Exports fall sharply, new foreign trade policy's a fix
India's merchandise exports had fallen short of the target set for 2008-09
New Delhi: India's new Foreign Trade Policy was unveiled on Thursday with a mix of fiscal sops and procedural reforms in a bid to reverse 10 consecutive months of decline in merchandise exports and ensuring healthy growth of out-bound shipments.
The continuation of the popular duty-free export promotion scheme till end-2010, special sops for labour-intensive sectors and zero duty on capital goods import were some of the highlights of the policy unveiled by Commerce Minister Anand Sharma in New Delhi.
"My immediate priority is to arrest and reverse the declining trend in exports," he told the representatives of various export promotion councils and industry chambers at the Pragati Maidan trade and convention centre in the national capital.
The minister also set an export target of $200 billion for 2010-11 with a growth of 15 per cent over the next two years, with an overall medium-term objective of 25 per cent annual growth thereafter.
India's merchandise exports had fallen short of the target set for 2008-09 and were valued at $168.7 billion, up merely 3.4 per cent over $163.13 billion in the year before. Exports were also down 31.3 per cent in the first quarter of this fiscal.
Nevertheless, Sharma said, India's share of global goods and services exports now stood at 1.53 per cent, as opposed to 0.92 per cent in 2003, while its share of global merchandise export was at 1.28 per cent.
Highlights of India's new Foreign Trade Policy:
Following are the highlights of the new Foreign Trade Policy that was unveiled by Commerce Minister Anand Sharma in New Delhi on Thursday:
- Duty entitlement passbook scheme extended till December 2010
- Extension of sops for export-oriented units till March 2011
- Export target of $200 billion set for 2010-11
- Growth target of 15 percent for next two years, 25 percent thereafter
- Inter-ministerial group to address issues raised by exporters
- Obligation under export promotion capital goods scheme relaxed
- Permission for tax refund scheme for jewellery sector
- No fee on grant of incentives to cut transaction costs
- Steps to help exporters reduce transaction costs
- Plan for diamond bourses in the country
- Single-window scheme for farm exports
- Re-export of unused leather allowed subject to 50 percent duty
- Minimum value addition for tea reduced to 50 percent from 100 percent
- Export units allowed to sell 90 percent of goods in domestic market
- Provision for state-run banks to provide dollar credits
- Twenty-six new markets added to focus market scheme
- Sops under focus market scheme hiked from 2.5 percent to 3 percent
- Number of duty-free samples for exporters raised to 50 pieces from 15
- New directorate of trade remedy measures to be set up
- Zero duty under technology upgrade scheme