Directorate General of Foreign Trade
       CHAPTER- 1 B

Special Focus




  With a view to continously increasing our percentagehttp share of global trade and expanding employmenthttp opportunities, certain special focus initiatives havehttp been identified/continued for Market Diversification,http Technological Upgradation, Support to status holders,http Agriculture, Handlooms, Handicraft, Gems & Jewellery,http Leather, Marine, Electronics and IT Hardwarehttp manufacturing Industries, Green products, Exportshttp of products from North-East, Sports Goods and Toyshttp sectors. Government of India shall make concertedhttp efforts to promote exports in these sectors by specifichttp sectoral strategies that shall be notified from time to time.
      Further Sectoral Initiatives in other sectors will also behttp announced from time to time.

(i) Market Diversification

Weaker demand in developed economies,http triggered by falling asset prices and increased economichttp uncertainty has pulled down the growth of India’s exportshttp to developed countries. There are no clear signals ashttp to when the markets in developed countries wouldhttp revive. To insulate Indian exports from the decline inhttp demand from developed countries, in this Policy focushttp is on diversification of Indian exports to other markets,http specially those located in Latin America, Africa, parts ofhttp Asia and Ocenia. To achieve diversification of Indianhttp exports, following initiatives have been taken under thishttp Policy.

      (a) 26 new countries have been included within thehttp ambit of Focus Market Scheme.
      (b) The incentives provided under Focus Market Schemehttp have been increased from 2.5 % to3 %.
      (c) There has been a significant increase in the outlayhttp under ‘Market Linked Focus Product Scheme’http by inclusion of more markets and products. Thishttp ensures support for exports to all countries in Africa and Latin America.

(ii) Technological Upgradation

To usher in the next phase of export growth, Indiahttp needs to move up in the value chain of export goods.http This objective is sought to be achieved by encouraginghttp technological upgradation of our export sector. A numberhttp of initiatives have been taken in this Policy to focus onhttp technological upgradation; such initiatives include:

      (a) EPCG Scheme at zero duty has been introduced forhttp certain engineering products, electronic products,http basic chemicals and pharmaceuticals, apparel andhttp textiles, plastics, handicrafts, chemicals and alliedhttp products and leather and leather products.
      (b) The existing 3% EPCG Scheme has been considerablyhttp simplified, to ease its usage by the exporters.
      (c) To encourage value added manufacture export, ahttp minimum 15% value addition on imported inputshttp under Advance Authorization Scheme has beenhttp stipulated.
      (d) A number of products including automobiles andhttp other engineering products have been included forhttp incentives under Focus Product, and Market Linkedhttp Focus Product Schemes.
      (e) Steps to encourage Project Exports shall be taken.

(iii) Support to status holders

The Government recognized ‘Status Holders’http contribute approx. 60% of India’s goods exports. Tohttp incentivise and encourage the status holders, as wellhttp as to encourage Technological upgradation of exporthttp production, additional duty credit scrip @ 1% ofhttp the FOB of past export shall be granted for specifiedhttp product groups including leather, specific sub sectors inhttp engineering, textiles, plastics, handicrafts and jute. Thishttp duty credit scrip can be used for import of capital goodshttp by these status holders. The imported capital goods shallhttp be subject to actual user condition.


(iv) Agriculture and Village Industry

(a) Vishesh Krishi and Gram Udyog Yojana

      (b) Capital goods imported under EPCG will be permittedhttp  to be installed anywhere in AEZ.
      (c) Import of restricted items, such as panels, are allowedhttp  under various export promotion schemes.
      (d) Import of inputs such as pesticides are permittedhttp under Advance Authorisation for agro exports.
      (e) New towns of export excellence with a thresholdhttp  limit of Rs 150 crore shall be notified.

(v) Handlooms

(a) Specific funds are earmarked under MAI / MDAhttp Scheme for promoting handloom exports.

      (b) Duty free import entitlement of specified trimmingshttp     and embellishments is 5% of FOB value of exportshttp     during previous financial year.
      c) Duty free import entitlement of hand knotted carpethttp samples is 1 % of FOB value of exports duringhttp previous financial year.
      (d) Duty free import of old pieces of hand knottedhttp  carpets on consignment basis for re-export afterhttp  repair is permitted.http  
       (e) New towns of export excellence with a thresholdhttp limit of Rs 150 crore shall be notified.http  
      (f) Machinery and equipment for effluent treatmenthttp  plants is exempt from customs duty.

(vi) Handicrafts

(a) Duty free import entitlement of tools, trimmingshttp     and embellishments is 5%of FOB value of exportshttp during previous financial year. Entitlement is broadhttp banded, and shall extend also to merchant exportershttp tied up with supporting manufacturers.

      (b) Handicraft EPC is authorized to import trimmings,http  mbellishments and consumables on behalf of thosehttp  exporters for whom directly importing may not behttp  viable.
      (c) Specific funds are earmarked under MAI & MDAhttp Schemes for promoting Handicraft exports.http  
      (d) CVD is exempted on duty free import of trimmings,http embellishments and consumables.
      (e) New towns of export excellence with a reducedhttp  threshold limit of Rs 150 crore shall be notified.
      (f) Machinery and equipment for effluent treatmenthttp plants are exempt from customs duty.
      (g) All handicraft exports would be treated as specialhttp Focus products and entitled to higher incentives.

