EXIM POLICY & CAPITAL ACCOUNT CONVERTIBILITY (2009-2014)GROUP 4Pallavi Luthra-152Saumya Verma-138Nikhil Sharma-154TonmoyeeGoswami- 40Utsav Gupta- 82DeepikaTyagi- 08Hitesh Mahansaria- 24
FLOW OF PRESENTATION
Export – Import Policy of India ((2009-2014) - With Supplement for Fiscal Year (2010-2011):
To provide additional support , especially to employee intensive sectors
To simplify procedures of Export and Import
GENERAL PROVISIONS REGARDING EXPORTS AND IMPORTS
Compliance with the provisions, the Rules and the Orders made there, under FTP
IEC No: Mandatory unless specifically exempted.
Transit of Goods: Through India from / or to countries adjacent to India shall be regulated in accordance with bilateral treaties between India and those countries and will be subject to restrictions.
Import of Second Hand Goods :
All second hand goods, except second hand capital goods, shall be restricted for imports.
Second hand personal computers / laptops, photocopier , air conditioners, etc will only be allowed against a license.
Free Exports :
All goods may be exported without any restriction except to the extent that such exports are regulated by ITC (HS) or any other provision of FTP or any other law for the time being in force.
Import of Gifts:
This shall be permitted where such goods are
otherwise freely importable under FTP.
In other cases, a Customs Clearance Permit (CCP)
shall be required from DGFT.
Export of Gifts:
Goods, of value not exceeding Rs.5,00,000 / may be exported as a gift.
However, items mentioned as restricted for exports in ITC (HS) shall
not be exported as a gift, without any authorization.
Bonafide household goods and personal effects may be imported as
part of passenger baggage as per limits, terms and conditions
thereof in Baggage Rules notified.
Denomination of Contracts:
All export contracts and invoices shall be denominated either in
freely convertible currency or Indian rupees but export proceeds shall
be realised in freely convertible currency.
Single Window System:
To reduce transaction and handling costs,
and to facilitate export of perishable agricultural
DGFT shall move towards an automated environment for electronic filing, retrieval and authentication of documents.
With a view to promote use of Information Technology, DGFT will provide fiscal incentives.
Free movement of Goods:
Consignments of items meant for exports shall not be withheld/ delayed for any reason by any agency of Central /State Government. In case of any doubt, authorities concerned may ask for an undertaking from exporter.
Promotional Measures in Department of Commerce
Formulated to provide the state governments for creating infrastructure for the development and growth of Exports. The specific purposes for which funds are allocated are as follows:
1) Creation of SEZs/Agribusiness units/EPZs
2) Development of complementary infrastructure such as roads connecting the production centres with the ports, setting up of inland container depots.
MAI: Financial assistance is available for export promotion. Activities funded under this can be from 25% to 100%
i) Market surveys ,setting up of show rooms
ii) Brand promotions ,participation in international trade
iii) Publicity campaigns etc
Brand Promotion and Quality- Its objective is to create international awareness of “Made in India” labels in the market overseas. This aims in effectively presenting India’s business perspective and leveraging business partnership in globalised market place.
Towns of Export Excellence- Necessary to grant recognition to industrial clusters which contributes to India’s exports to maximise their potential and enabling them to tap new markets. Towns producing goods of Rs. 750 croreswill be notified as TEE .
SERVED FROM INDIA SCHEME (SFIS)
This is to accelerate growth in export of services so as to create a powerful and unique ‘Served From India’ brand, instantly recognized and respected world over
More than 100 services like Professional Services, Computer Related services, Hotels, Restaurants, Educational Services, Research and Development, Tourism etc. are included
All Service Providers shall be entitled to Duty Credit Scrip equivalent to 10% of free foreign exchange earned during current financial year.
Export and Trading Houses
Merchant as well as Manufacturer Exporters, ServiceProviders, Export Oriented Units (EOUs) and Units located in Special Economic Zones (SEZs), Agri Export Zones (AEZs), Electronic Hardware Technology Parks (EHTPs), Software Technology Parks (STPs) and Bio-Technology Parks (BTPs) shall be eligible for status and avail various privileges.
SPECIAL ECONOMIC ZONES
Developed to enhance foreign investments and promote exports from the country.
Geographic regions where economic laws related to export and import are more liberal as compared to rest parts of the country.
No license required for import made in SEZ units.
Exemption from central sales tax on the sale or purchase of goods and exemption from payment of service tax.
Kandla, Gujarat Multi product Mumbai, Maharashtra Electronics and Gems and Jewellery,Noida ,Cochin Special Economic Zone Cochin, Falta Special Economic Zone ,Visakhapatnam SEZ.
There are 114 SEZs in India.
Growth of 121.4% is achieved in 2009-10
FOCUS MARKET SCHEME
To offset high freight cost and other externalities to enhance India’s export competitiveness in these countries.
Entitled for Duty Credit Script equivalent to 3% of FOB value of exports
FOCUS PRODUCT SCHEME
To incentivise export of products having high export intensity/employment potential.
Entitled for Duty Credit Script equivalent to 2% of FOB value of exports.
DUTY EXEMPTION & REMISSION SCHEMES
1)Advance Authorization Scheme:
Allows duty free import of inputs that are physically incorporated in export products.
A minimum of 15% value addition needed for this authorization.
(2)Duty Free Import Authorization Scheme(DFIA)
Allows duty free import of inputs, fuel, oil, energy sources, catalyst required for production of export products.
A minimum of 20% value addition needed for this authorisation.
Duty Remission Schemes:
Enables post export replacement/remission on duty on inputs used in export products.
Transactions in which goods supplied do not leave country
Payment for such supplies received either in Indian rupees or in free foreign exchange
Some categories of supply of goods regarded as “Deemed Exports” under FTP:
- Supply of goods against Advance Authorisation
- Supply of goods to EOU / STP / EHTP / BTP
Export Promotion Capital Goods (EPCG) Scheme
SPECIAL FOCUS INITIATIVES
What Is Convertibility?
Difference Between Current Account and Capital Account
Current accountincludes all transactions related to buying foods and services.
Rupee is convertible on Current A/C
One is free to buy foreign exchange for the purpose of importing goods or services.
Capital account includes all capital transactions like taking loans, purchasing foreign assets, FDI, etc.
Rupee is convertible on Capital A/C
One is free to bring foreign exchange in India to buy assets in India and take foreign exchange outside India to buy assets in foreign countries.
What Is Full Capital Account Convertibility?
Get permission from the Government or RBI
Be it import of
procuring books or
paying fees for a ward who pursues higher studies abroad.
Be it exporter
has to surrender the foreign exchange to RBI and get it converted at a rate pre-determined by RBI.
Government eased the movement of foreign currency on trade account.
Importers and Exporters need not get permission on a CASE TO CASE basis as was prevalent in the earlier regime.
Government liberalized the flow of foreign exchange to include items like amount of foreign currency that can be procured for purposes like travel abroad, studying abroad, engaging the services of foreign consultants etc.