Keeping the situation of Covid-19 in mind, the Government may add much more new elements to the five-year foreign trade policy. So, there is no clarity whether the policy will be announced on April 1 or not.
Wide Impact of Covid-19 on The Policy
The Foreign Trade Policy of five years was thought to be in place in April 2020 but due to the Covid-19, the policy was postponed by one year. All the schemes of the older policy got extended by a year. An industry source said, “Now that there is a resurge of Covid-19 cases in India, the government may want to wait and watch how it affects global demand and exports and, if required, incorporate more measures in the FTP. Since we haven’t heard anything about the announcement of the FTP on April 1 yet, there is a possibility that there may be a delay”.
Will The Delay Hurt The Exporters?
Due to the delay of the foreign trade policy, the exporters are anxious in planning their long-term business decisions. The delay is also hampering the shipments. The Government is also aiming to raise the share of India in global exports from 2% to 3.5%.
TPT Policy Advocacy & Recommendations
- The new FTP must have a positive impact on the trade performance of India. To increase the Indian share in the global trade, FTP should promote exports of specific products and services in specific geographies.
- The new FTP must extend the export interest subvention for working capital to various other products. High transaction costs for the Indian exports must be addressed to be globally competitive.