UPSC Exam   »   Foreign Trade Policy Extended

Foreign Trade Policy Extended


Foreign Trade Policy UPSC: Relevance

  • GS 2: Government policies and interventions for development in various sectors and issues arising out of their design and implementation.


Foreign Trade Policy : Context

  • Recently, the Ministry of Commerce and Industry has further extended the existing Foreign Trade Policy (FTP) till September 30, 2022.
  • Read about record export growth from India.


Foreign Trade Policy 2015: Key points

  • On March 2020, the government had extended the Foreign Trade Policy 2015-20 for one year till March 2021, amid the coronavirus outbreak and the lockdown.
  • The FTP 2015-2020, which came into force on 1 April 2015, was originally meant for 5 years.

विदेश व्यापार नीति विस्तारित

What is Foreign Trade Policy?

  • Foreign Trade Policy is a set of guidelines and instructions established by the DGFT (Director General of Foreign Trade) in matters related to the import and export of goods in India.
  • The foreign trade policy is regulated by foreign trade (development and regulation), Act 1992.
  • Focus area: FTP primarily focuses on adopting a twin strategy of promoting traditional and sunrise sectors of exports including services.


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Objectives of foreign trade policy

  • To boost the economy by facilitating international trade of India.
  • To improve the balance of payment and trade of India.
  • To enhance the trading activities and generate a workforce environment to increase employment in the country.
  • To provide consumers with goods and services of utmost quality and with effective cost.
  • To raise the infrastructure of small-scale industries to reduce the trade imbalance in the country.
  • To establish an advance licensing system to allow duty-free imports.
  • To remove the restrictions on goods and services, and allow them to be freely imported.
  • Digitalization of all the documents to reduce conflict between exporters and DGFT.
  • Ease of access to credits by the start-ups and increasing limits.
  • Canalization of import goods to diversifying market opportunities.


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Features of FTP 2015-20

  • It introduced a new scheme, “Merchandise Exports from Indian Scheme (MEIS)” and “Services exports from India scheme (SEIS)”.
  • Merchandise exports from India (MEIS) to promote specific services for specific FTP.
  • The ‘Services Exports from India Scheme’ (SEIS) is for increasing exports of notified services.
  • The MEIS scheme provides rewards to exporters to offset infrastructural inefficiencies and associated costs.
  • Reduced export obligation to 75% under the EPCG (Export Promotion Capital Goods) scheme.
  • Duty credit scrips are freely transferable and usable for payment of customs duty, excise duty and service tax.



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