Project Report

On

EXIM POLICY

Sumeet Singh
MBA (Gen)
Roll. No.= 89
Sec=B
 Contents

Sr.No. Subject Covered Page No.

1 Introduction 3

2 General Objectives of Exim Policy 4

3 Objectives Of EXIM policy (2008 –09) 5

4 Strategy 6-7

5 Main Annual Supplement Highlights 8

6 Some Other Highlights of The EXIM Policy 9-10

7 Implications of The Foreign Trade 11

8 Negative List of Exports 12-13

1. Introduction :

For India to become a major player in world trade, an all encompassing,

comprehensive view needs to be taken for the overall development of the country’s

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foreign trade. While increase in exports is of vital importance, we have also to

facilitate those imports which are required to stimulate our economy. Coherence and

consistency among trade and other economic policies is important for maximizing

the contribution of such policies to development. Thus, while incorporating the

existing practice of enunciating an annual Exim Policy, it is necessary to go much

beyond and take an integrated approach to the developmental requirements of

India’s Foreign trade.

The Government of India, Ministry of Commerce and Industry announces Export

Import Policy after every five years. EXIM policy, in general, aims at developing

export potential, improving export performance, encouraging foreign trade and

creating favorable balance of payments position. The current Exim Policy covers the

period 2004-2009. The Export Import Policy (EXIM Policy) is updated every year on

the 31st of March and the modifications, improvements and new schemes becomes

effective from 1st April of every year.

2. General Objectives of Exim Policy :

1. To establish the framework for globalization.

2. To promote the productivity competitiveness of Indian Industry.

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 3. To Encourage the attainment of high and internationally accepted standards

of quality.

4. To augment export by facilitating access to raw material,intermediate,

components, consumables and capital goods from the international market.

5. To promote internationally competitive import substitution and self-reliance..

3. Objectives Of EXIM policy ( 2008 – 2009) :

Trade is not an end in itself, but a means to economic growth and national
development. The primary purpose is not the mere earning of foreign exchange, but
the stimulation of greater economic activity.

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The Foreign Trade Policy is rooted in this belief and built around two major

objectives. These are:

1. To double our percentage share of global merchandise trade within the next
five years; and

2. To act as an effective instrument of economic growth by giving a thrust to

employment generation.

4. Strategy :

These objectives are proposed to be achieved by adopting, among others, the

following strategies:

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1. Unshackling of controls and creating an atmosphere of trust and

transparency to unleash the innate entrepreneurship of our businessmen,

industrialists and traders

2. Simplifying procedures and bringing down transaction costs.

3. Neutralizing incidence of all levies and duties on inputs used in export

products, based on the fundamental principle that duties and levies should
not be exported

4. Facilitating development of India as a global hub for manufacturing, trading

and services.

5. Identifying and nurturing special focus areas which would generate

additional employment opportunities, particularly in semi-urban and rural

areas, and developing a series of ‘Initiatives’ for each of these

6. Facilitating technological and infrastructural up gradation of all the sectors

of the Indian economy, especially through import of capital goods and

equipment, thereby increasing value addition and productivity, while
attaining internationally accepted standards of quality

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 7. Avoiding inverted duty structures and ensuring that our domestic sectors

are not disadvantaged in the Free Trade Agreements/Regional Trade

Agreements/Preferential Trade Agreements that we enter into in order to
enhance our exports

8. Upgrading our infrastructural network, both physical and virtual, related to

the entire Foreign Trade chain, to international standards.

9. Revitalizing the Board of Trade by redefining its role, giving it due

recognition and inducting experts on Trade Policy.

10. Activating our Embassies as key players in our export strategy and linking

our Commercial Wings abroad through an electronic platform for real time
trade intelligence and enquiry dissemination.

5. Main Annual Supplement Highlights (2008 – 09) :

1. DEPB scheme has been extended till May 2009.

2. Refund of service tax on almost all the services.

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 3. Income tax benefit to 100% EOUs has been extended by Government.

4. Coverage of FMS has been increased and additional 10 countries have been

included. These are Mongolia, Bosnia-Herzegovina, Albania, Macedonia,

Croatia, Honduras, Djibouti, Sudan, Ghana and Colombia.

