Overview of India’s Foreign Trade Policy 2023-28
India’s Union Commerce Minister Piyush Goyal recently unveiled the country’s Foreign Trade Policy 2023-28 with a focus on internationalizing trade in rupees. The new policy came into effect on April 1, 2023, and is expected to have significant implications for India’s economy, including projected increases in exports and a renewed emphasis on e-commerce.
Projected Export Figures and E-Commerce Emphasis
The Director General of Foreign Trade, Santosh Sarangi, has projected that India’s total exports in FY 2023 will surpass $760 billion, a significant increase from $676 billion in 2021-22. The new Foreign Trade Policy 2023-28 is designed to encourage e-commerce export, which is expected to grow to $200-300 billion by 2023. This emphasis on e-commerce export is in line with India’s goal of becoming a leading player in the global digital economy. The policy includes measures to improve the country’s logistics and infrastructure, streamline export processes, and increase the availability of credit for exporters.
Amnesty Scheme and Dairy Sector Exemption
The new Foreign Trade Policy 2023-28 introduces an amnesty scheme for one-time settlement of default in export obligation. This amnesty scheme is expected to help businesses that have been unable to meet their export obligations due to various reasons, such as market fluctuations or other unforeseen circumstances. Additionally, the dairy sector has been exempted from maintaining an average export obligation under the new policy. This move is expected to benefit the dairy industry, which has been facing challenges due to falling milk prices and increasing costs.
New Towns of Export Excellence
As part of the new Foreign Trade Policy 2023-28, Faridabad, Moradabad, Mirzapur, and Varanasi have been identified as new Towns of Export Excellence (TEE). This designation is in addition to the already existing 39 TEEs, and is expected to help boost exports from these regions.
Changes in Export Value Limit and Dynamic Policy
Under the new policy, the value limit for exports through courier services has been increased to Rs 10 lakh from Rs 5 lakh per consignment. This change is expected to benefit small and medium-sized enterprises (SMEs), which often rely on courier services for their exports. The Foreign Trade Policy 2023-28 is designed to be dynamic and responsive to the emerging trade scenario, with no end date to the policy. The Department of Commerce is being restructured to make it “future-ready,” and is expected to play a more proactive role in promoting exports.
Continued Focus on Reaching $2 Trillion in Exports by 2030
The Director General of Foreign Trade, Santosh Sarangi, has reiterated India’s ambition of reaching $2 trillion in exports by 2030. This goal is expected to be achieved through a combination of measures, including the promotion of e-commerce exports, the expansion of export infrastructure, and the development of new markets. In conclusion, the new Foreign Trade Policy 2023-28 is expected to have a significant impact on India’s economy, particularly in the area of exports. The policy’s emphasis on e-commerce, the amnesty scheme, and the exemption for the dairy sector are all measures that are expected to benefit Indian businesses. With continued efforts to reach $2 trillion in exports by 2030, the policy is designed to help India become a leading player in the global economy.