Indian Sinario, Trade policy, Legal provisions, phases

1. PRESENTATION ON
TRADE POLICY
Presented by
Muntaha Qadri
Roll no. 18

2. TRADE POLICY (TRADE PROTECTION)
 Trade policy is a collection of rules and
regulations which pertain to trade (export,
import policy; foreign exchange regulation).
 Every nation has some form of trade policy in
place, with public officials formulating the
policy which they think would be most
appropriate for their country.
 The purpose of trade policy is to help a
nation's international trade run more smoothly,
by setting clear standards and goals which can
be understood by potential trading partners.

3. Things like
• Import and export taxes,
• tariffs,
• inspection, regulations, and
• quotas can all be part of a nation's trade
policy.
 Some nations attempt to protect their local industries
with trade policies which place a heavy burden on
importers, allowing domestic producers of goods and
services to get ahead in the market with lower prices or
more availability.

4. ROLE OF TRADE POLICY
 Help nascent industries thrive.
 Diversification of industries. It serves as a means
against technological, economic, political
fluctuations.
 Employment generation
 Terms of trade are improved by tariff imposition, i.e.
greater gain from trade.
 Protection against dumping activity.

5. TRADE ORGANISATIONS
• The General Agreement on Trade and Tariff
(GATT) came into existence in 1947
• It sought substantial reduction in tariff and other
barriers to trade and to eliminate discriminatory
treatment in international commerce.
• India stood as a signatory to GATT (1947) along
with twenty two other countries.

6. WTO Came into existence on 1-1-1995 with the
conclusion of Uruguay Round Multilateral Trade
Negotiations at Marrakesh on 15th April 1994, :
AIM:
• Transparent, free and rule-based trading system
• Provide common institutional framework for
conduct of trade relations among members
• Facilitate the implementation, administration and
operation of Multilateral Trade Agreements
• Rules and Procedures Governing Dispute
Settlement
• Trade Policy Review Mechanism
• Concern on Non-trade issues such as Food
Security, environment, health, etc.

7. Indian Scenario

8. ORGANISATIONAL SETUP
 The mandate of the Department of Commerce is
regulation, development and promotion of India’s
international trade and commerce through formulation of
appropriate international trade & commercial policy and
its implementation which provides the basic framework of
policy and strategy to be followed for promoting exports
and trade.
 The Trade Policy is periodically reviewed to incorporate
changes necessary to take care of emerging economic
scenarios both in the domestic and international
economy.

9.  The Department is functionally organized into the following
eight Divisions:
 1. Administration and General Division
2. Finance Division
3. Economic Division
4. Trade Policy Division
5. Foreign Trade Territorial Division
6. State Trading & Infrastructure Division
7. Supply Division
8. Plantation Division.
 The various offices/ organizations under the administrative
control of the Department are: (A) three Attached Offices, (B)
eleven Subordinate Offices, (C) ten Autonomous Bodies, (D)
five Public Sector Undertakings, (E) Advisory Bodies, (F)
fourteen Export Promotion Councils and (G) other
Organizations.

10. COMPOSITION
 Import:
A) Bulk Items:
1. Petroleum, oil and lubricants(POL).
2. Bulk Consumption goods and Other bulk items
B) Non-bulk Items:
Capital goods, Other Export related items
 Export:
1. Agriculture and allied products.
2. ores and minerals.
3. Manufactured Goods.
4. Minerals, fuels and lubricants.
Services and financial services aren't generally shown.

11. LEGAL PROVISION:
 Foreign trade Development and Regulation Act-
FTDR, 1992 was enacted with a view to augment
exports, facilitating imports and take care of matters
related thereto.

12. PHASES
 Phase I: 1951-1980
 Restrictive trade policy,
 Inward looking.
 Protection of infant industries.
 Licensing, canalisation.
 Few items imported, high import duties.
 Export too required govt. permission.

13. Phase II: 1980s
 policy of over protection shunned.
 Reduction in the list of prohibited imported items.
 Export/ Import licensing was eased.
 Reduction in abnormally high import duties.
Phase III: 1990s onwards:
 Massive liberalisation of trade policy.
 Quantitative restriction on import of huge number of
items reduced.
 Complete removal of import duty on a number of
items.

14. TRADE POLICY 2004-09
 During the previous Trade Policy i.e. 2004-09
exports growth reached a level of US$ 168 billion in
2008-09 from US$ 63 billion in 2003-04.
 share of global commercial services export was
1.4% in2003; it rose to 2.8% in 2008.
 India’s total share in goods and services trade was
0.92% in 2003; it increased to 1.64% in 2008.
 On the employment front, studies have suggested
that nearly 14 million jobs were created directly or
indirectly as a result of augmented exports in these
five years.

15. TRADE POLICY 2009-14
 The short term objective of trade policy is to arrest and
 reverse the declining trend of exports and to provide additional
support to those sectors which have been hit badly by recession in
the developed world.
 objective of achieving an annual export growth of 15% with an
annual export target of US$ 200 billion by March 2011 has been
set.
 In the remaining three years of this Foreign Trade Policy i.e.
upto 2014, India should be able to come back on the
high export growth path of around 25% per annum.
 By 2014, India expects to double exports of goods and services.
The long term policy objective for the Government is to double
India’s share in global trade by 2020.

16.  In order to meet these objectives, the Government
would follow a mix of policy measures including
fiscal incentives, institutional changes, enhanced market
access across the world and diversification of export
markets.
1. Improvement in infrastructure related to exports;
2. bringing down transaction costs, and
3. providing full refund of all indirect taxes and levies
would be the three pillars, which will support India to
achieve this target.

17. Thank you