Foreign Trade - #SectorUpdates
To enable traders to claim export benefits for international transactions settled in the rupee the Government has amended the foreign trade policy (FTP) to allow for the settlement of invoicing, payment, and settlement of exports/imports in Indian rupees. The export incentives were available only when the trade was settled in a foreign currency. The amendments will be applicable for goods imported for export, the realization of export proceeds under Advance Authorisation (AA), Duty-Free Import Authorisation (DFIA) schemes, and the realization of export proceeds under the Export Promotion Capital Goods (EPCG) scheme. The development comes against the backdrop of the mechanism to settle international trade transactions in the rupee which was unveiled by the Reserve Bank of India (RBI) in July. The amendment is expected to help increase India’s exports to countries facing acute foreign exchange shortages or those covered by sanctions and also facilitate the Government’s efforts toward the internationalization of the rupee.