[Indian Year Book 2022-23]* Indian Year Book Notes | Chapter 10. Commerce

 

Indian Year Book

(2022-23)

Chapter – 10.  Commerce

 

Ø  THE Department of Commerce , comes under the Ministry of Commerce and Industry, Government of India. The mandate of the Department of Commerce is regulation and development of India’s international trade and commerce.

Ø  The Department formulates , implements and monitors the Foreign Trade Policy (FTP) which provides the basic framework of policy and strategy to be followed for promoting exports and trade.

 

Trade Performance

Ø  Despite the challenging global trade environment, India’s merchandise exports saw a consistent growth to reach a new peak of over USD 330 billion in FY 2019.

Ø  Export growth, in 2020 however got affected by the trade slowdown aggravated by Covid-19. India’s merchandise exports in Apr-June 2021 were USD 95.55 billion (highest ever merchandise exports in a quarter).

Ø  India also recorded highest ever FDI infl ow of USD 81.72 billion in 2020-21.

 

Merchandise Exports

§  According to WTO World Trade Statistical Review 2021, in 2020, India ranked 21st in the leading exporter of merchandise trade in the world with a share of 1.6 per cent. In FY 2020-21, India’s total merchandise exports were USD 291.81 billion.

§  Major product categories and their share in export basket in FY 2020-21 are:

§  Petroleum products (8.84 per cent),

§  Drug formulations, biologicals (6.53 per cent), Pearl, precious and semi-precious stones (6.22 per cent),

§  Iron and steel (4.15 per cent) and electric machinery and

§  Equipment (2.78 per cent).

§  Major Export destinations and their share are

§  USA (17.69 per cent),

§  China (7.26 per cent), UAE (5.72 per cent),

§  Hong Kong (3.48 per cent) and

§  Bangladesh (3.32 per cent).

 

Merchandise Imports

Ø  According to WTO World Trade Statistical Review 2021, in 2020, India ranked 14th in the leading importer of merchandise trade in the world with a share of 2.1 per cent.

Ø  Top 5 import categories in terms of share in India’s import basket in FY 2020-21 are: petroleum:

·         Crude Oil(15.08 per cent),

·         Gold (8.77 per cent),

·         Petroleum products (5.88 per cent),

·         Pearls, precious and semi-precious stones (4.79 per cent),

·         Coal, coke and briquettes, etc., (4.13 per cent).

Ø  The major import sources in 2020-21 were

·         China (16.53 per cent),

·         USA (7.32 per cent), UAE (6.75 per cent),

·         Switzerland (4.62 per cent) and

·         Saudi Arabia (4.10 per cent).

 

Services Trade

Ø  According to the WTO World Trade Statistical Review 2021, in 2020, India ranked 7th in leading exporters of commercial services and ranked 10th in leading importer of commercial services with a share of 3.3 per cent.

 

Trade Balance

Ø  Taking merchandise and services together, overall trade defi cit was USD 14.06 billion in FY 2020-21 as compared to USD 76.43 billion during the previous fi nancial year.

Ø  Overall trade defi cit for April-July 2021 was USD 9.74 billion as compared to trade surplus of USD 13.84 billion in April-July 2020.

 

Global Perspective

Ø  The Global merchandise trade recovery, after pandemic, is set to broaden after being initially concentrated in pandemic-related purchases, consumer durables, and medical equipment.

Ø  Services trade is expected to recover more slowly, consistent with subdued cross-border travel until virus transmission declines to low levels everywhere.

 

 Foreign Trade Policy

Ø  The Foreign Trade Policy (FTP), the basic framework of policy and strategy for promoting trade from India has conventionally been formulated for fi ve years at a time and reviewed periodically.

Ø  The FTP for 2015-20, announced in April 2015, provided a framework for increasing exports of goods and services as well as generation of employment and increasing value addition in the country, in keeping with the “Make in India” vision of the country.

 

Directorate General of Foreign Trade

Ø  Directorate General of Foreign Trade (DGFT) is an attached offi ce of the Ministry of Commerce and Industry and is headed by Director General of Foreign Trade.

