India’s Foreign Trade Policy (FTP) of 2023 was unveiled amidst the country’s highest export figures yet, with merchandise and services reaching a staggering $760 billion. The policy aims to keep this momentum in the face of global challenges like supply chain disruptions and international conflicts.
From Past Incentives to Future Readiness
Previously, India offered incentives like the Merchandise Exports from India Scheme (MEIS) and the Services Exports from India Scheme (SEIS), but they were phased out for being non-compliant with World Trade Organization (WTO) rules. Now, India has shifted focus towards production-linked incentives (PLI), which are expected to boost domestic production and, subsequently, exports.
Evolving Trade Policy for Dynamic Times
FTP 2023 has no expiration date, breaking from the past practice of setting a fixed duration for trade policies. This reflects a move towards a dynamic, responsive policy that adapts to the changing global and domestic economic landscapes.
Digitalization and Efficiency at the Forefront
The new FTP brings a strong focus on digital governance and trade facilitation. With plans to develop an e-commerce export portal, India aims to simplify and streamline customs and logistics, making it easier for businesses, especially micro, small, and medium enterprises (MSMEs), to participate in global trade.
Enhanced e-Governance Measures
The policy includes the digitization of Export Obligation Discharge Certificates and the integration of various digital tools to expedite trade processes. The Directorate General of Foreign Trade (DGFT) is set to automate permissions and approvals, cutting down processing times significantly.
Boosting E-Commerce Export Potential
The FTP 2023 raises the limit for e-commerce exports to Rs.10 lakh, offering a vast opportunity for small businesses and artisans to reach international markets. The policy aims to make India a significant player in the global e-commerce landscape.
Democratizing Export Opportunities
Initiatives like the Districts as Export Hubs scheme aim to harness local talent, empowering artisans and small businesses to explore international markets. This grassroots approach is designed to build a robust export ecosystem accessible to all levels of the socio-economic ladder.
SCOMET Policy Overhaul
Considering the growing defence exports, the FTP 2023 streamlines the Special Chemicals, Organisms, Materials, Equipment, and Technologies (SCOMET) policy. It simplifies the licensing process for dual-use items, aligning India’s trade practices with its commitments to various international export control regimes.
In essence, FTP 2023 sets a path for India’s trade to be more adaptive, inclusive, and technologically advanced, aiming to sustain growth in a rapidly changing global economic environment.
