1. EXIM Policy
Export Import Policy is two fold, one within the organization and the second is the larger EXIM policy adopted for the nation
EXIM Policy of a nation is not of recent origin but dates back to 1970
Govt accorded exports and its due importance by formulating the policy
Its is known as Export Policy Resolution, 1970

2. FEATURES OF EXPORT POLICY RESOLUTION
Making Indian products competitive
Modernizing machinery
Improving quality control
Providing marketing support
Providing adequate and timely finance
Providing adequate shipping facilities at reasonable freight rates

3. EXIM Policy
The primary objective of the EXIM Policy or FTP is not only to regulate the exports and imports, but to spur economic growth
The Handbook of Procedures is published as a supplement to the Import/ Export Policy of the Government
EXIM Policy , tenure of 3 years followed by the next policy period of This policy concentrated on steps to liberalize international trade

4. Policy to expire by 31st March, 1991
Policy to expire by 31st March, However was revised one year earlier due to political changes.
New EXIM Policy announced which was then changed to be a policy with a tenure of 5 years. Hence the New EXIM Policy was formulated and announced.
Tremendous changes in the EXIM Policy from 1991 onwards with the issues of Devaluation, Trade Policy Reforms

5. OBJECTIVES OF EXIM POLICY
To strengthen the base for export production and thereby to create sound and favorable situation for export promotion through diversification
To facilitate technological up gradation and modernization of domestic production
To reduce imports to conserve foreign exchange

6. To simplify and streamline foreign trade procedures
To impart stability and continuity to enable exporters to draw long term export plans and strategies
To provide institutional support to export initiatives
To offer different types of export incentives, concessions and facilities to encourage exporters

7. India’s Foreign Trade since 1951
Increased imports since independence caused due to the demand after 2nd World War.
Increased consumption
Five year plans implemented
Focused on import substitution
Each plan period concentrated on individual sector growth.

8. DEVELOPMENT OF FOREIGN TRADE POLICY
Control of foreign trade initiated after second world war
Concentrate on restricting imports initially in the Defence
Sep 1946, Emergency Provisions(Continuance) Ordinance Act for import control
Replaced by Imports & Exports Control 1947
Fluctuations in the tenure of EXIM policy
Finalized in 1992( ) to have 5 year policy
Foreign Trade (Dvpt & Regn)Act,1992

9. GLOBAL ECONOMY
Inspite of the turmoil in the world capital market, the global mkt kept growing since 1997
Growth of world trade and GDP was high in 1997 than ever in 90s
Indicator of this economic expansion is the per capita income growth recorded by most of the developed countries
126, out of 153 WTO member countries, have registered increase in per capita income
The year 2001 witnessed an unexpected decline in world trade which fell down by 1.5% ever since but this got reversed by 2001
A good yardstick for the measurement of World economy is GDP which can be defined as “ Sum total of the value of all goods and services produced in the country”.

10. RESULTS OF THE DVPT IN FOREIGN TRADE
Goods or services provided are expected to be of international quality and price
Service sector has grown and is now 20% of the world trade
Imports are allowed for certain Commodities
Explosion in the visual and written media made people demand high quality goods and as per convenience
The growth of Information technology industry has touched the life at all levels

11. IMPACT OF RECENT CHANGES IN THE DVPT OF FOREIGN TRADE
Dismantling of industrial license which enabled most of the entrepreneurs to decide on the productive ventures
Allowing foreign investment without setting limit
Allowing NRI and FII to invest in industries
Free flow of technology for modernizing and upgrading industries
Removal of certain restrictions on imports with reduction in tariff rates
Full convertibility of Indian rupee on the trade account
Allowing the retention of forex earnings by exporters for meeting their expenses
Allowing private ventures in the field of banking, civil aviation and telecom
Private sector investment in Oil, Refining, exploration, marketing and in other infrastructural dvpt’s

12. Reasons for increase in imports
Shortage of food grains
Import of capital goods & technical know-how, plant & machinery.
War with neighboring countries increased defence needs.

13. Reasons for slower growth of exports
Failure of crops
Synthetic substitute
Fierce competition
Policy of protection followed by developed and developing countries
Reduction in export prices
Reduction in exportable surplus
Increased consumption of manufactured goods
Inflation

14. Composition of India’s Foreign Trade
Import structure
- capital goods
- raw materials and intermediate goods
- consumer goods and food grains
2. Major items of imports
- food grains
- machinery & transport equipments
- mineral oil
- metals
- medicines and chemicals
- fertilizers

15. 3. Export structure
- food, beverages and tobacco
- raw materials
- manufactured goods
4. Major export items
- jute
- cotton
- leather
- iron ores
- engineering goods
- handlooms and handicrafts
- chemical products
- fruits, vegetables, sugar, unmanufactured tobacco, mica, etc.

16. EXIM Policy
Main trust of the policy was to remove unnecessary controls and restrictions on imports and exports
Making the export trade procedures simple, transparent and easy to understand and administer
Policy Aims:
To accelerate country’s transition to an internationally oriented economy with a view of securing maximum benefits from expanding global market opportunities
To augment the productivity, modernization and competitiveness of Indian industry to enhance the potentialities and capabilities

17. To stimulate India’s exports by facilitating access to required raw material, components, etc
To encourage the attainment of internationally accepted standards of quality
To encourage import substitution
To minimize quantitative restrictions
To strengthen country’s Research & development capabilities.

