The Foreign Trade Policy (FTP) is a five-year framework issued by the Department of Commerce and Industry under the Foreign Trade (Development and Regulation) Act, 1992. It outlines incentives, schemes, and procedural guidelines to boost India’s exports and imports in a regulated and competitive environment.
The FTP 2015–20, effective from 1 April 2015, was originally set to end on 31 March 2020. However, in the wake of the unprecedented disruptions caused by the COVID-19 pandemic, the Ministry of Commerce and Industry extended the policy by one more year — until 31 March 2021. This decision, announced through Notification No. 57/2015–2020 and Public Notice No. 67, also extended the Handbook of Procedures (HBP) 2015–20 and introduced several procedural relaxations to ease compliance burdens for exporters.
This blog explores the background of the extension, the scheme-wise applicability, key procedural changes, and the broader implications for exporters navigating a challenging global trade environment.
1. Background
The FTP serves as the cornerstone of India’s trade facilitation strategy, providing predictability for exporters and importers over a fixed term. Each policy typically runs for five years, enabling businesses to plan investments, manage supply chains, and secure contracts with confidence.
The FTP 2015–20, which took effect on 1 April 2015, was due to expire on 31 March 2020. As the COVID-19 crisis unfolded, global supply chains were severely disrupted, and exporters faced delayed shipments, reduced demand, and logistical challenges. Recognising the need for continuity, the Government of India extended the policy until 31 March 2021.
The Directorate General of Foreign Trade (DGFT) issued Notification No. 57/2015–2020 on 31 March 2020 to formalise the extension. Simultaneously, Public Notice No. 67 extended the validity of the Handbook of Procedures, which contains detailed operational guidelines for various schemes under the FTP.
2. Applicability of Extension under Various Schemes
The extension covered a range of schemes, although some received full continuity while others awaited further announcements.
1) Merchandise Exports from India Scheme (MEIS)
Extended for exports with Let Export Order (LEO) dates up to 31 March 2021. The earlier proposal to replace MEIS with the Remission of Duties and Taxes on Exported Products (RoDTEP) scheme may be deferred, though no formal notification had been issued at the time.
2) Service Exports from India Scheme (SEIS)
Not extended in its existing form. Eligible services and entitlement rates for FY 2019–20 were to be notified separately in Appendix 3X. The previous Appendix 3D would no longer apply for FY 2019–20. A decision on the scheme’s continuation in FY 2020–21 was pending.
3) Advance Authorisation
Extended until 31 March 2021, including the exemption from IGST and compensation cess on imports under the scheme.
4) Duty Free Import Authorisation (DFIA)
Extended, with automatic six-month validity extensions for imports expiring between 1 February 2020 and 31 July 2020.
5) Rebate of State and Central Taxes and Levies (RoSCTL) for Apparel Exports
Extended for exports with LEO dates up to 31 March 2021.
6) Export Promotion Capital Goods (EPCG) Scheme
Extended with IGST and compensation cess exemptions until 31 March 2021. EPCG imports expiring between 1 February 2020 and 31 July 2020 received an automatic six-month extension.
7) Export Oriented Units (EOUs), EHTPs, STPs, and BTPs
Extended, including IGST and compensation cess exemptions for imports and procurement from bonded warehouses in Domestic Tariff Areas (DTAs) or from international exhibitions in India.
8) Transport and Marketing Assistance (TMA) for Agricultural Products
Extended for exports with LEO dates up to 31 March 2021.
9) Benefits to Deemed Exports
Extended for deemed exports completed by 31 March 2021.
3. Changes to Procedures
Alongside the policy extension, DGFT extended the validity of the Handbook of Procedures to 31 March 2021 and amended multiple procedural timelines to address exporter challenges caused by COVID-19.
Chapter 3 (MEIS, SEIS, Status Holder)
- MEIS applications for LEO dates between 1 February 2019 and 31 May 2019 could be filed within 15 months without late cuts (previously 12 months).
- SEIS applications for FY 2018–19 without late cuts could be filed until 31 December 2020 (extended from 31 March 2020).
- Status Holder certificates remained valid for the later of five years from the application date or 31 March 2021.
Chapter 4 (Advance Authorisation, DFIA, RoSCTL)
- Norms Committee ratifications extended to the later of three years from ratification or 31 March 2021.
- Import validity and revalidation for Advance Authorisations expiring between 1 February 2020 and 31 July 2020 extended from 12 to 18 months.
- Export Obligation Periods (EOPs) for authorisations expiring in the same window extended from 18 to 24 months.
- Multiple timelines in the Gems & Jewellery sector extended by six months.
- RoSCTL benefit applications for shipping bills with LEO dates until 31 December could be filed by 31 December 2020.
Chapter 5 (EPCG)
- Six-month extensions granted for installation certificate submissions and EOP fulfilment deadlines expiring between 1 February 2020 and 31 July 2020.
Chapter 6 (EOUs, STPs, EHTPs, BTPs)
- Letters of permission or approval valid until at least 31 December 2020.
- EOP fulfilment deadlines for certain agricultural and plantation product imports extended to 30 September 2020.
- Reporting deadlines for Annual, Quarterly, and Monthly Performance Reports extended.
Chapter 7 (Deemed Exports, TMA)
- TMA applications for quarters ending 31 March 2019 and 30 June 2019 extended to 30 September 2020.
- Drawback/TED claims with deadlines after 1 March 2020 extended to 30 September 2020.
Others
- Renewal of RCMCs not required until 30 September 2020.
- SIMS registration validity extended to 135 days for ARNs generated until 31 March 2020.
4. M2K Comments
Extending the FTP by one year provided exporters with stability in a highly uncertain trade environment. In the wake of a WTO ruling affecting some incentive schemes, continuity helped exporters maintain competitiveness and negotiate contracts with more confidence.
Equally important were the procedural relaxations, which gave exporters breathing space to meet obligations despite supply chain disruptions. By extending key timelines for applications, authorisations, and reporting, the DGFT reduced the risk of exporters losing benefits or facing penalties due to delays caused by the pandemic.
The extension reflects the government’s recognition of the unprecedented challenges faced by businesses and underscores the need for policy flexibility in extraordinary times.
