The Union Ministry of Commerce and Industry will soon come out with a new Foreign Trade Policy which provides guidelines and incentives for increasing exports for FY20-25.
The new policy is likely to be announced by the end of September 2019 or early October 2019. The Ministry is currently giving final touches to the new policy as the validity for the old one will end on 31 March 2020.
The Ministry’s arm Directorate General of Foreign Trade (DGFT) is formulating the policy. The new policy will focus on simplifying procedures for exporters and importers, besides providing incentives to boost exports.
At present, tax benefits are provided under the Merchandise Export from India Scheme (MEIS) for goods and Services Export from India Scheme (SEIS).
In the new policy, changes are expected in the incentives given to goods as the current export promotion schemes are challenged by the US in the dispute resolution mechanism of the World Trade Organisation (WTO).
The Commerce Ministry has also floated a Cabinet note for a new export incentives scheme, Rebate of State and Central Taxes and Levies (RoSCTL) which will be compliant with the WTO norms.
The RoSCTL scheme is available for exports of garments and made-ups and will now be proposed to extend it to all exports in a phased manner.
It will ensure refund of all un-rebated central and state levies and taxes imposed on inputs that are consumed in exports across all sectors.