FOREIGN TRADE POLICY SINCE INDEPENDENCE, Features of FTP 2023

FOREIGN TRADE POLICY SINCE INDEPENDENCE:

1969 -1984:

1st Foreign Trade Policy (FTP) came in 1969 in the form of Export-Import policy and it was revised after every one year which continued till 1984.

1985 to 1991:

During this period, Foreign Trade Policy (FTP) was revised after every 3 years.

1992 to 2004:

Foreign Trade Policy (FTP) during this period was revised after every 5 years but with sunset clause.

2004-23: Foreign Trade Policy (FTP) during this period was revised after every 5 years. FTP of 2023 was unique in the sense that it doesnot have any sunset clause .

Features of FTP 2023:

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.

• The policy targets exports of $ 2 trillion by 2030.
• Greater faith is being reposed on exporters through automated IT systems with risk management .
• The policy emphasizes upon moving away from an incentive regime to a facilitating regime .
• Merchandise Exports from India Scheme (MEIS) and Service Exports from India Scheme (SEIS) have  been phased out in 2021 in the wake of the reservation of USA at WTO.
• MEIS has been replaced by Remission of Duties and Taxes on Exported Products (RODTEP).
• The FTP 2023 encourages recognition of new towns through “Towns of Export Excellence Scheme” and exporters through “Status Holder Scheme”.
• The FTP aims at building partnerships with State governments and taking forward the Districts as Export Hubs (DEH) initiative to promote exports at the district level and accelerate the development of grassroots trade ecosystem.

E-commerce in new FTP 2023:

• E-Commerce exports are a promising category that requires distinct policy interventions from traditional offline trade. 
• Various estimates suggest E-Commerce export potential in the range of $200 to $300 billion by 2030. 
• FTP 2023 outlines the intent and roadmap for establishing e-commerce hubs and related elements such as payment reconciliation, book-keeping, returns policy, and export entitlements. 

ANALYSIS of FTP 2023:

• There is need for a robust market information and intelligence system for export expansion and diversification.
• There is need of an interactive market information and intelligence system backed up with the required policy support such as incentives, tax exemptions, export assistance, and facilitation is the crux of the export promotion efforts of a country.
• World trade is a demand function, so correspondingly, the supply-side capabilities have to be created or achieved.