Between 1950 and 1990, foreign trade of India suffered from strict bureaucratic and discretionary controls. Beginning 1991, the Government of India introduced a series of reforms to liberalise and globalise the Indian economy. Reforms in the foreign trade sector were intended to integrate Indian economy with the global economy. The major trade policy changes in the post-1991 period have included simplification of procedures, removal of quantitative restrictions, and substantial reduction in the tariff rates. Since early 1990s, India’s foreign trade has undergone a complete change in terms of composition and direction. Exports now cover a wide range of traditional and non-traditional items while imports mainly consist of capital goods, petroleum products, raw materials, and chemicals to meet the ever-increasing needs of a developing and diversifying economy. Exports have acquired added significance in the wake of liberalisation wave sweeping across the world. The trend towards market economy in almost all the countries of the world has increased the role of exports in developmental efforts. Exports have become an important indicator of a country’s economic performance. The surge in exports has provided a strong stimulus to domestic industrial growth. While software exports are a well-known success story, India is now an important venue for many tasks in services such as financial accounting, call centres, processing insurance claims, and medical transcription. The future potential for growth in these areas appears to be considerable. The process of opening up of the Indian economy has given birth to a host of new challenges and opportunities. The spirit of the liberalisation process entails a conscious effort on the part of policy makers to optimise on these opportunities-challenges trade-offs. CONTENTS 1. Pre-Independence Foreign Trade 1.1 India’s Foreign Trade in Ancient Times 1.2 Favourable Balance of Trade during 17th Century 1.3 The Period 1857-1900 1.4 First World War 1.5 Great Depression 1.6 Second World War 1.7 Post-War Period 2. Legal and Institutional Framework for Foreign Trade 2.1 Constitutional Provisions and the Law 2.2 Department of Commerce, Ministry of Commerce and Industry 2.3 Attached Offices of the Department of Commerce 2.4 Subordinate Offices of the Department of Commerce 2.5 Autonomous Bodies under Department of Commerce 2.6 Public Sector Undertakings 2.7 Advisory Bodies 2.8 Other Organisations 3. Post-Independence Trade Policy 3.1 Partition and the Aftermath 3.2 Depletion of Sterling Balances 3.3 Empire Dollar Pool 3.4 Devaluation of the Rupee in September 1949 3.5 Korean War and the Export Boom 3.6 Trade Agreement with Pakistan, 1950 3.7 Devaluation of the Rupee in June 1966 3.8 Import Substitution: Cornerstone of Trade Policy 3.9 Balance of Payments Crisis, 1991 3.10 East Asian Crisis 3.11 Gender Sensitization of Trade Policy 3.12 Initiation of Reforms in the Foreign Trade Sector 4. Export-Import (EXIM) Policy: 1992-97, 1997-2002 and 2002-07 4.1 EXIM Policy, 1992-97 4.2 EXIM Policy, 1997-2002 4.3 EXIM Policy, 2002-07 5. Foreign Trade Policy (FTP): 2004-09, 2009-14 and 2015-20 5.1 Foreign Trade Policy (FTP), 2004-09 5.2 Foreign Trade Policy (FTP), 2009-14 5.3 Foreign Trade Policy (FTP), 2015-20 6. Composition and Destination of Exports 6.1 Post-Independence Export Performance at a Glance 6.2 Composition of Exports 6.3 Destination of Exports 7. Product-wise Export Strategy 7.1 Project Exports 7.2 Information Technology (IT) Sector 7.3 Services Sector 7.4 Gems and Jewellery 7.5 Pharmaceutical Industry 7.6 Engineering Goods 7.7 Chemicals 7.8 Electronics Goods 7.9 Leather Products 7.10 Textiles 7.11 Carpets 7.12 Iron Ore 7.13 Agriculture Exports 8. Region-wise and Country-wise Export Strategy 8.1 Region-wise Export Strategy 8.2 Country-wise Export Strategy 9. Export Promotion Councils (EPCs) 9.1 Engineering Export Promotion Council (EEPC) 9.2 Project Exports Promotion Council of India (PEPC) 9.3 Chemicals and Allied Products Export Promotion Council (CAPEXIL) 9.4 Council for Leather Exports (CLE) 9.5 Sports Goods Export Promotion Council (SGEPC) 9.6 Gem and Jewellery Export Promotion Council (GJEPC) 9.7 Shellac and Forest Products Export Promotion Council (SHEFEXIL) 9.8 Cashew Export Promotion Council (CEPC) 9.9 Plastics Export Promotion Council (PLEXCONCIL) 9.10 Pharmaceuticals Export Promotion Council (Pharmexcil) 9.11 Services Export Promotion Council (SEPC) 10. Special Economic Zones (SEZs) 10.1 Special Economic Zones Act, 2005 10.2 Approval Mechanism and Administrative Set up of SEZs 10.3 Criteria for Approval 10.4 Conversion of EPZs into SEZs 10.5 Incentives and Facilities Offered to Units in SEZs 10.6 Incentives and Facilities Available to SEZ Developers 10.7 Apprehensions and Concerns 10.8 SEZs and National Security 10.9 Lessons from China 10.10 Issues Relating to SEZs 11. Exports and Goods and Services Tax (GST) 11.1 Goods and Services Tax (GST): Brief Introduction 11.2 Meaning of Export of Goods and Services 11.3 Exports are Inter-state Supplies 11.4 Exports are Zero-rated Supplies 11.5 Options for the Exporters 11.6 Grant of Provisional Refund in Case of Zero-rated Supplies 11.7 Refund Problems 11.8 Failure to Export Goods and Services 11.9 Export of Goods and Services to Nepal and Bhutan 11.10 Refund of IGST Paid on Supply of Goods to Tourist Leaving India 12. Export Promotion Strategy, Issues and Concerns 12.1 Credit Flow to Export Sector 12.2 Competitiveness of Exports 12.3 Medium Term Export Strategy (MTES) 12.4 Restraining Domestic Consumption 12.5 Product Diversification 12.6 Export Infrastructure 12.7 Export Promotion Schemes 12.8 Trade Facilitation 12.9 Adhering to Standards and Building India Brand 12.10 Digitisation and E-governance 12.11 Future of India’s Exports 13. Composition and Origin of Imports 13.1 Euphoria for Import Substitution 13.2 Reduction in Tariff and Non-tariff Barriers 13.3 Composition of Imports 13.4 Import Intensity of Exports in India 13.5 Origin of Imports 13.6 Agricultural Imports 14. Customs Duties 14.1 Legislative Framework 14.2 Customs Act, 1962 14.3 Customs Tariff Act, 1975 14.4 Various Types of Customs Duties 14.5 Exemptions from Customs Duty 15. Imports and Goods and Services Tax (GST) 15.1 Meaning of Imports of Goods and Services 15.2 Imports are Inter-state Supplies 15.3 Applicability of IGST 15.4 Rationale for IGST on Imports 15.5 Calculation of IGST 15.6 Other Notable Points 15.7 Exemptions from IGST on Certain Imports 16. Dumping of Chinese Goods in India 16.1 What is Dumping? 16.2 Dumping of Chinese Goods in India 16.3 Why Chinese Goods are More Competitive than Indian Goods? 16.4 Adverse Consequences of Chinese Goods 16.5 Anti-dumping and Other Trade Remedial Measures 16.6 Impact of Chinese Goods on Indian Industry 17. India and World Trade Organization (WTO) 17.1 Establishment of WTO 17.2 Trade Policy Reviews (TPRs) of India Bibliography Index