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Exim Policy 2002-07: Highlights
(IV) Growth Oriented
a) Strategic Package for Status Holders
The status holders shall be eligible for the following new/ special facilities:
Licence/Certificate/Permissions and Customs clearances for both imports and exports on self-declaration basis.
Fixation of Input-Output norms on priority;
Priority Finance for medium and long term capital requirement as per conditions notified by RBI;
Exemption from compulsory negotiation of documents through banks. The remittance, however, would continue to be received through banking channels;
100% retention of foreign exchange in Exchange Earners’ Foreign Currency (EEFC) account;
Enhancement in normal repatriation period from 180 days to 360 days.
b) Neutralising high fuel costs
I. Fuel costs to be rebated by it in Standard Input Output Norms (SIONs) for all export products. This would enhance the cost competitiveness of our export products. The value of fuel to be permitted as a percentage of FOB value of exports for various product groups is as under:
c) Diversification of markets
Setting up of "Business Centre" in Indian missions abroad for visiting Indian exporters/businessmen.
ITPO portal to host a permanent virtual exhibition of Indian export product.
iii) Focus LAC (Latin American Countries) was launched in November, 1997 in order to accelerate our trade with Latin American countries. This has been a great success. To consolidate the gains of this programme, we are extending this upto March, 2003.
Focus Africa is being launched today. There is tremendous potential for trade with the Sub Saharan African region. During 2000-01, India’s total trade with Sub Saharan African region was US$ 3.3 billion. Out of this, our exports accounted for US$ 1.8 billion and our imports were US$ 1.5 billion. The first phase of the Focus Africa programme shall include 7 countries namely, Nigeria, South Africa, Mauritius , Kenya, Ethiopia, Tanzania and Ghana. The exporters exporting to these markets shall be given Export House Status on export of Rs.5 crore.
v) Links with CIS countries to be revived. We have traditional trade ties with these countries . In the year 2000-01, our exports to these countries were to the extent of US$ 1082 million. In this group, Kazakhstan, Kyrgyzstan, Uzbekistan, Turkmenistan, Ukraine and Azerbaijan to be in special focus in the first phase.
d) North Eastern States, Sikkim and Jammu & Kashmir
Transport subsidy for exports to be given to units located in North East, Sikkim and Jammu & Kashmir so as to offset the disadvantage of being far from ports.
e) Re-location of industries
To encourage re-location of industries to India, plant and machineries would be permitted to be imported without a licence, where the depreciated value of such relocating plants exceeds Rs. 50 crores.
(V) Reduction in transaction time & cost
With a view to reducing transaction cost, various procedural simplifications have been introduced. These include:
DGFT
A new 8 digit commodity classification for imports is being adopted from 1st April 2002. This classification shall also be adopted by Customs and DGCI&S shortly. The common classification to be used by DGFT and Customs will eliminate the classification disputes and hence reduce transaction costs and time. Similarly, Ministry of Environment and Forests is in the process of finalisation of guidelines to regulate the import of hazardous waste.
Further simplification of all schemes.
Reduction of the maximum fee limit for electronic application under various schemes from Rs. 1.5 lakh to Rs. 1.00 lakh.
Same day licensing introduced in all regional offices.
Customs
Adoption and harmonisation of the 8 digit ITC(HS) code.
The percentage of physical examination of export cargo has already been reduced to less than 10 percent except for few sensitive destinations.
The application for fixation of brand rate of drawback shall be finalised within 15 days.
Banks
Direct negotiation of export documents to be permitted. This will help the exporters to save bank charges.
100% retention in EEFC accounts.
The repatriation period for realisation of export proceeds extended from 180 days to 360 days. The facility is already available to units in SEZ and exporters exporting to Latin American countries.
These facilities are being made available to status holders only for the present.
(VI) Trust Based
Import/Export of samples to be liberalised for encouraging product upgradation.
Penal interest rate for bonafide defaults to be brought down from 24% to 15%.
No penalty for non-realisation of export proceeds in respect of cases covered by ECGC insurance package.
No seizure of stock in trade so as to disrupt the manufacturing process affecting delivery schedule of exporters.
Foreign Inward Remittance Certificate (FIRC) to be accepted in lieu of Bank Realisation Certificate for documents negotiated directly.
Optional facility to convert from one scheme to another scheme. In case the exporter is denied the benefit under one scheme, he shall be entitled to claim benefit under some other scheme.
Newcomers to be entitled for licences without any verification against execution of Bank Guarantee.
(VII) Duty neutralisation instruments
a) Advance Licence
Duty Exemption Entitlement Certificate (DEEC) book to be abolished. Redemption on the basis of Shipping bills and Bank Realisation Certificates.
Withdrawal of Advance Licence for Annual Requirement (AAL) scheme as problems were encountered in closure of AAL and the significance of scheme considerably reduced due to dispensation of DEEC. The exporters can avail Advance Licence for any value.
Mandatory spares to be allowed in the Advance Licence upto 10% of the CIF value.
b) Duty Free Replenishment Certificate (DFRC)
Technical characteristics to be dispensed with for audit purpose.
c) Duty Entitlement Passbook (DEPB)
Value cap exemption granted on 429 items to continue.
No Present Market Value (PMV) verification except on specific intelligence.
Same DEPB rate for exports whether as CBUs or in CKD/SKD form,
Reduction in rates only after due notice.
DEPB for transport vehicles to Nepal in free foreign exchange.
DEPB rates for composite items to have lowest rate applicable for such constituent.
d) Export Promotion Capital Goods (EPCG)
EPCG licences of Rs.100 crore or more to have 12 year export obligation (EO) period with 5 year moratorium period.
EO fulfilment period extended from 8 years to 12 years in respect of units in agri-export zones and in respect of companies under the revival plan of BIFR.
Supplies under Deemed Exports to be eligible for export obligation fulfilment along with deemed export benefit.
Re-fixation of EO in respect of past cases of imports of second hand capital goods under EPCG Scheme.Salient features of the Exim policy 2002-07.
Back to Page 1 of Exim Policy 2002-07: Highlights
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