- In an effort to remove the anti-export bias of extant policies, improve efficiency of resource allocation as well as competitiveness of domestic markets, India has made steady progress in eliminating quantitative restrictions, licensing and discretionary controls over imports since 1991. Imports of capital goods, raw materials and components have been delicensed, tariffs on such imports have been reduced substantially, and tariff categories have been reclassified with an eye on streamlining and simplification. As a result, all goods can now be freely imported and exported, except those belonging to two negative lists.
- With the objective of accelerating the pace of reforms, sustaining high export growth and enhancing the opportunities for the domestic economy's participation in the dynamics of foreign trade, the EXIM Policy 1992-97 has been reviewed and revised in several ways during the current year to further phase out quantitative and qualitative restrictions. The revisions include measures for trade promotion as well as further simplification of procedures.
- A number of items from the negative/restricted list have been permitted free for import and many others have been shifted to the list of items which can be imported under the special import license (SIL) scheme. For example, 40 items were removed from the negative list and made freely importable and 14 others shifted to SIL list on 21st August, 1996. Similarly, a notification was issued on 13th September, 1996, whereby two restricted items were made free for imports and 55 restricted items were permitted against SIL. By another notification issued on 10th February, 1997, as many as 69 items in the SIL list have been moved to the free list and another 95 items have been taken off the restricted list and placed on the SIL list.
- In an effort to promote trade with Latin America, a notification has listed forty-three South American countries, and made exports undertaken after April 1,1996 to these countries eligible for double weightage benefit for recognition as export house/trading house/star trading house/super star trading house.
- To give a fillip to indigenous manufacturers of capital goods and to help improve infrastructure facilities in the power sector, the supply of capital goods to power projects which are done under the procedure of competitive bidding have been made eligible for refund of terminal excise duty as also for special import licenses.
- Minerals and Metals Trading Corporation (MMTC) was the only canalising agency for import of urea until October 1, 1996. In an effort to bring about progressive decanalisation, the State Trading Corporation (STC) and Indian Potash Ltd. (IPL), apart from the MMTC, were also authorised to import urea from October 1, 1996.
- To encourage eradication of child labour in the carpet industry and for rehabilitation of carpet weavers, the export of hand-knitted carpets and floor coverings excluding cotton durries and floor coverings, was again subjected to production of Registration-cum-Membership certificate from the Carpet Export Promotion Council, New Delhi, from August 1, 1996.
- Given the domestic demand/supply imbalance in wheat in the current year, export of wheat products, which had been earlier allowed without any restriction, was subjected to a quantitative ceiling from October 1, 1996. For the period October, 1996 to March, 1997, a ceiling of 1.5 lakh tonnes has been announced for export of wheat products and placed at the disposal of APEDA for further disbursement.
- In accordance with the terms of the General Agreement on Tariffs and Trade, a country is required to lift quantitative restrictions on imports imposed for Balance of Payments reasons when the position improves. As the position of foreign exchange reserves is comfortable, India is bound to phase out quantitative restrictions in respect of all items.
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