INDIAN FOREIGN TRADE POLICY

Paving the way for a Developed Economy

GROUP

MEM

BER

S

GROUP MEMBERSGROUP MEMBERS

Manisha GorakshaManisha Goraksha

Kalpana ManeKalpana Mane

Vasudha JadhavVasudha Jadhav

Sushil SinghSushil Singh

Michelle RodriguesMichelle Rodrigues

Gopal PuriGopal Puri

Ameya YadavAmeya Yadav

Vikrant RaneVikrant Rane

INTR

ODUCTIO

N- EXIM

POLICY

INTRODUCTIONThe Government of India, The Ministry of Commerce and Industry announces Export Import Policy after every five years.EXIM policy, in general, aims at developing export potential, improving export performance, encouraging foreign trade and creating favorable balance of payments position. The current Exim Policy covers the period 2004-2009. Two major objectives were indicated, namely (a) to double our percentage of global merchandise trade within 5 years, and (b) to use trade expansion as an effective instrument of economic growth and employment generation.

CONTD

……

In 2004, India’s exports stood at a little over US $ 63 billion. In 2007-08, they have exceeded US $ 155 billion; the exports are not just double what they were 4 years ago, but 2½ times more. The total merchandise trade of India this year ie. Exports and Imports together accounted for 1.5% of the world trade.The total trade in goods and services is now equivalent to almost 50% of India’s GDP. This is unprecedented in India’s modern economic history.On the issue of employment, it is estimated that during the last 4 years, increased trade activity has created 136 lakh new jobs.

STRATEG

IES

The Principle Strategies of India’s EXIM Policy are:To strengthen the base export production by facilitating access to raw materials, components, capital goods Etc. from the international marketTo place special emphasis on exports to generate high net foreign exchange To simplify and streamline procedures for import licensing and export promotion.To facilitate technological up gradation & modernization of export based industries To promote import substitution and self reliance To provide export incentives so as to encourage the exporter

SPECIALFOCUS

INITIATIVES

Certain Special focus initiatives have been identified for the following sectors :

AGRICULTURE - A new scheme called the Vishesh Krishi Upaj Yojana (Special Agricultural Produce Scheme) for promoting the export of fruits, vegetables, flowers, minor forest produce, and their value added products has been introduced.

HANDLOOMS - Duty free import entitlement of specified trimmings and embellishments shall be 5% of FOB value of exports during the previous financial year.

HANDICRAFTS - Duty free import entitlement of trimmings and embellishments shall be 5% of the FOB value of exports during the previous financial year.

CONTD

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GEMS AND JEWELLERY - Duty free import entitlement of consumables for metals other than Gold, Platinum shall be 2% of FOB value of exports during the previous financial year.

LEATHER AND FOOTWEAR - Duty free import entitlement of specified items shall be 5% of FOB value of exports during the preceding financial year.

MARINE SECTOR - Duty free import of specified specialised inputs / chemicals and flavouring oils is allowed to the extent of 1% of FOB value of preceding financial year’s export.

NEG

ATIVE LIST O

F EXP

ORTS

Negative list of

Export

Prohibited Items

Restricted Items

Canalised Items

Negative list of exports contains those export items which are either banned or cannot be freely exported.

TREN

DS IN

INDIA

’S FOREIG

N

TRADE

EXPORT SCENARIO 2007-2008 (April-Sep 07) India’s export was worth Rs.293964.31 crores during April- September 2007 which was 4.7% higher than the exports, valued at Rs.2,80,765.53 crores during April–Sept 2006.

Top ten commodities exported from India are: 1) Petroleum Products, 2) Gems & Jewellery 3) Basic

Chemicals, 4) Pharma & Cosmetics, 5) Readymade Garments, 6) Machinery and

instruments, 7) Transport Equipment, 8) Manufacture of Metals, 9) Cotton yarn fabrics,

Rubber glass & other products and 10) Primary & Semi finished Iron & Steel.

These ten commodities alone accounted for 67.6% of total exports (Rs.293964.31 crores) from India during the year April – September 2007.

TREN

DS IN

INDIA

’S FOREIG

N

TRADE

The Non - Agricultural sectors contributed a large share of Rs. 1,75,066.03 crores ie. 59.55% to India’s total exports during April- Sept 2007.

