DGFT extends Foreign Trade Policy & Export Promotion Schemes till March 31, 2021

The Directorate General of Foreign Trade (DGFT) has extended Foreign Trade Policy by a year till March 31, 2021 following several representations from various export promotion bodies in the country including Pharmexcil in the wake of 21-day lockdown announced by the government to contain the spread of coronavirus.

The existing foreign trade policy 2015-2020 which is valid upto March 31, 2020 is extended upto March 31, 2021, stated a notification issued by the DGFT.

Besides this, the validity of other import linked export schemes including Duty Free Import Authorisation (DFIA) and Export Promotion Capital Goods (EPCG) have also been extended for a year till March 31, 2021, stated the notification.

EPCG scheme enables an importer to import capital goods used in the production of goods meant for export at zero rates of customs duty while DFIA is issued to allow duty free import of inputs.

However, for all DFIAs (including transferable DFIAs), where the validity for import is expiring between February 1, 2020 and July 31, 2020, the validity stands automatically extended by six months from the date of expiry, said DGFT in the notification.

Regional authority shall issue transferable DFIA with a validity of 12 months from the date of issue.

However, the service categories eligible under the SEIS scheme and the rates of reward on such services as rendered with effect from April, 2019 to March 31, 2020 shall be notified separately. For the services rendered with effect from April 1, 2020, decision on continuation of the scheme will be taken subsequently and notified accordingly, said the DGFT.

The government also extended the exemptions to imports against Advance Authorisations for physical exports from Integrated Tax and Compensation Cess upto March 31, 2021. Imports under Advance Authorisation are exempted from payment of Basic Customs Duty, Additional Customs Duty, Education Cess, Anti-dumping Duty, Countervailing Duty, Safeguard Duty, Transition Product Specific Safeguard Duty, wherever applicable. Advance authorisation is issued to allow duty free import of inputs, which is physically incorporated in export product.

The same exemption has been given to imports from bonded warehouse in domestic tariff area or from international exhibition held in India.

Earlier, Pharmaceutical Export Promotion Council of India (Pharmexcil) in a representation to DGFT stated that fulfillment of export obligation is likely to get impacted for all licenses such as advance authorisation, EPCG, DFIA having expiry dates from March to June 2020 as India’s supply chain operations are severely hampered due to lockdown. It urged DGFT to release a notification for 6 months extension for all such licenses which have expiry during these dates.

It also appealed to DGFT to extend validity of all valid Merchandise Exports from India Scheme (MEIS) scrips by 6 months from its original expiry dates. Imports into India are likely to get impacted due to lockdown thereby leading to huge un-utilised scrips as these are transferable, said Pharmexcil.

Exporters have welcomed the DGFT’s decision to extend foreign trade policy and a slew of export promotion schemes for a year.

Said Nipun Jain, chairman, SME Panel, Pharmexcil, “We welcome the government’s decision to extend foreign trade policy as well as schemes such as Advance Authorisations upto March 31, 2021. Advance Authorisation facility has been of a great incentive for exporters as they do not require to block huge amounts of money in advance towards payment of various import duties.”

Source: http://www.pharmabiz.com/NewsDetails.aspx?aid=122188&sid=1