(MENAFN- Khaleej Times) India on Friday unveiled its new foreign trade policy (FTP) 2023, which seeks to boost the country's exports to $2 trillion by the year 2030 and focuses on international trade settlement in rupees.
International trade settlement in rupees is allowed under the new policy and changes introduced for the grant of export benefits and fulfilment of export obligation for export realisations in Indian currency as per RBI norms.
The government has been working towards making the Indian rupee a global currency and allowing international trade settlement.
The RBI had last year put in place an additional arrangement for invoicing, payment, and settlement of exports/imports in Indian currency. This mechanism will help in internationalising the Indian currency in the long run. A currency can be termed“international” if it is widely accepted worldwide as a medium of exchange.
Unlike the practice of announcing 5-year FTP, the latest policy has no end date and will be updated as and when needed, Director General of Foreign Trade (DGFT) Santosh Sarangi told the media.
Earlier, Commerce and Industry Minister Piyush Goyal unveiled FTP 2023 which will come into effect from April 1, 2023.
The DGFT also said India is likely to end this fiscal year with total exports of $760-770 billion as against $676 billion in 2021-22.
The last five-year policy came into force on April 1, 2015. However, it was extended several times in the wake of coronavirus outbreak and subsequent disruptions in economic activities globally. The last extension was given in September 2022 till March 31, 2023.
The new FTP identifies four new Towns of Export Excellence (TEE) - Faridabad, Moradabad, Mirzapur and Varanasi - in addition to the already existing 39 TEEs.
The FTP benefits have been extended to e-commerce exports, which are estimated to grow to $200-300 billion by 2030.
The value limit for exports through courier service is being increased from Rs500,000 to Rs1 million per consignment, he said.
The new FTP also seeks to make the Indian rupee a global currency and allow international trade settlement in the domestic currency.
The DGFT further said FTP 2023 is dynamic and responsive to the emerging trade scenario. He also said the department of commerce is being restructured to make it“future-ready”.
Commerce and Industry Piyush Goyal on Friday exuded confidence that India's merchandise and services exports will cross $2 trillion by 2030 from the current level of $765 billion, as he unveiled a“dynamic and responsive” foreign trade policy.
He said that goods exports have witnessed good growth considering the current global scenario while services exports may see a quantum jump in the current fiscal.
“We have to meet our exports targets going forward,” said the minister, adding that“we will need to work a bit harder” on goods exports.
“It shouldn't be that by 2030, services exports cross $1 trillion while you (merchandise exports) lag behind. I am confident that we will cross $2 trillion by 2030,” Goyal said.
The minister said he has asked the Department of Commerce to undertake a“massive focused concentrated” outreach globally in the next 4-5 months sectorally as well as country-wise through Indian missions abroad with special focus on trade, technology, tourism and investment.
India's total exports growth decelerated to 13.4 per cent in 2022-23 annually from 36 per cent expansion in the previous financial year as global demand was affected following outbreak of Russia-Ukraine war in February 2022 and other geopolitical reasons.
“We will achieve exports of $1 trillion each in goods and services by 2030,” Goyal said.
The Foreign Trade Policy 2023 outlines a host of measures and incentives to boost exports from India.
“We always had the capacity to do more, but I feel it needed Prime Minister Narendra Modi to pump up our energies and enthusiasm and see the change witnessed thereafter,” Goyal said.
The WTO's global trade has forecast growth in world trade to slow down to 1 per cent in 2023 due to global uncertainties.