Trade
3. Goods and Services Tax (GST):
- Objective: to enable more seamless national trade and establish a single tax system.
- Key Provisions:
- Integrated GST (IGST): imposed on the transfer of goods and services between states, including imports.
- Input Tax Credit: enables companies to get a credit for the GST they have paid on inputs that go into making products and services.
4. Trade Agreements:
- Bilateral and Multilateral Agreements: India participates in a number of trade agreements with the goal of lowering trade barriers and fostering economic cooperation, including the South Asian Free Trade Area (SAFTA), the ASEAN-India Free Trade Area, and others.
- Regional Comprehensive Economic Partnership (RCEP): India chose not to participate in the RCEP, but it is still in talks to be included in future iterations of the deal or other comparable ones.
5. Special Economic Zones (SEZs) Act, 2005:
- Objective: to encourage exports and draw in foreign investment by providing tax breaks and streamlined regulations.
- Key Provisions:
- Tax Benefits: SEZs provide tax breaks and other financial advantages to businesses who operate there.
- Single Window Clearance: streamlines the process of establishing and running a business in a Special Economic Zone.
6. Special Economic Zones (SEZs) Act, 2005:
- Objective: to make it easier for capital goods to be imported in order to produce superior export items.
- Key Provisions:
- Duty Exemption: permits the import of capital goods with no customs charges as long as export requirements are met.
7. Merchandise Exports from India Scheme (MEIS):
- Objective: To incentivize exports of specified goods.
- Key Provisions:
- Duty Credit Scrips: Duty credit scrips are given to exporters; they can be sold on the market or used to settle other duties.
Conclusion
India's trade policy framework is designed to promote international trade, protect domestic industries, and facilitate ease of doing business. By leveraging various acts and initiatives, India aims to create a robust trade environment that supports economic growth and development.
