INDIA’s FOREIGN TRADE POLICY, 2023
Context:
Ministry of Commerce and Industry launched the Foreign Trade Policy 2023, which came into effect from April 1, 2023.
FTP 2023 sets a $2 trillion target for exports of goods and services by 2030 with a shift from incentives to remission and entitlement-based regime.
What is an FTP?
A trade policy is a government policy that affects the number of goods and services a country exports and imports.
Significance of FTP:
|
Significance |
|
|
Export Promotion |
Increases revenue through exports and stimulates economic growth |
|
Encourages exports and attracts foreign investment |
|
|
Collaboration with States and Districts |
Facilitates export promotion at the regional level |
|
Economic growth |
Reduces transaction costs and simplifies export processes |
|
It facilitates the flow of the economy in a country and increases foreign exchange in a country. |
|
|
For domestic consumer |
It aids in facilitating free trade and liberalization and improving the overall market for domestic consumers of a country. |
Aim of FTP 2023:
- To enhance the competitiveness of Indian exports in the global market (India’s overall exports are about to reach US $760 billion this year)
- Promote sustainable development of the country’s trade sector
- Make India a leader in specific sectors such as pharmaceuticals, engineering goods, and textiles
- To promote a digital economy and leverage technology to enhance the competitiveness of Indian exports.
The Key Approach to the policy is based on these 4 pillars:
- An incentive to Remission (Reduction/cancellation of a debt, duty, or penalty)
- Export promotion through collaboration – Exporters, States, Districts, Indian Missions
- Ease of doing business, reduction in transaction cost and e-initiatives and
- Emerging Areas – E-Commerce Developing Districts as Export Hubs and streamlining SCOMET policy.