18. 1992 -97 POLICY FEATURES Valid for 5 years and not for 3 yrs
Linked with 8th five yr plan
Govt has made the procedure simple, transparent and easy to administer
Main thrust was to remove unnecessary controls and restrictions on imports and exports.
Contains a number of new incentives for export growth
80% of old restrictions have been removed indicating the extent of liberalization
Import duty on capital goods has been reduced with an increased export obligation
Deemed exports have been accorded a special import license
Substantially eliminates licensing and discretionary controls by introducing negative list of items, imports and exports of which is either prohibited or restricted

19. Reducing negative list means encouraging exporters and importers to undertake trading activities freely in the case of large number of commodities
Thrust of the policy is a drastic reduction in import control
Manufacturers of export oriented goods can import machines, technology, etc. without procedural delays.
Scope of Duty Exemption Scheme has been enlarged by introducing value based advance licence besides the quality based advance licence.
EOUs and units under EPZs are given
(i) special treatment and incentives,
(ii) greater autonomy and flexibility,
(iii) can install any machinery, own or leased,
(iv) allows inter unit transfer

20. Deemed exports have been defined and benefits such as duty exemption schemes, duty drawback schemes and exemption from terminal excise duty have been extended to deemed exports.
Certain categories of exports and exporters are eligible to receive special import licences
Two windows are opened for concessional duty imports under EPCG scheme.
(i) The 1st window provides concessional customs duty of 25% with export obligation 3 times the value of CIF for a period of 4 yrs
(ii) The 2nd provides for 15 % duty with export obligation 4 times the CIF value to be met in 5 yrs
Partial convertibility of the rupee provides that all imports, barring those of canalised items are to be funded by foreign exchange obtained at a market determined rate.

21. IMPLICATIONS OF EXIM POLICY 1992-97
Decline in protectionist measures
- import tariff reduction and liberalised
measures
- Declining protectionist measures for
domestic industry
Emerging buying markets
- entry of MNC, stiff competition
- shift from sellers market to the buyer’s market
- domestic marketers facing growing challenges
Added thrust to exports providing higher efficiency on part of Indian firms.

22. Globalisation of Indian Foreign trade
Technological upgradation
Implication of liberalised imports
Implication of decanalisation
International competitive import sustitutiton
Procedural simplification
Foreign investment policy
Private bonded warehouse
Implication of Zero duty under EPCG scheme
Expansion of Deemed exports

23. HIGHLIGHTS OF 2002-2007 POLICY Objectives
To facilitate sustained growth in exports to attain a share of at least 1% of global merchandise trade
To stimulate sustained economic growth by providing access to essential raw materials, intermediates, components, consumables and capital goods required for augmenting production and providing service
To enhance technological strength and efficiency of Indian Agriculture sector
Improving competitive strength while generating employment opportunities
Attain internationally accepted quality standards
Providing consumers good quality goods and services

24. GENERAL PROVISIONS i. Exports and imports
Shall be free unless restricted
ii. Procedure
As per Handbook of procedures
iii. Restricted Goods
May be traded on obtaining Special licence/ certificate/ permission
iv. State Trading
Canalised items to be traded through exclusive or special privileges
v. IEC No
vi. Actual user condition
vii. Second hand goods
viii. Realisation of export proceeds
ix. RCMC

25. EOU/ EHTP/STP Eligibilty
Units undertaking to export their entire production of goods and services, expect permissible sales in DTAs
Second hand Capital goods
Imported duty free without age limit
Sale in DTA
50% of FOB value of goods can be sold on fulfilling the export obligation
Entitlement of supplies from DTA
Supply from DTA to EOU/ EHTP/ STP units will be treated as Deemed Exports. Concessions to DTA units on such transfer are:
i) Reimbursement of CST
ii) Exemption from payment of Central Excise Duty on all goods
iii) Reimbursement of duty paid on fuels procured from domestic oil companies
iv) Eligible for grant of Replenishment licence

26. Other entitlements of EOU/ EHTP/STP units
i) Exemption from payment of Income Tax
ii) Clubbing of FOB value of export of an EOU/ EHT/ STP with FOB
value of export of its parent company in the DTA or vice versa for
the purpose of according Registered exporters and status
iii) 100% FDI in manufacturing sector
iv) Software units allowed to use system for training purpose but not
to be installed outside the bonded premises
v) Exemption from industrial licensing for SSI sector

27. Inter unit transfer
i) permitted
ii) Capital goods may be transferred or given on loan to other units on prior permission of concerned Development Commissioner
Sub- Contracting
i) Through job work to other EOU/EHTP/STP
ii) May also be permitted abroad
iii) Permission from the concerned Development Commissioner
iv) Scrap/ waste/ remnants generated through job work to be cleared from the job work premise on payment of applicable duty or destroyed in the presence of the authorities.

28. Sale of unutilized Material
i) Transferred to other EOU/EHTP/STP or disposed in DTA on payment of applicable duties and submission of the licence
ii) Capital goods and spares will be
allowed depreciation
iii) No duty applicable for goods destroyed with customs concurrence
Reconditioning, Repair and Re-engineering
i) Activities carried out in freely convertible
foreign currency
ii) Few concessions not available to these units

29. i) Subject to payment of duties
Exit from EOU scheme
i) Subject to payment of duties
ii) If export obligation not attained, penalty may be imposed by the competent authority
Conversion
i) Existing DTA may apply for cinversion but no concessions for plants and machineries already installed
ii) Can be merged

30. SEZ SCHEME
Definition: Specifically delineated duty free enclave and shall be deemed to be foreign territory for the trade operations and tariffs
Status: Goods and services going from SEZ to DTA or vice versa treated as exports or imports as the case may be
NFE
Positive NFE= A-B>0
A is the FOB value of exports of SEZ
B is the CIF value of the imported inputs, capital goods and value of payments made in foreign currency for commission, royalty, fees, dividends, interest on external borrowings, etc