Previous
Inward looking trade policies were replaced by the EXIM policy in April, 1992.
Government of India Introduced the EXIM Policy to bring liberalization in
Imports and boost the Exports. This was bringing along a new era in India’s
foreign trade.

About
the Foreign trade policy (EXIM Policy):

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·        
The Director General of
Foreign Trade (DGFT) establishes guidelines for Import and Export of Goods.

·        
Foreign Trade development
and Regulation Act, 1992 regulates the policy.

·        
Import Export procedures,
promotional measures, related policies are documented in EXIM Policy

·        
The modifications in the
EXIM Policy are announced by the Union Minister of Commerce.

·        
Government of India Notifies policy in
every 5 years since year 1992.

Objectives
of the EXIM Policy:

EXIM
Policy divided into two;

·        
Import policy: regulation
and management of imports

·        
Export policy: promotion
and regulation of exports

 

EXIM
Policies post liberalization:

1.     
Exim
Policy 1992 -1997

·        
To bring stability and
continuity, the Export Import Policy was made for the duration of 5 years. The
earlier policies were made for a period of 3 years and hence less stable

·        
Any amendments are made
by Central Government in the interest of public.

·        
Important step towards
economic growth in India.

2.     
Exim
Policy 1997 – 2002

·        
New Export Import Policy
was need for the smooth functioning of the Indian export import trade.

·        
Import has been further
liberalized. The duty was reduced from 15% to 10% on importing capital goods.

·        
Practices promoting
Indian exports in international trade were introduced. Licensing requirements
were reduced; restrictions on quantity were reduced, free import and export of
goods (except goods in negative list).

·        
provision of additional
SIL of 1 % for export of agro products

·        
encourage foreign
investment in India by permitting 100% equity participation in EOUs

·        
Encouraged Indian
industries to undertake research and development programmers and upgrade the
quality of their products.

·        
encouraging domestic
sourcing of raw materials, in order to build up a strong domestic production
base.

 

3.     
Exim
Policy 2002 – 2007

·        
It took the foreign trade
dealings to a level where both Merchandise and services were imported and
exported.

·        
Business firms providing
exporting services were given a status of service providers w.e.f. 1.4.1999.

·        
To provide access to
essential inputs for production and hence attain sustainable economic
development.

·        
To combine the
technological and local strength enhancing efficiency in Indian agriculture,
service industry.

·        
Creating healthy
competitions by creating opportunities.

·        
Making internationally
acceptable standards of quality accessible.

Thus
the Main objective of EXIM Policy or Foreign Trade Policy is:

·        
Maintain and promote foreign
trade.

·        
Provide Resources which
have worldwide acceptable standards.

·        
Attain economic
development through foreign trade

 

In
the Year 2004, then Industry and
commerce minister, Kamal Nath Changes the name of EXIM Policies to Foreign trade policies. Reason behind
was it was more appropriate to call it a foreign trade policy as the policy
needed to go beyond Exports and Imports. It was a step towards having an integrated
approach towards development of India’s Foreign Trade.

An
Annual revision is brought into the foreign trade policies as the trade
environment is dynamic and ever changing. The situations require quick
responses and hence, annual revisions (also known as Interim Policies) are brought
into.

The
current foreign trade policy covers the time period starting from Year 2015 to
2020 focusing on digitalization and Make in India.