Foreign Trade Policy (FTP) for 2015-2020


April 2015                                                                                   Ajit Kumar (Wisdom IAS, New Delhi)
The government of India,Department of Commerce Ministry of Commerce and Industry  on April1, 2015 unveiled a forward-looking and contemporary Foreign Trade Policy (FTP) for 2015-2020, seeking to strengthen merchandise and services exports with a targeted value of $900 billion by 2020. The focus of the new policy is to support both the manufacturing and services sectors, with a special emphasis on improving the ‘ease of doing business’.
FTP2015-20 introduces two new schemes, namely “Merchandise Exports from India Scheme (MEIS)” for export of specified goods to specified markets and “Services Exports from India Scheme (SEIS)” for increasing exports of notified services, in place of a plethora of schemes earlier, with different conditions for eligibility and usage.  There would be no conditionality attached to any scrips issued under these schemes.  Duty credit scrips issued under MEIS and SEIS and the goods imported against these scrips are fully transferable. For grant of rewards under MEIS, the countries have been categorized into 3 Groups, whereas the rates of rewards under MEIS range from 2% to 5%. Under SEIS the selected Services would be rewarded at the rates of 3% and 5%.
Measures have been adopted to nudge procurement of capital goods from indigenous manufacturers under the EPCG scheme by reducing specific export obligation to 75% of the normal export obligation. This will promote the domestic capital goods manufacturing industry.  Such flexibilities will help exporters to develop their productive capacities for both local and global consumption.  Measures have been taken to give a boost to exports of defense and hi-tech items.  At the same time e-Commerce exports of handloom products, books/periodicals, leather footwear, toys and customized fashion garments through courier or foreign post office would also be able to get benefit of MEIS (for values upto 25,000 INR).  These measures would not only capitalize on India's strength in these areas and increase exports but also provide employment.
Goals and Objectives
A vision is best achieved through measurable targets. Government aims to increase India‟s exports of merchandise and services from USD 465.9 billion in 2013-14 to approximately USD 900 billion by 2019-20 and to raise India‟s share in world exports from 2 percent to 3.5 percent.
The FTP for 2015-2020 seeks to achieve the following objectives:
(i) To provide a stable and sustainable policy environment for foreign trade in merchandise and services;
(ii) To link rules, procedures and incentives for exports and imports with other initiatives such as „Make in India‟, „Digital India‟ and „Skills India‟ to create an „Export Promotion Mission‟ for India;
(iii) To promote the diversification of India‟s export basket by helping various sectors of the Indian economy to gain global competitiveness with a view to promoting exports;
(iv) To create an architecture for India‟s global trade engagement with a view to expanding its markets and better integrating with major regions, thereby increasing the demand for India‟s products and contributing to the government‟s flagship „Make in India‟ initiative; (v) To provide a mechanism for regular appraisal in order to rationalise imports and reduce the trade imbalance.

Highlights of the policy are given below.

 Export from India Schemes:
 1. Merchandise Exports from India Scheme (MEIS)
 (a) Earlier there were 5 different schemes (Focus Product Scheme, Market Linked Focus Product Scheme, Focus Market Scheme, Agri. Infrastructure Incentive Scrip, VKGUY) for rewarding merchandise exports with different kinds of duty scrips with varying conditions (sector specific or actual user only) attached to their use. Now all these schemes have been merged into a single scheme, namely Merchandise Export from India Scheme (MEIS) and there would be no conditionality attached to the scrips issued under the scheme.
(b) Rewards for export of notified goods to notified markets under ‘Merchandise Exports 2 from India Scheme (MEIS) shall be payable as percentage of realized FOB value (in free foreign exchange). The debits towards basic customs duty in the transferable reward duty credit scrips would also be allowed adjustment as duty drawback. At present, only the additional duty of customs / excise duty / service tax is allowed adjustment as CENVAT credit or drawback, as per Department of Revenue rules.
 2. Service Exports from India Scheme (SEIS)
(a) Served From India Scheme (SFIS) has been replaced with Service Exports from India Scheme (SEIS). SEIS shall apply to ‘Service Providers located in India’ instead of ‘Indian Service Providers’. Thus SEIS provides for rewards to all Service providers of notified services, who are providing services from India, regardless of the constitution or profile of the service provider.