(vii) Gems & Jewellery

(a) Import of gold of  8k and above is allowed underhttp  replenishment scheme subject to import beinghttp accompanied by an Assay Certificate specifyinghttp purity, weight and alloy content.

      (b) Duty Free Import Entitlement (based on FOBhttp value of exports during previous financial year) ofhttp  Consumables and Tools, for:
      1. Jewellery made out of:http (a) Precious metals (other than Gold &http       Platinum)– 2%http (b) Gold and Platinum – 1%http (c ) Rhodium finished Silver – 3%
      2. Cut and Polished Diamonds – %
      (c) Duty free import entitlement of commercial sampleshttp shall be Rs. 300,000.

(d) Duty free re-import entitlement for rejected jewelleryhttp shall be2 % of FOB value of exports.

(e) Import of Diamonds on consignment basis forhttp Certification/ Grading & re-export by the authorizedhttp     offices/agencies of Gemological Institute of Americahttp    (GIA) in India or other approved agencies will behttp     permitted.

(f) Personal carriage of Gems & Jewellery products inhttp case of holding/participating in overseas exhibitionshttp    increased to US$5 million and to US$1 million inhttp case of export promotion tours.

 (g) Extension in number of days for re-import of unsoldhttp  items in case of participation in an exhibition in USAhttp  increased to 90 days.

(h) In an endeavour to make India a diamondhttp     international trading hub, it is planned to establishhttp    “Diamond Bourse (s)”.


(viii) Leather and Footwear

(a) Duty free import entitlement of specified items ishttp  3% of FOB value of exports of leather garmentshttp during preceding financial year.

(b) Duty free entitlement for import of trimmings,http embellishments and footwear components forhttp footwear (leather as well as synthetic), gloves, travelhttp bags and handbags is3 % of FOB value of exports ofhttp previous financial year. Such entitlement shall alsohttp cover packing material, such as printed and non printedhttp shoeboxes, small cartons made of wood, tinhttp or plastic materials for packing footwear.

(c) Machinery and equipment for Effluent Treatmenthttp Plants shall be exempt from basic customs duty.

(d) Re-export of unsuitable imported materials such as raw hides & skins and wet blue leathers is permitted.

(e) CVD is exempted on lining and interlining materialhttp notified at S.No 168 of Customs Notification No http 21/2002 dated 01 .03 . 2002 .

(f) CVD is exempted on raw, tanned and dressed furhttp skins falling under Chapter 43 of ITC (HS).

(g) Re-export of unsold hides, skins and semi finishedhttp leather shall be allowed from Public Bondedhttp warehouse at 50% of the applicable export duty.


(ix) Marine Sector

(a) Imports for technological upgradation under EPCGhttp in fisheries sector (except fishing trawlers, ships,http boats and other similar items) exempted fromhttp maintaining average export obligation.

(b) Duty free import of specified specialised inputs /http chemicals and flavouring oils is allowed to the extenthttp of 1% of FOB value of preceding financial year’shttp export.

(c) To allow import of monofilament longline systemhttp for tuna fishing at a concessional rate of duty andhttp Bait Fish for tuna fishing at Nil duty.

(d) A self removal procedure for clearance of seafoodhttp waste is applicable subject to prescribed wastagehttp norms.

(e) Marine products are considered for VKGUYhttp scheme.


(x) Electronics and IT Hardware Manufacturing Industries

(a) Expeditious clearance of approvals required fromhttp DGFT shall be ensured.

(b) Exporters /Associations would be entitled to utilizehttp MAI & MDA Schemes for promoting Electronicshttp and IT Hardware Manufacturing industry exports.



(xi) Sports Goods and Toys

(a) Duty free import of specified specialised inputshttp allowed to the extent of 3% of FOB value ofhttp preceding financial year’s export.

(b) Sports goods and toys shall be treated as a Priorityhttp sector under MDA / MAI Scheme. Specific fundshttp would be earmarked under MAI /MDA Scheme forhttp promoting exports from this sector.

(c) Applications relating to Sports Goods and Toys shallhttp be considered for fast track clearance by DGFT.

(d) Sports Goods and Toys are treated as special focushttp products and entitled to higher incentives.


(xii) Green products and technologies

India aims to become a hub for production and exporthttp of green products and technologies. To achieve thishttp objective, special initiative will be taken to promotehttp development and manufacture of such products andhttp technologies for exports. To begin with, focus wouldhttp be on items relating to transportation, solar andhttp wind power generation and other products as mayhttp be notified which will be incentivized under Rewardhttp Schemes of Chapter 3 of FTP.


(xiii) Incentives for Exports from the North Eastern Region

In order to give a fillip to exports of products from thehttp north-eastern States, notified products of this regionhttp would be incentivized under Reward Schemes ofhttp Chapter 3 of FTP.