Preeti Sharma
According to Foreign Trade (Development and Regulation) Act, 1992 foreign trade policy basically contain a set of guidelines or instruction of import and export. Its primary purpose is not merely earn to foreign exchange but also to stimulate greater economy activity.Foreign trade policy is formulated, controlled and supervised by the office of the Director General of Foreign Trade (DGFT), an attached office of the Ministry of Commerce & Industry. DGFT has several offices in various parts of the country which work on the basis of the policy formed by the headquarters at Delhi.
Features of foreign trade policy are:-
- Import-export of Goods/Services is free unless prohibited or restricted (absolutely/conditional) in respect of strategic, health, natural resources and other reasons.
However government can give permissions from policy and procedure.
- FTP issues various Promotional Schemes e.g. Reward Scheme, Export Promotional Capital Goods, Duty Exemption Scheme, Duty Remission etc.
- There should be no taxes on exports and hence, the taxes are either exempted or adjusted or refunded on both inputs and outputs, through the scheme of Duty Exemption, Duty Refund.
- FTP provide special provisions for trade with neighboring countries to promote trade and strengthening economic ties.
- FTP provisions cannot override tax laws i.e. it is a supplementary law in nature.
- FTP prohibited second hand goods except second hand capital goods.
- FTP provides :
a) Import of baggage
b) Temporary import of goods,(used/new)
c) Re-import, after repair (No need of authorization of DGFT)
d) “Sale on High Seas Sale” basis
e) Goods imported, Domestic goods purchased for export, No need of Bank guarantee/ LUT
f) Export of goods free : (unless restricted by FTP/ Custom Act)
g) Export of gift ( Maximum value of Ps. 5 Lakh)
h) In case of warehoused goods (Custom bonded warehouse) : duty is to be paid at the time of clearance of goods for home consumption.
i) Export of Repair goods are permitted without any authorization.
j) Realization of export Procedure.
k) No tax procedure in Special Economic Zone.
l) Import Export Code, Authorization, Document submissions etc. all facilities available online.