(b) The rate of reward under SEIS would be based on net foreign exchange earned. The reward issued as duty credit scrip, would no longer be with actual user condition and will no longer be restricted to usage for specified types of goods but be freely transferable and usable for all types of goods and service tax 3 debits on procurement of services / goods. Debits would be eligible for CENVAT credit or drawback.
3.Incentives (MEIS & SEIS) to be available for SEZs
 It is now proposed to extend incentives (MEIS & SEIS) to units located in SEZs also.
 4. Duty credit scrips to be freely transferable and usable for payment of custom duty, excise duty and service tax.
 (a) All scrips issued under MEIS and SEIS and the goods imported against these scrips would be fully transferable.
(b) Scrips issued under Exports from India Schemes can be used for the following:-
(i) Payment of customs duty for import of inputs / goods including capital goods, except items listed in Appendix 3A.
 (ii) Payment of excise duty on domestic procurement of inputs or goods, including capital goods as per DoR notification.
(iii) Payment of service tax on procurement of services as per DoR notification.
(c) Basic Customs Duty paid in cash or through debit under Duty Credit Scrip can be taken back as Duty Drawback as per DoR Rules, if inputs so imported are used for exports.
 5. Status Holders
 (a) Business leaders who have excelled in international trade and have successfully contributed to country’s foreign trade are proposed to be recognized as Status Holders and given special treatment and privileges to facilitate their trade transactions, in order to reduce their transaction costs and time.
 (b) The nomenclature of Export House, Star Export House, Trading House, Star Trading House, Premier Trading House certificate has been changed to One, Two, Three, Four, Five Star Export House.
 (c) The criteria for export performance for recognition of status holder have been changed from Rupees to US dollar earnings.
 The new criteria is as under:-
Status category                                                                          Export Performance
                                                                                              FOB / FOR (as converted)
                                                        Value (in US $ million) during current and previous two years
One Star Export House                                                           3
Two Star Export House                                                          25
Three Star Export House                                                       100
Four Star Export House                                                       500
Five Star Export House                                                        2000
(d) Approved Exporter Scheme - Self certification by Status Holders Manufacturers who are also Status Holders will be enabled to self-certify their manufactured goods as originating from India with a view to qualify for preferential treatment under different Preferential Trading Agreements [PTAs], Free Trade Agreements [FTAs], Comprehensive Economic Cooperation Agreements [CECAs] and Comprehensive Economic Partnerships Agreements [CEPAs] which are in operation. They shall be permitted to self-certify the goods as manufactured as per 6 their Industrial Entrepreneur Memorandum (IEM) / Industrial Licence (IL)/ Letter of Intent (LOI).
6. Reduced Export Obligation (EO) for domestic procurement under EPCG scheme: Specific Export Obligation under EPCG scheme, in case capital goods are procured from indigenous manufacturers, which is currently 90% of the normal export obligation (6 times at the duty saved amount) has been reduced to 75%, in order to promote domestic capital goods manufacturing industry.
7. Higher level of rewards under MEIS for export items with high domestic content and value addition.
 It is proposed to give higher level of rewards to products with high domestic content and value addition, as compared to products with high import content and less value addition.
 8. Online filing of documents/ applications and Paperless trade in 24x7 environment:
(a) DGFT already provides facility of Online filing of various applications under FTP by the exporters/importers. However, certain documents like Certificates issued by Chartered Accountants/ Company Secretary / Cost Accountant etc. have to be filed in physical forms only. In order to move further towards paperless processing of reward schemes, it has been decided to develop an online procedure to upload digitally signed documents by Chartered Accountant / Company Secretary / Cost Accountant. In the new system, it will be possible to upload online documents like annexure attached to ANF 3B, ANF 3C and ANF 3D, which are at present signed by these signatories and submitted physically.
(b) Henceforth, hardcopies of applications and specified documents would not be required to be submitted to RA, saving paper as well as cost and time for the exporters. To start with, applications under Chapter 3 & 4 of FTP are being covered (which account for nearly 70% of total applications in DGFT). Applications 8 under Chapter-5 would be taken up in the next phase.
(c) As a measure of ease of doing business, landing documents of export consignment as proofs for notified market can be digitally uploaded in the following manner:-
(i) Any exporter may upload the scanned copy of Bill of Entry under his digital signature.
(ii) Status holders falling in the category of Three Star, Four Star or Five Star Export House may upload scanned copies of documents.
