Background

The export and import of goods & services in India are governed by India’s Foreign Trade Policy. Director General of Foreign Trade (DGFT) under the Ministry of Commerce is the regulatory for same. DGFT also issues a detailed Handbook of Procedures including Annexures for the same. The FTPs are generally designed to remain in force for a period of 5 years. The current FTP was formulated in 2015 and was supposed to be in force upto 31^st March 2020. However, due to unprecedented situation arising out of Covid-19 it shall continue to remain in force till 31^st March 2021.  The benefits under the policy which are available to exporters and importers and their proposals for FY 21 are discussed hereinafter. 

Services Export from India (SEIS) Scheme

• Service Exports from India Scheme (SEIS) aims to promote export of services from India by providing duty scrip credit for eligible exports.
• Last date for filing SEIS for F.Y. 2018-2019 shall be 31st December, 2020.
• SEIS scheme shall be in force for Financial Year 2019-2020 as well. However, the services which would be covered under SEIS scheme for the said period will be notified by the Government at a later date.
• Decision regarding whether to continue the SEIS scheme for Financial Year 2020-2021 is still not taken by the government. 

Merchandise Export from India (MEIS) Scheme

• MEIS intends to incentivise exports of goods manufactured in India or produced in India. The incentives are for goods widely exported from India, industries producing or manufacturing such goods with a view to making Indian exports competitive. The incentives under the schemes are calculated as a percentage, which is 2%, 3% or 5% of the realised FOB (free-on-board) value exports in free foreign exchange or FOB value of exports as per shipping bills in free foreign exchange.
• Application for obtaining duty credit scripts under MEIS may be filed within 15 months for shipping bills where Let Export Order (ELO) Date falls during 1st February, 2019 to 31st May, 2019.
• The present MEIS scheme is proposed to be replaced by RoDTEP scheme (‘Remission of Duties and Taxes on Exported Products’) in a phased manner from current financial year.

Advance Authorisation

• The Advance Authorization Scheme is a scheme where the import of inputs is allowed to be made duty-free (after making normal allowance for wastage) if they are physically incorporated in a product which is going to be exported. These have pre-requisite condition of export obligations.
• Imports against advance authorization for physical exports exempted from IGST and Compensation Cess till 31st March 2021.
• Where validity for import or export obligation period is expiring between 1st February 2020 and 31st July 2020, the same will get extended by 6 months automatically.

EPCG Scheme

• This is a Scheme which enables an importer (being an export-oriented unit) to import capital goods at zero rates of customs duty. However, the scheme is subject to condition that export value equivalent to 6 times of duty saved on the import of such capital goods within 6 years from the date of issuance of the authorizations should be bought into India.
• Capital goods imported under EPCG Scheme for physical exports shall be exempt from IGST and compensation Cess till 31st March, 2021.
• Where the validity period for import or submission of installation certificate or export obligation period expires during 1st February 2020 and 31st July 2020, the same will get extended by 6 months automatically.

EOU/EHTP/STP/BTP

• The imports from bonded warehouse in DTA or from international exhibition held in India shall be allowed to be made without payment of custom duty till 31st March 2021.
• LOP/LOI whose validity expires on or after 1st March 2020 shall be deemed to be valid upto 31st December 2020.
• Where export obligation period expires during 1st March 2020 and 30th June 2020, it would be deemed to be valid upto 30^th September 2020.

Gem and Jewellery Sector

• Relaxation in repatriation of sale proceeds period in case of export of branded jewellery and precious metal as provided in Para 4.80 and 4.85A of HBP 2015-20 would be equal to period as allowed plus 6 months, or subject to RBI guidelines, whichever is less.
• Last date for filing Replenishment Authorisation Application extended by 6 months, if the last date of the same is falling between 1^st February 2020 and 31^st July 2020.

Miscellaneous

• Recognition of Pre-shipment inspection agencies valid upto 30th June 2020 in certain cases.
• Date of filing of applications for TED Refund/Drawback extended upto 30th September 2020, in case it falls on after 1^st March 2020.
• RCMC will continue to be valid till 30^th September 2020, even if it has expired on or before 31^st March 2020– DGFT Trade Notice No. 60/2019-20 dated 31st March, 2020.