The document outlines the key objectives and features of India's Foreign Trade Policy for 2015-2020. The policy aims to provide a stable trade environment, link trade initiatives to other government programs, diversify exports, expand markets, and reduce the trade imbalance. It merges previous incentive schemes into new Merchandise and Services Export schemes that provide duty credits to exporters. The policy also extends incentives to Special Economic Zones and makes duty credit scrips freely transferable and usable for customs, excise, and tax payments.

1. FOREIGN TRADE POLICY(FTP)2015-2020

2. Foreign trade is exchange of capital, goods, and services across
international borders or territories. In most countries, it represents a
significant share of gross domestic product (GDP). The Foreign Trade
Policy is largely focused on stimulating exports. This is pursued to be
realized through numerous schemes intended to exempt and remit indirect
taxes on inputs physically combined in the export product, import capital
goods at concessional duty, accelerate services exports and emphasis on
specific markets and products.
On 1st April 2015, the new Foreign Trade Policy (FTP) for the period
2015-20 was announced which replaces the 2009-14 FTP which expired on
31st March 2014. The new policy attempts to combine 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.

3. OBJECTIVES OF THE FTP 2015-2020
The FTP for 2015-2020 seeks to achieve the following objectives:
• To provide a stable and sustainable policy environment for foreign trade in
merchandise and services;
• 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;‟
• 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;

4. • 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;‟
• To provide a mechanism for regular appraisal in order to rationalise
imports and reduce the trade imbalance.

5. In order to achieve these objectives, the way forward requires measures to:
• Help improve India’s export competitiveness and deepen engagements
with new markets;
• Operationalise institutional mechanisms in existing bilateral and regional
trade agreements;
• Deepen and widen the export basket;
• Reduce transaction costs;
• Make efforts to reduce the cost of export credit;
• Help improve infrastructure eg. ports, laboratories and Common Facility
Centres;
• Promote product standards, packaging and branding of Indian products;
• Rationalise tax incidence - introduce the Goods and Services Tax (GST);

6. • Help improve manufacturing by mainstreaming exports;
• Incentivise potential winners for promising markets;
• Promote and diversify Services Exports; and
• Mainstream States and Ministries in India’s Export Strategy.
These measures cut across several Departments and Ministries of the
Government of India and also State Governments. The success of trade
policy is critically dependent on the coordinated efforts of the Government
of India as a whole as well as State Governments.

7. • Merchandise Export from India Scheme: The six different schemes of
the earlier FTP (Focus Product Scheme, Market Linked Focus Product
Scheme, Focus Market Scheme, Agriculture Infrastructure Incentive Scrip,
Vishesh Krishi and Gram Udyog Yojana and Incremental Export Incentive
Scheme) which had varying sector-specific or actual user only conditions
attached to their use have been merged into a single scheme, namely the
Merchandise Export from India Scheme (MEIS). Notified goods exported
to notified markets will be incentivized on realized FOB value of exports.
Countries have been grouped into three categories--namely Category A:
traditional markets, Category B: emerging & focus markets and Category
C: other markets--for grant of incentives. The government has expanded
the coverage of the MEIS on 29 October 2015 by adding 110 new items.
The incentive rate/country coverage of 2228 items has been enhanced.
SALIENT FEATURES OF THE FTP 2015-
2020

8.
• Service Export from India Scheme: The Served from India Scheme
(SFIS) has been replaced with the Service Export from India Scheme
(SEIS). The SEIS applies to ‘service providers located in India’ instead of
‘Indian service providers’. Thus it provides for incentives to all service
providers of notified services who are providing services from India,
regardless of the constitution or profile of the service provider. The rates of
incentivization under the SEIS are based on net foreign exchange earned.
The incentive issued as duty credit scrip, will no longer carry an 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.

9. • Incentives (MEIS & SEIS) to be available for SEZs: FTP 2015-20
extends the benefits of the MEIS and SEISto special economic zones
(SEZ) as well, which will give a new impetus to the development and
growth of SEZs.
• Duty credit scrips are freely transferable and usable for payment of
custom duty, excise duty and service tax: All scrips issued under the
MEIS and SEIS and the goods imported against these scrips are fully
transferable.

10. CONCLUSION
• India is presently known as one of the most important players in the global
economic landscape. Its trade policies, government reforms and inherent
economic strengths have attributed to its standing as one of the most
sought after destinations for foreign investments in the world.
• Boosted by the forthcoming FTP, India's exports are expected reach US$
750 billion by 2018-2019 according to Federation of India Export
Organisation (FIEO).