Export Import Policy Export Clearance

Presented by: Ranjita (151)

Introduction:

The Govt. of India, Ministry of Commerce and Industry

announces Export Import Policy every five years. Current policy - 2009-2014. The Export Import Policy (EXIM Policy) is updated every year on the 31st of March and the modifications,

improvements and new schemes are effective w.e.f. 1st

April of every year.

27th August 2009 Key Objective: Arrest the declining exports and reverse the trend. A multipronged strategy was adopted to provide stability of policy supporting employment intensive sectors. Market diversification strategy under pinned our approach to reach out to non-traditional destinations in Africa, Latin America and Asia.

Targets
1.
2.

Export Target : $ 200 Billion for 2010-11

Export Growth Target : 15 % for next two years and 25 % there after.

EPCG Scheme
1.
2.

Obligation under EPCG scheme relaxed.

To aid technological up gradation of export sector, EPCG Scheme at Zero Duty has been introduced.

3.

Export obligation on import of spares, moulds etc. under EPCG Scheme has been
reduced by 50%.

Refixation of Annual Average Export Obligation:

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 extended.

Highlights of the Annual Supplement 2010-11 to the Foreign Trade Policy 2009-14 Announcements for FPS, FMS, MLFPS
5. Additional Duty Credit Scrips shall be given to Status Holders @ 1% of the FOB 1. Market Linked Focus Product Scheme (MLFPS) expanded by inclusion of products

value of past exports to accelerate exports and encourage technological upgradation. like pharmaceuticals, textile fabrics, rubber products, glass products, auto
2. This facility shall be available for sectors of leather (However , finished leather), components, motor cars, bicycle and its parts.etc. (excluding benefits to these textiles and jute, be provided, if exports are (excluding Iron & steel & non-ferrous products will handicrafts, engineering made to 13 identified markets (Algeria,

metals in primaryNigeria, South Africa, Tanzania, Brazil, Mexico, Ukraine, Vietnam, Egypt, Kenya, and intermediate form, automobiles & two wheelers, nuclear
reactors & parts, and ships, boats and floating structures), plastics and basic Cambodia, Australia and New Zealand). 6. Focus Product Scheme benefit extended for export of green products and some chemicals (excluding pharma products). 3. Available up to 31 March, 2011. products from the North East. 7. A common simplified Duty Credit scrips being issued to status apply under 4. Transferability for the application form has been introduced to holdersfor the VKGUY Scheme permitted only for the procurement of cold chain equipments. benefits under FPS, FMS, MLFPS and VKGUY.

Highlights of the Annual Supplement 2010-11 to the Foreign Trade Policy 2009-14 Announcements for MDA & MAI
Higher allocation for Market Development Assistance (MDA) and Market Access Initiative (MAI) has been announced.

Towns of Export Excellence (TEE)

The following cities have been recognized as towns of export excellence (TEE) 1. Handicrafts : Jaipur, Srinagar and Anantnag 2. Leather Products : Kanpur,Dewas and Ambur 3. Horticultural Products: Malihabad

Scheme for Status Holders (Status Holders means star status holders)
1. Additional Duty Credit Scrips shall be given to Status Holders @ 1% of the FOB

value of past exports accelerate exports and encourage technological upgradation.

2. This facility shall be available for sectors of leather (excluding finished leather), textiles and jute, handicrafts, engineering (excluding Iron & steel & non-ferrous metals in primary and intermediate form, automobiles & two wheelers, nuclear reactors & parts, and ships, boats and floating structures), plastics and basic chemicals (excluding pharma products). 3. This facility shall be available up to 31 March, 2011. 4. Transferability for the Duty Credit scrips being issued to status holders under VKGUY Scheme permitted only for the procurement of cold chain equipments.

Extension of Income Tax Exemption to EOU and STPI :

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

Extension of ECGC :
The adjustment assistance scheme initiated in December, 2008 to provide enhanced ECGC cover at 95%, to the adversely affected sectors, is continued till March, 2010.