 9. Online inter-ministerial consultations:
It is proposed to have Online inter-ministerial consultations for approval of export of SCOMET items, Norms fixation, Import Authorisations, Export Authorisation, in a phased manner, with the objective to reduce time for approval. As a result, there would not be any need to submit hard copies of documents for these purposes by the exporters. 9
10. Simplification of procedures/processes, digitisation and e-governance
(a) Under EPCG scheme, obtaining and submitting a certificate from an independent Chartered Engineer, confirming the use of spares, tools, refractory and catalysts imported for final redemption of EPCG authorizations has been dispensed with.
(b) At present, the EPCG Authorisation holders are required to maintain records for 3 years after redemption of Authorisations. Now the EPCG Authorization Holders shall be required to maintain records for a period of two years only. Government’s endeavour is to gradually phase out this requirement as the relevant records such as Shipping Bills, e-BRC are likely to be available in electronic mode which can be archived and retrieved whenever required.
 (c) Exporter Importer Profile: Facility has been created to upload documents in Exporter/Importer Profile. There will be no need to submit copies of permanent records/ documents (e.g. IEC, Manufacturing licence, RCMC, PAN etc.) repeatedly with each application, once uploaded.
(d) Communication with Exporters/Importers: Certain information, like mobile number, e-mail address etc. has been added as mandatory fields, in IEC data base. This information once provided by exporters, would help in better communication with exporters. SMS/ email would be sent to exporters to inform them about issuance of authorisations or status of their applications.
(e) Online message exchange with CBDT and MCA: It has been decided to have on line message exchange with CBDT for PAN data and with Ministry of Corporate Affairs for CIN and DIN data. This integration would obviate the need for seeking information from IEC holders for subsequent amendments/ updation of data in IEC data base. (e) Communication with Committees of DGFT: For faster and paperless communication with various committees of DGFT, dedicated email addresses have been provided to each Norms Committee, Import Committee and Pre-Shipment Inspection Agency for faster communication.
 (f) Online applications for refunds: Online filing of application for refund of TED is being 11 introduced for which a new ANF has been created.
 11. Forthcoming e-Governance Initiatives
 (a) DGFT is currently working on the following EDI initiatives:
(i) Message exchange for transmission of export reward scrips from DGFT to Customs.
 (ii) Message exchange for transmission of Bills of Entry (import details) from Customs to DGFT.
 (iii) Online issuance of Export Obligation Discharge Certificate (EODC).
 (iv) Message exchange with Ministry of Corporate Affairs for CIN & DIN.
 (v) Message exchange with CBDT for PAN.
(vi) Facility to pay application fee using debit card / credit card.
 (vii) Open API for submission of IEC application. (viii) Mobile applications for FTP 12
 D. Other new Initiatives
 12. New initiatives for EOUs, EHTPs and STPs
 (a) EOUs, EHTPs, STPs have been allowed to share infrastructural facilities among themselves. This will enable units to utilize their infrastructural facilities in an optimum way and avoid duplication of efforts and cost to create separate infrastructural facilities in different units.
 (b) Inter unit transfer of goods and services have been allowed among EOUs, EHTPs, STPs, and BTPs. This will facilitate group of those units which source inputs centrally in order to obtain bulk discount. This will reduce cost of transportation, other logistic costs and result in maintaining effective supply chain.
(c) EOUs have been allowed facility to set up Warehouses near the port of export. This will help in reducing lead time for delivery of goods and will also address the issue of unpredictability of supply orders.
(d) STP units, EHTP units, software EOUs have been allowed the facility to use all duty free equipment/goods for training purposes. This will help these units in developing skills of their employees.
 (e) 100% EOU units have been allowed facility of supply of spares/ components up to 2% of the value of the manufactured articles to a buyer in domestic market for the purpose of after sale services.
 (f) At present, in a period of 5 years EOU units have to achieve Positive Net Foreign Exchange Earning (NEE) cumulatively. Because of adverse market condition or any ground of genuine hardship, then such period of 5 years for NFE completion can be extended by one year.
 (g) Time period for validity of Letter of Permission (LOP) for EOUs/EHTP/ STPI/BTP Units has been revised for faster implementation and monitoring of projects. Now, LOP will have an initial validity of 2 years to enable the unit to construct the plant and install the machinery. Further extension can be granted by the Development Commissioner up to one year. Extension beyond 3 years of the validity of LOP, can be granted, in case unit has completed 2/3rd of activities, including the construction activities. (h) At present, EOUs/EHTP/STPI units are permitted to transfer capital goods to other EOUs, EHTPs, STPs, SEZ units. Now a facility has been provided that if such 14 transferred capital goods are rejected by the recipient, then the same can be returned to the supplying unit, without payment of duty.
