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Exim Policy

Exim Policy
 The foreign trade of India is guided by the Export-
Import policy of the Government of India.
 Regulated by The Foreign Trade Development and
Regulation Act 1992.
 Exim policy contain various policy decisions with
respect to import and exports from the country.
 Exim Policy is prepared and announced by the central
 Exim Policy of India aims to developing export
potential, improving export performance, encouraging
foreign trade and creating favorable balance of payment
General Objectives of Exim Policy
 To establish the framework for globalization.
 To promote the productivity competitiveness of Indian
 To Encourage the attainment of high and internationally
accepted standards of quality.
 To augment export by facilitating access to raw
material,intermediate, components, consumables and
capital goods from the international market.
 To promote internationally competitive import
substitution and self-reliance.
Exim Policy of India 2004-2009

 Hon. Shri Kamal Nath minister for commerce and

industry has announced on 31st Aug 2004, India’s
first Exim policy.
The duration of the policy from 1st Sept. 2004 to 31st
March 2009.
It takes an integrated view of the overall
development of India’s foreign trade.
Aim of the policy is to double the global
merchandise trade within the policy time period of 5

Objectives of Exim Policy 2004-2009

 To double our percentage of share of global

merchandise trade within the five year.
 To act as an effective instrument of economic growth
by giving a thrust to employment generation.

Highlights of the New Foreign Trade Policy
 Special Focus Initiatives: Semi-urban and Rural Area
 Agriculture : Vishesh Krishi Upaj Yojana and Agri Export
 Handlooms and Handicrafts: Mark under Market Access
Initiatives Scheme and Proposed to Start new SEZ.
 Gems and Jewellery: Import of gold of 18 carat and above has
been permitted under the replenishment scheme
 Leather and Footwear : Duty free import entitlement of
specified items shall be 5% of FOB value of exports during the
preceding year

 Export Promotion Schemes
– Assistance to States for Infrastructure Development of
Exports [ASIDE]
– Market Access Initiative [MAI]
– Marketing Development Assistance [MDA]
– Towns of Export Excellence
– Target Plus Scheme.
– Served from India Scheme
– Service Export Promotion Council

 New Status Holder Categorization

Category Total Performance

(In Rs)
One Star Export House 15 crore
Two Star Export House 100 crore
Three Star Export House 500 crore
Four Star Export House 1500crore
Five Star Export House 5000 Crore

 Board of Trade: The role is to advising government on
relevant issues connected with Foreign Trade Policy.

Implications of The Foreign Trade 2004-09

 Implications on Indian Economy:

– This policy propose to simplify procedures and develop
technology and infrastructure.
 Implications on Agriculture:
– Special Agricultural Produce Scheme has been introduced for
promoting the export of fruits, vegetables, flowers, and their
value added products.
 Implications on Handlooms and Handicraft:
– Establishment of Handicraft SEZ and Handicraft Export
Promotion Council would promote development of Handloom
and Handicraft Industry.

 Implications on Gem and Jewellery Sector :
– This is special thrust area in this policy.
– Duty free imports of other inputs would give a further boost
to this sector
 Implications on Leather and Footwear Industry :
– Duty free import as a specified percentage of exports.
– Exemption on customs duty on equipment for effluent
treatment plants would help promoting export form this

 Implications on Service Industry :
– An exclusive service promotion council has been set up in
order to map the opportunities for key services in key market.
– Develop strategic market access programmes like brand
building in co-ordination with sectoral players and recognize
nodal bodies of the service industry.

Annual Supplement to Foreign Trade
Policy 2004-09
Minister for Commerce and Industry, Government of
India has announced Annual Supplement 2005, to the
Foreign Trade Policy 2004-09 on the 8th April 2005.

Highlights of the Supplement

 Inter State Trade Council : To engage the State Government in

providing an enabling environment for boosting international
trade, by setting up an Inter State Trade Council.
 Removal of Export Cess : Proposed to abolish cess on export of
all agricultural and plantation commodities levied under various
Commodity Board Acts.
 Export Promotion Capital Goods Scheme (EPCG) : This
scheme is extended to Agricultural sector, SSI sector, Retail
Sectors in order to promote exports from them.
 Service Export : To upgrade infrastructure in the service related

 Agri Export : Benefits under ‘Vishesh Krishi Upaj Yojana’
have been extended to exports of poultry and dairy products in
addition to export of flowers, fruits, vegetables and their value
added products.
 Package for Marine Sector : Duty free import of specified
specialized chemicals and flavoring oils as per a defined list shall
be allowed to the extent of 1% of FOB value of preceding
financial years export.
 Advance Licensing Scheme : The Scope of Advance
License for annual requirement has been extended to all
categories of exporters having past export performance.

 Duty Free Replenishment Certificate : Brass scrap,
Additives, paper board, and dye stuff have been removed from
the list of items prescribed for import under DFRC.
 Procedural Simplification : Proposed to simplify
procedures and reduce the documentation requirements so as to
reduce the transaction cost of the exporters and thereby increase
their competitiveness.
 EDI Initiatives : DGFT shall introduce an automated
electronic system for filing, retrieval and authentication of
documents based on agreed protocols and message exchange
with other authorities such including Customs and banks.

Negative List of Exports 2002-07
The negative list consists of goods, the import or export of which
is ether prohibited, restricted through licensing or otherwise to be
canalized through a designate government agency.
The negative list of exports, as per the EXIM Policy 2002-07
 Prohibited Items : Which items completely banned from the
– All forms of wild animals including their parts and products.
– Special Chemicals as notified by the DGFT.
– Exotic birds as notified by the DGFT.
– Beef.
– Sea Shells, as specified
– Human Skeleton.
– Peacock Tail
– Red sanders wood in any form.
 Restricted Items : which items allowed for exports under
special license issued by the DGFT.
– Dress materials, ready-made garments, fabrics or textile items
with imprints of excerpts or verses of the Holy Quran.
– Horses – Kathiawadi, Marwari, and Manipuri breeds.
– Fresh and frozen silver prom frets of weight less than 300gm.
– Paddy (Rice in husk).
– Seaweeds of all types.
– Chemical Fertilizer all types.

 Canalized Items : can be exported without an export license
through designated State Trading Enterprise
Items Canalizing Agency
Onions (Except Bangalore Rose onion Export Permitted through Specified
and Krishnapuram Onion) STEs
Niger Seeds Tribal Cooperative Marketing
Federation of India (TRIFED) New
National Agricultural Cooperative
Marketing Federation of
Gum Karaya India(NAFED)
Tribal Cooperative Marketing
Federation of India(TRIFED), New
Iron ore, Manganese ore, and Chrome Metals and Minearals Trading
ore. Corporation (MMTC).
Crude Oil Indian Oil Corporation Limited

 Freely Exportable Items : can be exported without an export
license from DGFT. However export of such items is subject to
certain procedures or conditions.
Item Description Procedures or Conditions

Military Stores as notified by No objection certificate from the Department

DGFT of Deface Production and Supplies

Exotic Birds, such as Bangali Subject to Pre- shipment inspection.

finches, White finches and
Bones and bone products Subject to a certificate from chemical and
Allied Products Export Promotion Council
Basmati Rice Subject to registration of contracts with
Agriculture and Processed food Products
Export Development Authority.