Announcements For Marine sector :

1. Fisheries exempted from maintenance of average EO under EPCG Scheme (along with 7 sectors) however Fishing Trawlers, boats, ships and other similar items shall not be allowed for this exemption.

2. Additional flexibility under Target Plus Scheme (TPS) / Duty Free Certificate of
Entitlement (DFCE) Scheme for the marine sector.

Highlights of the Annual Supplement 2010-11 to the Foreign Trade

Policy 2009-14

Announcements for Gems & Jewellery Sector:

1. Duty Drawback is allowed on Gold Jewellery exports to neutralize duty incidence. 2. Plan to establish "Diamond Bourse (s) with an aim to make India and International Trading Hub announced. 3. Introduction of a new facility to allow import on consignment basis of cut & polished diamonds for the purpose of grading/ certification. 4. 13 value limits of personal carriage have been increased from $ 2 million to US$ 5 million in case of participation in overseas exhibitions. 5. The limit in case of personal carriage, as samples, for export promotion tours, has also been increased from US$ 0.1 million to US$ 1 million. 6. Time limit of 60 days for re-import of exported gems and jewellery items, for participation in exhibitions has been extended to 90 days in case of USA.

Announcements for Agro Exports:

1. Introduction of a single window system to facilitate export of perishable agricultural produce with an aim to reduce transaction and handling cost. 2. This system will involve creation of multi-functional nodal agencies. These agencies will be accredited by APEDA.

Announcements for Leather Exports

On the payment of 50 % applicable export duty, Leather sector shall be allowed reexport of unsold imported raw hides and skins and semi finished leather from public bonded ware houses.

Announcements for Tea Exports:

1. The existing Minimum value addition under advance authorisation scheme for
export of tea is 100 %. It has been reduced from the existing 100% to 50%. 2. DTA (Domestic Tarriff Area) sale limit of instant tea by EOU units increased from 30% to 50%. 3. Export of tea has been included under VKGUY Scheme benefits.

Announcements for Pharma Exports :

1. Export Obligation Period for advance authorizations issued increased from existing 6 months to 36 months. 2. Pharma sector included under MLFPS for countries in Africa and Latin America & some countries in Oceania and Far East.

Announcements for Handloom Exports:

The claims under Focus Product Scheme, the requirement of " Handloom mark" was
required earlier. This has been removed.

Scheme for Export Oriented Units:

1. EOUs have been allowed to sell products manufactured by them in DTA (Domestic Tariff Area) upto a limit of 90% instead of existing 75%, without changing the criteria of similar goods, within the overall entitlement of 50% for DTA sale. (This means that instead of 75% these units can sell up to 90 % of their products in the domestic markets) 2. EOU allowed to procure finished goods for consolidation along with their manufactured goods, subject to certain safeguards. 3. Extension of block period by one year for calculation of Net Foreign Exchange earning of EOUs kept under consideration. 4. EOU allowed CENVAT Credit Facility.

Announcements for Value Added Manufacturing (VAM)

To encourage Value Added Manufactured export, a minimum 15% value addition on
imported inputs under Advance Authorization Scheme.

Announcements for Project Exports

Project Exports and a large number of manufactured goods covered under FPS and MLFPS.

Fuel included in DEPB Scheme:

Custom duty component on fuel where fuel is allowed as a consumable in Standard Input-Output Norm included in factoring.

Easy Import of samples:

Number of sample pieces has been increased from the existing 15 to 50. This will facilitate the the duty free import of samples by exporters.

Reduction in Transaction Costs: Convertibility of Shipping Bills

1. Dispatch of imported goods directly allow conversion of site has been allowed Greater flexibility has been permitted tofrom the Port to theShipping Bills from one
under Promotion scheme scheme scheme. supplies. (Presently permit this Export Advance Authorisationto otherfor deemedCustoms shall now the duty free imported goods could be taken only to the the present limited period of only one conversion within three months, instead ofmanufacturing unit of the authorisation holder month.or its supporting manufacturer. 2. Maximum applicable fee for 18 Authorisations/ licence applications (except some as mentioned in FTP) has been reduced to Rs. 100,000 from the existing Rs 1,50,000 (for manual applications) and Rs. 50,000 from the existing Rs.75,000 (for EDI applications). 3. No fee shall now be charged for grant of incentives under the Schemes of FTP.