% Exports

Exports share (in crores)

Non- Agricultural Sectors

11.58% Rs.34,040.58 Textiles

13.03% Rs.38,311.20 Gems and Jewellery

13.68%Rs.40,213.22 Chemical and related products

21.26%Rs.62,501.03 Engineering Goods

TREN

DS IN

INDIA

’S FOREIG

N

TRADE

Among these groups, the highest growth rate had been reported by (i) Engineering goods (8.29%) followed by (ii) Gem & Jewellery (7.90%) during April – September 2007 as compared to April- September 2006.

Export of Agricultural & Allied Products and Plantation sector contributed an amount of Rs.22204.28 crores (7.55%) to India’s total exports during April – September 2007.

DIR

ECTION O

F EXPORTS

Direction of India’s Exports:

Top ten countries to which Indian goods were exported during April- Sept 2007 : 1) U.S.A, 2) United Arab Emirates, 3) China, 4) U.K., 5) Singapore, 6) Hong Kong ,7) Germany, 8) Netherlands, 9) Belgium and 10) Italy.

Total exports to these ten countries amounted to Rs.1,56,114.86 crores, thereby sharing 53.1% contribution in India’s total exports.

Out of five major regions of exports markets, Asia & ASEAN with a share of 49.95% has emerged as the major export market for India’s trade followed by Europe (23.01%), America (17.80%), Africa (7.70%) and CIS & Baltic (1.03 %).

TREN

DS IN

INDIA

’S FOREIG

N

TRADE

IMPORT SCENARIO 2007-2008 (April- Sep 07)India’s total imports increased from Rs.401262.38 crores in April – Sept 2006 to Rs.456103.47 crores in April- Sept 2007 registering an increase of 13.67% during the year.

The given ten commodities accounted for about 78.8% of the total imports made by India during April– Sep 07. They are as follows:

1) Petroleum crude & Products, 2) Gold & silver, 3) Electronic Goods, 4) Machinery other than

Electrical, 5) Organic & Inorganic Chemicals, 6) Pearls,7) Precious & Semi-precious stones, 8) Iron & Steel, 9) Metalliferrous Ores & Products,

Coal, Coke & briquettes and 10) Transport Equipment.

TREN

DS IN

INDIA

’S FOREIG

N

TRADE

IMPORT OF PRINCIPAL COMMODITIES

India’s imports of principal commodities are broadly categorised in five major groups namely

I) Bulk imports ii) Machinery iii) Pearls, Precious & Semi-precious Stones iv) Project goods and v) Others.

Out of these Bulk imports accounted for 44.89%, Machinery 11.79%, Pearls, Precious & Semi-precious Stones accounted for 4.22%, Project goods for 0.52% and the remaining commodities accounted for 38.57%.

TREN

DS IN

INDIA

’S FOREIG

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TRADE

% Inc in ImportsPrincipal Goods Imported

52.5%Others (Coal, coke & briquettes, Artificial Resins, Electronic goods, Professional Instruments)

13.25%

34.57%,

23.49%

14.52%

Machinery

Transport Equipment

Machine tools

Electrical machinery

16.24%Precious/Semi- Precious Stones

36.22%

36.0%

18.31%

11.51%

4.09%

1.55%

Bulk ImportsFertilizers Manufactured

Iron & Steel

Edible oil

Non ferrous metals

Petroleum crude and products

Metalliferrous Ores & Products

DIR

ECTION O

F IMPORTS

Direction of India’s Imports

Imports were made mainly from the five regions viz. i) Asia & ASEAN ii) Europe iii) America IV) Africa and v) CIS & Baltic.

Of India’s total imports during April- Sep 07 from these regions, Asia & ASEAN occupies the top rank with a share of 61.13% followed by Europe 21.20%, America 9.05%, Africa 6.68% and CIS & Baltic 1.58%.

Europe, Asia & ASEAN, America, Africa, CIS & Baltic and have positive growth rates of 23.65%, 11.80%, 11.56%, 8.22%, and 1.11% respectively.

Conclusion

Purpose

Coherence and consistency.

CONCLUSIO

N

EmploymentImports Indian Trade has grown tremendously due to current Indian Foreign Trade Policy.

SOUR

CES OF IN

FORM

ATIO

N

WEBLIOGRAPHY

http://dgftcom.nic.in/exim/2000/statrep/rep0708/chap2.pdfhttp://dgft.gov.in

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