 (i) A simplified procedure will be provided to fast track the de-bonding / exit of the STP/ EHTP units. This will save time for these units and help in reduction of transaction cost.
 (j) EOUs having physical export turnover of Rs.10 crore and above, have been allowed the facility of fast track clearances of import and domestic procurement. They will be allowed fast tract clearances of goods, for export production, on the basis of preauthenticated procurement certificate, issued by customs / central excise authorities. They will not have to seek procurement permission for every import consignment.
 13. Facilitating & Encouraging Export of dual use items (SCOMET).
(a) Validity of SCOMET export authorisation has been extended from the present 12 months to 24 months. It will help industry to plan their activity in an orderly manner and obviate the need to seek revalidation or relaxation from DGFT.
(b) Authorisation for repeat orders will be considered on automatic basis subject to certain conditions.
(c) Verification of End User Certificate (EUC) is being simplified if SCOMET item is being exported under Defence Export Offset Policy.
(d) Outreach programmes will be conducted at different locations to raise awareness among various stakeholders.
14 Facilitating & Encouraging Export of Defence Exports
 (a) Normal export obligation period under advance authorization is 18 months. Export obligation period for export items falling in the category of defence, military store, aerospace and nuclear energy shall be 24 months from the date of issue of authorization or co-terminus with contracted duration of the export order, whichever is later. This provision will help export of defence items and other high technology items.
 (b) A list of military stores requiring NOC of Department of Defence Production has been notified by DGFT recently. A committee has been formed to create ITC (HS) codes 16 for defence and security items for which industrial licenses are issued by DIPP.
 15. e-Commerce Exports
(a) Goods falling in the category of handloom products, books / periodicals, leather footwear, toys and customized fashion garments, having FOB value up to Rs.25000 per consignment (finalized using eCommerce platform) shall be eligible for benefits under FTP. Such goods can be exported in manual mode through Foreign Post Offices at New Delhi, Mumbai and Chennai.
(b) Export of such goods under Courier Regulations shall be allowed manually on pilot basis through Airports at Delhi, Mumbai and Chennai as per appropriate amendments in regulations to be made by Department of Revenue. Department of Revenue shall fast track the implementation of EDI mode at courier terminals.
 16. Duty Exemption
(a) Imports against Advance Authorization shall also be eligible for exemption from Transitional Product Specific Safeguard Duty.
(b) In order to encourage manufacturing of capital goods in India, import under EPCG Authorisation Scheme shall not be eligible for exemption from payment of anti-dumping duty, safeguard duty and transitional product specific safeguard duty.
 17. Additional Ports allowed for Export and import
Calicut Airport, Kerala and Arakonam ICD, Tamil Nadu have been notified as registered ports for import and export.
18. Duty Free Tariff Preference (DFTP) Scheme
 India has already extended duty free tariff preference to 33 Least Developed Countries (LDCs) across the globe. This is being notified under FTP.
 19. Quality complaints and Trade Disputes
 (a) In an endeavour to resolve quality complaints and trade disputes, between exporters and importers, a new chapter, namely, Chapter on Quality Complaints and Trade Disputes has been incorporated in the Foreign Trade Policy.
 (b) For resolving such disputes at a faster pace, a Committee on Quality Complaints and Trade Disputes (CQCTD) is being constituted in 22 offices and would have members from EPCs/FIEOs/APEDA/EICs.
20. Vishakhapatnam and Bhimavaram added as Towns of Export Excellence
 Government has already recognized 33 towns as export excellence towns. It has been decided to add Vishakhapatnam and Bhimavaram in Andhra Pradesh as towns of export excellence (Product Category– Seafood)
I. Merchandise Exports from India Scheme
 (i) Merchandise Exports from India Scheme has replaced 5 different schemes of earlier FTP (Focus Product Scheme, Market Linked Focus Product Scheme, Focus Market Scheme, Agri. Infrastructure Incentive Scrip, VKGUY) for rewarding merchandise exports which had varying conditions (sector specific or actual user only) attached to their use.
