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Home > Interim Foreign Trade Policy (2009-10)
Interim Foreign Trade Policy (2009-10)
Interim Foreign Trade Policy (2009-10)
The interim foreign trade policy unveiled by the Government has offered incentives for the leather and textiles sector, eased trade restrictions on the gems & jewellery industry and relaxed export obligations.

The Government has scaled down the country's export target for the current fiscal year from $200 billion to $170-175 billion, in the backdrop of the global downturn, while $200 billion export target has been set for the fiscal 2009-10.

The sops announced by commerce and industry minister Kamal Nath include a special package of Rs 325 crore for the textiles and leather sectors and a proposal to lower the threshold limit for recognition as premier trading house from Rs 10,000 crore to Rs 7,500 crore. A 5% duty credit is now allowed for the export of handmade carpet under the Focus Product Scheme, against 3.5% given earlier.

The policy has also focussed on the gems & jewellery sector, one of the most affected by the global recession. It removed import restrictions on worked corals and has made more additions in the list of authorized agencies for the purpose of import of precious metals. Now the STCL Limited, Diamond India Limited, MSTC Limited, Gem & Jewellery Export Promotion Council and star trading houses have been added under the list of nominated agencies. Authorised person of Gem & Jewellery units in EOU shall be allowed personal carriage of gold up to 10 kg in a financial year.

While Srinagar will have a new office of the Directorate General of Foreign Trade (DGFT), Bhilwara in Rajasthan and Surat in Gujarat have been recognized as towns of Export Excellence for textiles and diamonds respectively.

Recognising the delay in payments from foreign buyers due to the financial crisis, the government has decided to issue duty credit scrips (authorization for duty free imports) under the duty entitlement pass book (DEPB) scheme - a popular import duty reimbursement scheme for exporters - without waiting for realization of export payments. This would help ease capital requirements of exporters. It also allowed the use of the duty credit scrips for import of restricted items.

Export obligations have been relaxed for exporters who imported machinery at concessional rates under the export promotion capital goods scheme. It has brought down the export obligation and allowed more time to meet these targets.

Export obligation period against advance authorisations have been extended up to 36 months from the present 24 months. The threshold limit for recognition as premier trading houses that get various concessions including self-certification of cargo has been reduced to Rs 7,500 crore from Rs 10,000 crore at present.

Now 100% Export Oriented Units (EOUs) will be reimbursed additional duty on excise on top of the excise duty they were already entitled to.

The government has also allowed export of blood samples without license after obtaining no objection certificate from the Director General of Health Services (DGHS).

Export obligation period against advance authorizations has been extended up to 36 months in view of the present global slowdown. Re-imbursement of additional duty of excise on fuel would also be admissible for EOUs. Customs duty under export promotion capital goods scheme cut to 3% from 5%.

It has also been clarified that architectural, general insurance, market research, storage and warehousing services and knowledge and technology based services used outside India are treated as export of services and any duty paid will be refunded.
 
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