Disposal of Manufacturing Wastes:

Disposal of manufacturing wastes / scrap will now be allowed after payment of
applicable excise duty also before fulfillment of export obligation under Advance Authorisation and EPCG Scheme. Earlier it was allowed after fulfillment of export obligation.

Announcements for Sports Weapon:

Licenses for the import of sports weapon will be issued now by Regional Authorities

provided a NOC (No Objection Certificate) is issued by Ministry of Sports & Youth
Affairs. (Earlier DGFT Headquarters had to be approached for this)

Announcements for Medical Devices

To solve the problem of medical device industry, the procedure for issue of Free Sale Certificate has been simplified and the validity of the Certificate has been increased from 1 year to 2 years.

Announcements for Automobile Industry

Those Automobile industries which have their R&D establishment will be allowed
free import of reference fuels (petrol and diesel), upto a maximum of 5 KL per annum, which are not manufactured in India. Simplification in EPCG for automobile industry.

Announcements for EDI Initiatives

1. Export Promotion Councils & Commodity Boards have been advised to issue RCMC

through a web based online system.

2. It is expected that issuance of RCMC would become EDI enabled before the end of 2009

Set up of Directorate of Trade Remedy Measures Announced

A Directorate of Trade Remedy Measures shall be set up, which will enable support to Indian industry and exporters, especially the Micro Small & medium Enterprises MSMEs in availing their rights through trade remedy instruments.

Duty Credit Scrips

Earlier the payment of customs duty for Export Obligation (EO) shortfall under
Advance Authorization , DFIA (Duty Free Import Authorization) or EPCG Authorization was allowed in cash only. Now this payment can be done in the way of debit of Duty Credit scrips.

Import of Restricted Items

Restricted Items can be imported now (as replenishment) against transferred DFIAs

(Duty Free Import Authorization) as the present DFRC (Duty Free Replenishment
Card) scheme.

Dollar Credits
There is a provision for state-run banks to provide dollar credits

Old Policy VS. New Policy

2009-14 2009-14 New emerging markets. Focus on Key objective: Arrest the declining exports and reverse the trend. Requirement of Handloom Mark for availing benefits under FPS has been A multipronged strategy was adopted to removed. provide stability of policy supporting Schemes: employment intensive sectors. Decided to continue with the DEPB Scheme up to December 2010 . Enhanced insurance coverage and exposure for exports through ECGC Schemes has been ensured till 31st March 2010 Diversification of products and markets through rationalization of incentive schemes Zero duty EPCG scheme and incentives for exports. 2004-09 Focus on 2004-09 Sectors with significant export prospects objective: to generation in Two fold for employmentdouble India's semi-urban share of areas. percentage and rural global merchandise trade by 2009. A new Handicraft Special Economic Zone shall The be established. key strategies were: (i)Unshackling of controls; Schemes: (ii) Creating an atmosphere of trust and A new scheme to accelerate growth of transparency; exports called procedures (iii) Simplifying 'Target Plus' &has been bringing introduced. down transaction costs Another scheme called Vishesh Krishi (iv) Adopting the fundamental principle Upaj duties and levies should not be that Yojana (Special Agricultural Produce Scheme) exported Served from India' nurturing endorse (v) Identifying and Scheme to different export special offocus areas to facilitate services was introduced. development of India as a global hub for manufacturing, trading and services.

Old Policy VS. New Policy

2009-14 2004-09 Gems & Jewellery Sector: Duty free Gems & Jewellery Sector: Duty Drawback import of consumables for metals other is allowed on Gold Jewellery exports than gold and platinum allowed up to 2% to neutralize duty incidence. of FOB value of exports. Time limit of 60 days for re-import of Duty free re-import entitlement for exported gems and jewellery items, rejected jewellery allowed up to 2% of for participation in exhibitions has FOB value of exports. been extended to 90 days in case of USA.