 (ii) Now all these schemes have been merged into a single scheme, namely Merchandise Export from India Scheme (MEIS) and there would be no conditionality attached to the scrips issued under the scheme. Notified goods exported to notified markets would be rewarded on realised FOB value of exports
II. Services Exports from India Scheme
(i) Served from India Scheme (SFIS) has been replaced with Service Exports from India Scheme (SEIS). SEIS shall apply to `Service Providers’ located in India’ instead of `Indian Service Providers’. Thus SEIS provides for rewards to all Service providers of notified services, who are providing services from India, regardless of the constitution or profile of the service provider.
(ii) The rate of reward under SEIS would be based on net foreign exchange earned. The reward issued as duty credit scrip, would no longer be with actual user condition and will no longer be restricted to usage for specified types of goods but be freely transferable and usable for all types of goods and service tax debits on procurement of services/goods. Debits would be eligible for CENVAT credit or drawback.
(iii) The present rates of reward are 3% and 5%. The list of services and the rates of rewards would be reviewed after 30.9.2015.

Analysis of the Policy

Advantages and Limitations
The Business Line analyses that the exports from SEZs suffering from high MAT would now be eligible for incentives. Another notable positive is the introduction of transferability of duty free scrips and allowing them for payment of customs, excise duties and service tax without any conditionality. However, it would be worth examining how effective the new FTP would be in pushing India’s merchandise exports.
It is very difficult to decode what forms the basis of categorising India’s export destinations into three groupings as well as allocation of MEIS rates for different commodities. What could explain the exclusion of countries such as Brazil, Bangladesh and China for export promotion with respect to top textile products?
Again, increasing exports to China should have been top priority, but there is no real incentive for China in the new FTP even though it is a top export destination for cotton fibre and yarn.
From a strict reading of the FTP, only direct export to Japan and the US should be eligible for MEIS. The problem is India mostly exports fabrics to Bangladesh, Indonesia, Myanmar and Vietnam for conversion into garments that are ultimately shipped to Japan and the US.
It is worth mentioning that some of India’s well intentioned trade policy actions (to help LDCs like Bangladesh), though outside the purview of the FTP, are hurting indigenous manufacturing.
For instance, allowing duty free, quota free import of garments from Bangladesh (or Myanmar) without imposing sourcing obligations promotes the backdoor entry of Chinese textile material into India, and hurts the whole textile value chain in the country from fibre to yarn, fabrics and apparel.
Sourcing Blues
The FTP needs to follow up with other actions like making the use of fibres, yarns and fabrics of Indian origin mandatory for allowing duty free imports of apparel from Bangladesh and other LDCs seeking preferential market access on non-reciprocal basis.
It’s not that India would be the first country to impose sourcing restrictions for allowing duty free imports of apparels. The US imposes sourcing restrictions in all its existing and proposed trade pacts. Why can’t India?
Because of India’s FTAs and other trade deals such as Information Technology Agreement (ITA), India’s manufacturing sector has to suffer what is called inverted duty structure, that is, high import duties on inputs/ raw materials and lower duties on finished goods. Thus, one can import an apparel item duty free in India but its basic raw materials are subject to 5 to 10 per cent import duties. The Union Budget 2015-16  did attempt to address some of the cases of inverted duties, but only partially.
Again, increasing the use of FTAs would require addressing non-tariff barriers in partner countries. For instance, Japan, as per the terms of the India-Japan CEPA, allows duty free import of apparels from India only if all the material used for the manufacture of apparels are either of Indian or Japanese origin.
Indian businesses should realise that the days of export subsidies are numbered because of WTO obligations. To deal with slowing demand and rising cost on a long-term basis, businesses must develop suitable global strategies for sourcing, production and trade.

Related Terms

Foreign Trade Policy (FTP)
India‟s Foreign Trade Policy (FTP) has, conventionally, been formulated for five years at a time and reviewed annually. The focus of the FTP has been to provide a framework of rules and procedures for exports and imports and a set of incentives for promoting exports.
The Foreign Trade Policy is notified by Central Government, in exercise of powers conferred under the Foreign Trade (Development & Regulation) Act, 1992.
     The Foreign Trade Policy is primarily focused on accelerating exports. This is sought to be implemented through various schemes intended to exempt and remit indirect taxes on inputs physically incorporated in the export product, import capital goods at concessional duty, stimulate services exports and focus on specific markets and products. The Policy attempts to dovetail these schemes with the specific market access openings that India has achieved through negotiations with its trading partners for various bilateral and regional trading arrangements.
