India’s Foreign Trade Policy is a set of guidelines and strategies formulated by the Government of India to regulate and promote the country’s exports and imports. The FTP aims to:
Enhance export performance.
Develop India’s competitiveness in international markets.
Promote trade-led economic growth.
The policy is typically reviewed every five years, but adjustments can be made as needed to respond to global and domestic challenges.
Key Objectives of the Latest Foreign Trade Policy (2023-28)
The latest Foreign Trade Policy 2023-28, launched by the Ministry of Commerce and Industry, focuses on the following:
Achieving Export Targets: Aiming to reach $2 trillion in exports (goods and services) by 2030.
Boosting Ease of Doing Business: Simplifying procedures for exporters and reducing compliance burdens.
Promoting Digitalization: Encouraging paperless trade and e-commerce.
Regional Focus: Strengthening trade ties with Africa, Latin America and the Gulf regions.
Sustainability: Emphasizing environmentally friendly practices in trade.
Salient Features of FTP 2023-28
1. Emphasis on Districts as Export Hubs
Identifying and developing districts with high export potential.
Promoting One District, One Product (ODOP) initiatives.
2. E-Commerce Export Promotion
Recognizing the growing role of e-commerce in global trade.
Setting up dedicated e-commerce export hubs and simplifying regulations for small exporters.
3. Paperless Trade
Transitioning to a fully digital platform for trade documentation.
Introduction of online approvals and self-certification processes.
4. Special Focus on Services Export
Promoting sectors like IT, healthcare, and education for international markets.
Extending incentives under the Service Exports from India Scheme (SEIS).
5. Trade Agreements and FTA Utilization
Enhancing the use of Free Trade Agreements (FTAs) to reduce tariffs.
Focusing on new FTAs with the UK, Canada, and the EU.
6. Promoting Green Trade
Incentives for exports of renewable energy products and technologies.
Encouraging sustainable practices in manufacturing and trade.
Schemes Under FTP 2023-28
| Scheme Name | Objective | Key Features |
|---|---|---|
| RoDTEP (Remission of Duties and Taxes on Exported Products) | Refund embedded taxes and duties in export production. | Covers all sectors for competitive exports. |
| Advance Authorization Scheme | Duty-free import of raw materials for export production. | Reduces input costs for exporters. |
| EPCG (Export Promotion Capital Goods) | Duty-free import of capital goods for production. | Encourages modernization of export units. |
| TIES (Trade Infrastructure for Export Scheme) | Develop export infrastructure like warehouses and cold storage. | Focus on improving logistics efficiency. |
Challenges Addressed by FTP 2023-28
Global Trade Slowdown: Measures to counter declining global demand.
Geopolitical Uncertainty: Adapting to changing trade dynamics post-COVID-19 and geopolitical tensions.
Logistical Bottlenecks: Investment in better infrastructure and streamlining processes.
MSME Inclusion: Support for Micro, Small, and Medium Enterprises (MSMEs) to integrate into global value chains.
The Shift from Incentive-Based to Remission-Based Policies
India has moved from incentive-driven policies to remission-based frameworks to comply with WTO norms. This includes schemes like RoDTEP, ensuring that exporters are refunded duties and taxes embedded in their production processes.
Visual Representation of Export Targets (2023-30)
| Year | Goods Exports Target | Services Exports Target | Total Exports Target |
| 2023-24 | $500 billion | $350 billion | $850 billion |
| 2027-28 | $700 billion | $500 billion | $1.2 trillion |
| 2029-30 | $1 trillion | $1 trillion | $2 trillion |
Why Is FTP 2023-28 Significant?
Economic Growth: Exports contribute significantly to GDP growth.
Job Creation: Increased trade activities generate employment opportunities across sectors.
Global Competitiveness: Encourages Indian businesses to adopt global standards and practices.
Resilience: Diversification of export markets reduces dependence on specific regions.