Foreign Trade Policy 2023 (‘FTP 2023’). The FTP 2023 was released on March 31, 2023 by the Ministry of Commerce. This time, the Ministry of Commerce has broken the tradition of issuing a five-year policy. Instead, issued a policy without a sunset clause, which would be updated as and when necessary. FTP 2023 focuses on continuity of earlier schemes, export promotion through collaboration of exporters etc., ease of doing business, reduction in transaction cost, promoting e-commerce and developing districts as export promotion hubs. New policy will be effective from April 1, 2023.

Key highlights of FTP 2023 are as below:

• Export incentive schemes (MEIS / SEIS) are done away with and tax remission schemes (RoDTEP) to continue: In place of MEIS scheme, RoDTEP is already in place to provide tax remission on export of merchandise. However, no measures to promote the service industry are introduced.
• Time tested schemes for export promotion i.e., EOU/STPI/Advance Authorization/ DFIA/ EPCG Schemes are continued: Said schemes are continued in its earlier form with minor tweaking.
• Introduced Amnesty Scheme for default in fulfillment of export obligation: This scheme is applicable for Advance Authorisation and EPCG Authorisation holders who have not fulfilled the export obligations fully or partially. Relief is given in the form of interest waiver and this will benefit cases where interest amount is more than the amount of duty payable. Also, waiver is given from payment of interest on Additional Custom Duty and Special Additional Custom Duty. Detailed modalities of the scheme are yet to be notified.
• Introduced automatic system-based approval of FTP applications: Applications for Advance Authorisation, EPCG Authorisation, revalidation of authorisations and EO extension are to be approved automatically and approvals are to be issued in a day’s time.
• Application fees and composition fees payable by MSMEs for Advance Authorisation and EPCG Authorisation reduced: Application fee is reduced substantially to help MSMEs. This would benefit 55-60 percent of exporters who are MSMEs and are availing the benefits under duty exemption schemes.
• Export performance threshold reduced for status house certificates: Threshold limit for obtaining three star and above certificate is reduced substantially. This would enable exporters to obtain higher status certificates with existing turnover, enjoy additional privileges and thereby reducing the transaction cost for exports.
• Introduced measures to boost e-commerce exports: Value limit for exports through courier service increased from 5 lakhs to 10 lakhs per consignment. Policy is designed to help e-commerce aggregators for easy stocking, customs clearance and return processing.
• Plan to develop districts as export hubs is laid down: The policy focuses on identification of products and services in each district of the country. It proposes to converge ongoing schemes and conduct export promotion programmes in each district.
• Streamlining SCOMET policy: Policy for export of dual use items under Special Chemicals, Organisms, Materials, Equipment and Technologies (SCOMET) consolidated at one place for ease of understanding and compliance by industry. Focus is on simplifying policies to facilitate export of dual use high end goods/technology such as UAV/Drones, Cryogenic Tanks, Certain chemicals etc.