MSMEs with touch of E-commerce can cause big ripples under new Foreign Trade Policy
The new FTP which is likely to be launched on April 1 presents an unprecedented opportunity to help exporters tackle the double whammy of Covid-19 and regulatory constraints.
The existing FTP, which was due to end in March 2020, was extended in the wake of the pandemic till 31 March 2021. It’s now time for a new FTP to be framed. The expectations of exporters and E-commerce retailers are high as to what will it contain? Will it be strong enough to deal with the unforeseen repercussions of a pandemic, lockdown, and an increasingly protectionist world?
The new Foreign Trade Policy is likely to focus on encouraging exports through ecommerce as also identifying districts as export hubs while re-looking at products that are restricted or banned for export and import.
Many SMEs have had to ramp up their digital activity in response to the challenges of Covid-19, learning as they go online.
According to Indian Brand Equity Foundation, Indian e-commerce market will reach US$ 99 billion by 2024, growing at a 27% CAGR over 2019-24, with grocery and fashion/apparel likely to be the key drivers of incremental growth.
Indian E-commerce industry has been on an upward growth trajectory and is catching up fast with the US to become the second largest E-commerce market in the world by 2034 for export.
In this time of crisis there is a pressing need to keep supply chains moving with robust logistic infrastructure as the world has encountered the sharpest decline in international commerce.
In order to encourage exporters the EPCG (Export Promotion Capital Goods) allows duty-free import of capital goods on condition that at least a part of it is used to produce goods for export.
