INDIA's FOREIGN TRADE POLICY 2009-14 -- HIGHLIGHTS-VRK100-10112009

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India’s Commerce Minister Anand Sharma, on August 27, 2009, announced India’s Foreign Trade Policy for 2009-14. The following are the highlights of the new Foreign Trade Policy (FTP):

Ø      Govt to continue tax refund scheme for exporters until December 2010

Ø      Widens scope for products to be included for benefits under Focus Product Scheme (FPS). Additional engineering products, plastic and some electronics get a look in. Incentives under FPS raised from 1.25% to 2%.

Ø      Twenty-six new markets have been added under Focus Market Scheme (FMS). Incentive available under FMS raised from 2.5 per cent to 3 per cent.

Ø      To aid technological upgradation of export sector, EPCG Scheme at Zero Duty has been introduced

Ø      Taking into account the decline in exports, the facility of Re-fixation of Annual Average Export Obligation for a particular financial year in which there is decline in exports from the country, has been extended for the 5-year Policy period 2009-14. support for Green products and products from North East

Ø      To impart stability to the Policy regime, Duty Entitlement Passbook (DEPB) Scheme is extended beyond 31.12.2009 till 31.12.2010

Ø      To neutralize duty incidence on gold jewellery exports, it has now been decided to allow Duty Drawback on such exports

Ø      To reduce transaction and handling costs, a single window system to facilitate export of perishable agricultural produce has been introduced

Ø      To simplify claims under FPS, requirement of “Handloom Mark’ for availing benefits under FPS has been removed

Ø      Income tax expemption to 100% EOUs and to STPI units under Section 10B and 10A of Income Tax Act has been extended for the financial year 2010-11 in the Budget 2009-10

Ø      In order to make India World’s diamond hub, it’s planned to establish Diamond Bourses

Ø      EOUs have been allowed to sell products manufactured by the in DTA (domestic tariff area) up to a limit of 90 per cent instead of existing 75 per cent, without changing the criteria of ‘similar goods’, within the overall entitlement of 50 per cent for DTA sale

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