5. Split-up facility under DFIA Scheme introduced.

6. Duty free import of samples has been increased from Rs.75, 000 to

Rs.1,00,000.

7. Value of jeweler parcels, through Foreign Post Office is raised to US$ 75,000.
Earlier it was from US$ 50,000.

8. EOUs shall be allowed to pay excise duty on monthly basis, instead of the

present system of paying duty on consignment basis.

9. Customs duty payable under EPCG Scheme has been reduced from 5% to 3%.

6. Some Other Highlights of The EXIM Policy :

1. Inter State Trade Council :

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 To engage the State Government inproviding an enabling environment for
boosting international trade, by setting up an Inter State Trade Council.

2. Removal of Export Cess :

Proposed to abolish cess on export of all agricultural and plantation

commodities levied under various commodity Board Acts.

3. Export Promotion Capital Goods Scheme (EPCG) :

This scheme is extended to Agricultural sector, SSI sector, Retail Sectors in

order to promote exports from them.

4. Service Export :

To upgrade infrastructure in the service related companies.

5. Agri Export :

Benefits under ‘Vishesh Krishi Upaj Yojana’ have been extended to exports of
poultry and dairy products in addition to export of flowers, fruits, vegetables and
their value added products.

6. Package for Marine Sector :

Duty free import of specified specialized chemicals and flavoring oils as per a
defined list shall be allowed to the extent of 1% of FOB value of preceding
financial years export.
7. Advance Licensing Scheme :

The Scope of Advance License for annual requirement has been extended to all
categories of exporters having past export performance.

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 8. Duty Free Replenishment Certificate :

Brass scrap, Additives, paper board, and dye stuff have been removed from the
list of items prescribed for import under DFRC.

9. Procedural Simplification :

Proposed to simplify procedures and reduce the documentation requirements

so as to reduce the transaction cost of the exporters and thereby increase their
competitiveness

10. EDI Initiatives :

DGFT shall introduce an automated electronic system for filing, retrieval and
authentication of documents based on agreed protocols and message exchange
with other authorities such including Customs and banks.

7. Implications of The Foreign Trade (2004-09):

1. Implications on Indian Economy:

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 This policy propose to simplify procedures and develop technology and
infrastructure.

2. Implications on Agriculture:
– Special Agricultural Produce Scheme has been introduced for promoting the
export of fruits, vegetables, flowers, and their value added products.
–
3. Implications on Handlooms and Handicraft:
– Establishment of Handicraft SEZ and Handicraft Export Promotion
Council would promote development of Handloom and Handicraft Industry
–
4. Implications on Gem and Jewellery Sector :
– This is special thrust area in this policy. Duty free imports of other inputs
would give a further boostto this sector
–
5. Implications on Leather and Footwear Industry :
– Duty free import as a specified percentage of exports. Exemption on
customs duty on equipment for effluent treatment plants would help
promoting export form this sector.
–
6. Implications on Service Industry :
An exclusive service promotion council has been set up in order to map the
opportunities for key services in key market.
8. Negative List of Exports :

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The negative list consists of goods, the import or export of which is ether prohibited,
restricted through licensing or otherwise to be canalized through a designate
government agency
.
The negative list of exports, as per the EXIM Policy

1. Prohibited Items : Which items completely banned from the exports.

 All forms of wild animals including their parts and products.

 Special Chemicals as notified by the DGFT.
 Exotic birds as notified by the DGFT.
 Beef.
 Sea Shells, as specified
 Human Skeleton.
 Peacock Tail
 Red sanders wood in any form.

2. Restricted Items :which items allowed for exports under special license issued

by the DGFT.

 Dress materials, ready-made garments, fabrics or textile items with

imprints of excerpts or verses of the Holy Quran.

 Horses – Kathiawadi, Marwari, and Manipuri breeds.
 Fresh and frozen silver prom frets of weight less than 300gm.
 Paddy (Rice in husk).

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 Seaweeds of all types.
 Chemical Fertilizer all types

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