparel Parks (PM MITRA) scheme has been added as an additional scheme eligible to claim benefits under CSP (Common Service Provider) Scheme of Export Promotion Capital Goods Scheme (EPCG).
The key approach to the policy is based on these 4 pillars:(i) Incentive to Remission, (ii) Export promotion through collaboration – Exporters, States, Districts, Indian Missions, (iii) Ease of doing business, reduction in transaction cost and e-initiatives and (iv) Emerging Areas – E-Commerce Developing Districts as Export Hubs and streamlining SCOMET policy.
It encourages recognition of new towns through ‘Towns of Export Excellence Scheme’ (TEE) and exporters through ‘Status Holder Scheme’. Four new towns, namely Faridabad, Mirzapur, Moradabad, and Varanasi, have been designated as TEE in addition to the existing 39 towns. The TEEs will have priority access to export promotion funds under the MAI scheme and will be able to avail Common Service Provider (CSP) benefits for export fulfillment under the EPCG Scheme. This addition is expected to boost the exports of handlooms, handicrafts, and carpets.
The government has introduced a special one-time Amnesty Scheme under the FTP 2023 to address default on Export Obligations. This scheme is intended to provide relief to exporters who have been unable to meet their obligations under EPCG and Advance Authorizations, and who are burdened by high duty and interest costs associated with pending cases. All pending cases of the default in meeting Export Obligation (EO) of authorizations mentioned can be regularized on payment of all customs duties that were exempted in proportion to unfulfilled Export Obligation. The interest payable is capped at 100 per cent of these exempted duties under this scheme. However, no interest is payable on the portion of Additional Customs Duty and Special Additional Customs Duty and this is likely to provide relief to exporters as interest burden will come down substantially.
Some of the interesting points of the FTP 2023
- Reduction in fee structures and IT-based schemes will make it easier for MSMEs and others to access export benefits.
- Duty exemption schemes for export production will now be implemented through Regional Offices in a rule-based IT system environment, eliminating the need for a 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.
- Exporter firms recognized with ‘status’ based on export performance will now be partners in capacity-building initiatives on a best-endeavor basis. Similar to the ‘each one teach one’ initiative, 2-star and above status holders would be encouraged to provide trade-related training based on a model curriculum to interested individuals. Status recognition norms have been re-calibrated to enable more exporting firms to achieve 4 and 5-star ratings, leading to better branding opportunities in export markets.
