Text Size:
Thank you dear subscribers, we are overwhelmed with your response.
Your Turn is a unique section from ThePrint featuring points of view from its subscribers. If you are a subscriber, have a point of view, please send it to us. If not, do subscribe here: https://theprint.in/subscribe/
In the week gone by, Minister for Commerce and Industry Piyush Goyal released India’s new Foreign Trade Policy (FTP) 2023 that came into effect from the 01st of April 2023. After almost extending the FTP 2015-20 for three years, the new policy has been announced. In his government’s first FTP launched in 2015, Prime Minister Modi had set an ambitious target of annual exports to $900 billion by 2020. While that goal has not fully been achieved yet, India is much closer to it. As the minister noted during the release of the new policy Indian annual exports have already crossed US$ 750 Billion for this year.
The new FTP continues to focus on Trade Facilitation (TF) that is usually overlooked in the popular debate. The chapter on Trade Facilitation lays out in much detail measures already taken and newly proposed since the last FTP. These include at the heart of it the integration of digital initiatives like the National Single Window (System), the wide adoption of Electronic Data Interchange systems to streamline the process for all stakeholders etc. This is in continuation with the National Trade Facilitation Action Plan (NTFAP 2020-23) and mentions the works on the next plan for 2023-26. In 2016 India became a signatory to World Trade Organization’s Trade Facilitation Agreement (TFA) under which India agreed to the provisions like creating a NTFAP that is a detailed plan for initiatives and activities to improve TF measures. The FTP 2015-20 on the other hand included a section on TF but did not lay out in as detail terms India’s plan and measures for TF, as India only became a signatory to the TFA in 2016.
South Asia as a trading zone is the world’s least integrated zone, India since the last decade has also outlined other initiatives in this direction. One such example is the creation of bodies like the Land Ports Authority of India that have been created to facilitate trade via land with India’s neighbors and the larger neighborhood policy. These in that context signify a shift in the focus of easing the ability to trade and in turn reduce trade time and costs for traders in the long term are other important aspects of trade policy. Other parts of the policy also included announcements on new schemes like the Duty Remission Schemes, continuation of Duty Exemption Schemes, digitization, creation of a District Export Action Plan (DEAP) to enable greater promotion of districts and states in the policy making process to create Export hubs. At the same time old schemes and initiatives from previous policies also continue like the Export Promotion Capital Goods (EPCG) scheme. The policy also identifies key focus areas for the future of Indian exports such as that of the digital economy that has an entire chapter devoted to it that lays out a framework for the E-Commerce Exports of goods and services.
For the longest time India’s model of economic growth has been one based on domestic consumption. The role of international trade since independence in India’s growth story has been low. India’s share of global merchandise trade has stood at less than 2% globally. Fundamentally important to change this figure is to improve India’s export competitiveness. In that regard the new FTP in principle aims to highlight the government’s vision to creating more market friendly policies for companies by focusing on things like streamlining processes, creating digital infrastructure to support a transparent and paperless regulatory environment etc. that eases the ability to trade. Beyond the FTP other initiatives like the PM Gatishakti and Sagarmala also focus on the infrastructure and connectivity aspects of reducing time, costs for the movement of goods as well as people. While not mentioned in FTP explicitly, these measures also play a crucial role in India’s export competitiveness. As India continues to negotiate multiple trade agreements with various partners across the world, the simplification and promotion of a transparent and stable policy will only be beneficial for the growth of Indian trade.
A greater share of India in international trade will not only be beneficial in terms of growth of economy, but it will also enable the larger foreign policy goals of India and its ambitions. Without economic growth and prosperity, the role that India seeks to play in the globe is only going to be constrained, as for any great power the economic power and influence that it holds is central to its position in the world.
About the Author:
My name is Hritik Bhasin, and I am a final year MA Diplomacy, Law, and Business student at the Jindal School of International Affairs(JSIA) at O.P. Jindal Global University.
These pieces are being published as they have been received – they have not been edited/fact-checked by ThePrint.
Source: The Print