Ø  This organisation has been essentially involved in the regulation and promotion of foreign trade through regulation.

Ø  Keeping in line with liberalisation and globalisation, and the overall objective of increasing of exports, DGFT has since been assigned the role of “facilitator”.

 

Web Portals

Ø  DGFT has launched an updated website which has a large dynamic component whereby the trade community can fi le applications online for IEC and various other schemes.

 

Capacity Building

Ø  Skilling new entrepreneurs for exports is an important priority. In the last few years, several entrepreneurs have been trained under the Niryat Bandhu programme implemented by DGFT, thus complementing the Startup India and Skill India initiatives.

 

 Major Schemes for Export Promotion

§  Export Promotion Capital Goods (EPCG) Scheme

Ø  EPCG Scheme, an ongoing scheme under FTP, intends to facilitate import of capital goods for producing quality goods and services and enhance India’s manufacturing.

 

Interest Equalisation Scheme

Ø  The Interest Equalisation Scheme was formulated to give the benefi t in the interest rates being charged by the banks to the exporters on their pre and post shipment rupee export credits.

 

 Advance Authorisation Schemes

Ø  Advance Authorisation Scheme allows duty free import of inputs, which are physically incorporated in an export product.

Ø  In addition to any inputs, packaging material, fuel, oil, catalyst which is consumed/utilised in the process of production of export product, is also to be allowed.

 

Special Economic Zone (SEZ) Scheme

Ø  There are 262 operational SEZs in India of which the success story of Kandla is of special mention in the backdrop of Covid-19.

 

Niryat Bandhu Scheme

Ø  Niryat Bandhu Scheme was started in 2013 and training programmes are being implemented in inperson and online mode to cater to the initial skilling needs of new individuals/fi rms who plan to enter international trade.

 

Government e-Marketplace (GeM) Scheme

Ø  The Government e-Marketplace (GeM) as an e-marketplace to revolutionize public procurement in India.

Ø  In less than 5 years since its inception, GeM has successfully transformed the public procurement space in the country through its technology-driven innovations and other strategic interventions.

Ø   GeM’s approach is underlined by a commitment to its three pillars: transparency, effi ciency (with the attendant cost-savings), and inclusiveness.

Ø  In line with its pursuit of a universal and vibrant buyer-seller ecosystem in the platform, GeM saw substantial improvements in the number of buyers and sellers on the platform.

 

Common Facility Centres (CFCs) Scheme

Ø  The Scheme for setting up Common Facility Centre (CFC) for gems and jewellery sector.

Ø  The Scheme is fully funded by the Central government (Department of Commerce) and is being implemented through Gem & Jewellery Export Promotion Council (GJEPC).

 

Plantation Sector

Ø  The Department, through the respective commodity boards (Tea, Coffee, Rubber and Spice Boards), implements developments and promotion schemes for the plantation industry in the plantation growing areas of the country.

 

Remission of Duties and Taxes on Exported Products

Ø  A new Scheme, Remission of Duties and Taxes on Exported Products, (RoDTEP) for re-imbursement of currently un-refunded central, state and local taxes and duties incurred in the process of manufacture and distribution of exported products has been functional from January 2021.

 

Trade Infrastructure for Export Scheme

Ø  Trade Infrastructure for Export Scheme (TIES) was implemented with the objective of assisting central and state government agencies for creation of appropriate infrastructure for growth of exports

 

Export Promotion Initiatives Developing District as Export Hub

Ø  There has been a demand to convert each district into an export hub.

Ø  This directed focus towards making districts as active stakeholders in promotion of exports of goods/ services produced/manufactured in the district. As part of this initiative, an institutional mechanism has been set up in each district in the form of District Export Promotion Committees (DEPCs).

 

Contact Centre Services & Helpdesk

Ø  Contact Centre and Helpdesk were launched for the trade to resolve exporters’ issues, grievances and suggestions.

 

 

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