Foreign trade today plays a significant part in India‟s economy, so much so that foreign trade policy deserves a special focus and dedicated attention as a key constituent of India‟s economic policies. Foreign trade policy can neither be formulated nor implemented by any one department in isolation. Going forward, a „whole-of-government‟ approach will be required.
 A major path breaking initiative taken by the Department of Commerce, which can have far reaching benefits if properly executed, is to mainstream State and Union Territory (UT) Governments and various Departments and Ministries of the Government of India in the process of international trade.
 Export Oriented Unit (EOU)
The Export Oriented Unit (EOU) scheme was introduced in the year 1980 vide Ministry of Commerce resolution dated 31st December 1980 . The purpose of the scheme was basically to boost exports by creating additional production capacity. The EOU scheme is complementary to the EPZ scheme, except that it is widely dispersed in location, unlike EPZs, which are set up at specific locations. The Scheme remains in the forefront of country’s export production schemes. 
STP Scheme
The Software Technology Park [STP] scheme is a 100 percent export oriented scheme for the development and export of computer software, including export of professional services using communication links or physical media. 
This scheme is unique in its nature as it focuses on one product/sector, i.e. computer software. The scheme integrates the government concept of 100 percent Export Oriented Units (EOUs) and Export Processing Zones (EPZs) and the concept of Science Parks/Technology Parks, as operating elsewhere in the world. A unique feature of the STP scheme is the provisioning of single-point contact services for member units, enabling them to conduct exports operations at a pace commensurate with international practices.
Highlights of the Scheme
(i) Approvals are given under single window clearance scheme.
(ii) A company can set up STP unit anywhere in India.
(iii) Jurisdictional STPI authorities clear projects costing less than Rs.100 million with Indian Investment.
(iv) 100% Foreign Equity is permitted.
(v) All the imports of Hardware & Software in the STP units are completely duty free, import of second hand capital goods also permitted.
(vi) Re-Export of capital goods is also permitted.
(vii) Simplified Minimum Export Performance norms i.e., "Positive Net Foreign Exchange Earnings"
(viii) Use of computer system for commercial training purposes is permissible subject to the condition that no computer terminals are installed outside the STP premises.
(ix) The sales in the Domestic Tariff Area (DTA) shall be permissible up to 50% of the export in value terms.
(x) STP units are exempted from payment of corporate income tax up to 2011.
(x) The capital goods purchased from the Domestic Tariff Area (DTA) are entitled forbenefits like exemption of excise Duty & reimbursement of Central Sales Tax (CST).
(xi) Capital invested by Foreign Entrepreneurs, Know-How Fees, Royalty, Dividend etc., can be freely repatriated after payment of Income Taxes due on them, if any.
(xii) The items like computers and computers peripherals can be donated to recognized non-commercial educational institutions, registered charitable hospitals, public libraries, public funded research and development establishments, organizations of Govt. of India, or Govt of a State or Union Territory without payment of any duties after two years of their import.
(xiii) 100% Depreciation on Capital Goods over a period of five years.
 EHTP Scheme
Units undertaking to export their entire production of goods and services may be set up under the Electronic Hardware Technology Park (EHTP) Scheme. Such units may be engaged in manufacture and services.
Commensurate with the policy to give a special thrust to export of electronic hardware, such units would be encouraged to be set up under the aforementioned export oriented scheme.
Highlights of the Scheme
(i) EHTP unit may import free of duty all types of goods, including capital goods as defined in the EXIM Policy, required by it for manufacture, services, production and processing or in connection therewith.
(ii) The units shall also be permitted to import goods, including capital goods, free of cost or on loan from clients required for the approved activity.
(iii) EHTP units may procure goods required by them for manufacture, services, production and processing or in connection therewith, duty free, from bonded warehouses in the DTA set up under the Exim Policy.
(iv) Positive Net Foreign Exchange Earnings against Export Earnings to be achieved over a period of five years.
Export promotion capital goods (EPCG) scheme
 The scheme allows import of capital goods under exemption from basic and additional duties of customs, as well as domestic sourcing of capital goods by an exporter, with corresponding export obligation. The old scheme is continued in the new Policy, with some variations.
 - The export obligation for domestic sourcing will be 25% less than in the case of imports of capital goods.
- Clubbing of EPCG authorisations will be allowed only if the export product endorsed thereon is same or similar and the authorisations are issued by the same Regional Authority of the DGFT .
 - The period of maintenance of records is reduced from three years to two years .

Monday, 20th Apr 2015, 09:17:38 AM

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