22-Jul-2022: 206 Crore released to States for promotion of exports under TIES scheme

The Department of Commerce, Government of India is implementing the Trade Infrastructure for Export Scheme (TIES) w.e.f. FY 2017-18 with the objective of assisting Central and State Government agencies in the creation of appropriate infrastructure for growth of exports. Under the scheme, financial assistance in the form of grant-in-aid is provided to Central/State Government owned agencies (or their Joint Ventures with major stake-holding by them) for setting up or up-grading export infrastructure in States/UTs. The scheme can be availed by States through their implementing agencies, for infrastructure projects with significant export linkages like Border Haats, Land customs stations, quality testing and certification labs, cold chains, trade promotion centres, export warehousing and packaging, SEZs and ports/airports cargo terminuses. The Scheme guidelines are available at https://commerce.gov.in/trade-promotion/trade-promotion-assistance/.

Under the TIES, financial assistance for 27 export infrastructure projects have been approved during FY 2019-20 to 2022-23 (till 19th July, 2022).

17-Jul-2019: Export Promotion Scheme

The Government of India has launched a scheme namely, Trade Infrastructure for Export Scheme (TIES) from FY 2017-18 with the objective to assist Central and State Government Agencies for creation of appropriate infrastructure for growth of exports from the States. The Scheme provides financial assistance in the form of grant-in-aid to Central/State Government owned agencies for setting up or for up-gradation of export infrastructure as per the guidelines of the Scheme. The scheme can be availed by the States through their Implementing Agencies, for infrastructure projects with overwhelming export linkages like the Border Haats, Land customs stations, quality testing and certification labs, cold chains, trade promotion centres, dry ports, export warehousing and packaging, SEZs and ports/airports cargo terminuses.

Under the TIES Scheme, a total of 28 export infrastructure projects have been provided financial assistance during FY 2017-18, 2018-19 and 2019-20 (as on 1st July, 2019).

The Government of India strives to ensure a continuous dialogue with the State Governments and Union Territories on measures for promoting exports and for providing an international trade enabling environment in the States, and to create a framework for making the States active partners in boosting exports from India.

Under the Foreign Trade Policy (FTP), DGFT operates various Export promotion schemes such as Advance Authorization, Duty Free Import Authorization, Export Promotion of Capital Goods, Merchandise Exports from India Scheme (MEIS) and Services Exports from India Scheme (SEIS). To give effect to these schemes, Central Board of Indirect Taxes and Customs has issued various exemption notifications. The details of various exemptions provided for these schemes are given in the FTP.

MEIS was introduced in the FTP from 01.04.2015, providing rewards for exporters of specified goods. The objective of the MEIS is to offset infrastructural inefficiencies and associated costs involved in exporting goods/products which are produced/manufactured in India. The scheme incentivizes exporters in terms of Duty Credit Scrips at the rate of 2, 3, 4, 5, 7 % of FOB Value of exports realized. These scrips are transferable and can be used to pay certain Central Duties/taxes including Customs Duties.

As regards promotion of trade in services, Government of India provides fiscal benefits through Services Exports from India Scheme (SEIS) for some identified sectors. Government of India is following a multi-pronged strategy, including negotiating meaningful market access through multilateral, regional and bilateral trade agreements, trade promotion through participation in international fairs/exhibitions and focused strategies for specific markets and sectors to promote Trade in Services. An ‘Action Plan for Champion Sectors in Services’ has also been approved in February, 2018 to give focused attention to 12 Champion Services Sector like Information Technology / Information Technology Enabled Services, Tourism and Hospitality Services and Medical value Travel.

The Agriculture Export Policy was launched in 2018 to harness export potential of Indian agriculture, through suitable policy instruments, to make India global power in agriculture and raise farmers’ income. This comprehensive “Agriculture Export Policy” aims to increase agricultural exports by integrating Indian farmers and agricultural products with the global value chains.

Section 10AA of the Income-tax Act, 1961 provides for deduction of profits and gains derived from the export of articles or things or from services in respect of newly established Units in Special Economic Zones. Such deduction is allowed to an  entrepreneur as referred to in clause (j) of section 2 of the Special Economic Zones Act, 2005, from his Unit, who begins to manufacture or produce articles or things or provide any services during the previous year relevant to any assessment year commencing on or after the 1st day of April, 2006, but before the first day of April, 2021.  The deduction is allowed as under:

• Hundred per cent of profits and gains derived from the export, of such articles or things or from services for a period of five consecutive assessment years beginning with the assessment year relevant to the previous year in which the Unit begins to manufacture or produce such articles or things or provide services, as the case may be, and fifty per cent of such profits and gains for further five assessment years and thereafter.
• For the next five consecutive assessment years, so much of the amount not exceeding fifty per cent of the profit as is debited to the profit and loss account of the previous year in respect of which the deduction is to be allowed and credited to a reserve account (to be called the "Special Economic Zone Re-Investment Reserve Account") to be created and utilized for the purposes of the business of the assesse in the manner laid down.

15-Mar-2017: Launch of Trade Infrastructure for Export Scheme (TIES)

The government has launched the Trade Infrastructure for Export Scheme (TIES). The Scheme is focussed on addressing the needs of the exporters. The scheme replaces a centrally sponsored scheme — Assistance to States for creating Infrastructure for the Development and growth of Exports (ASIDE).

The objective of the proposed scheme is to enhance export competitiveness by bridging gaps in export infrastructure, creating focused export infrastructure, first mile and last mile connectivity for export-oriented projects and addressing quality and certification measures.

The Central and State Agencies, including Export Promotion Councils, Commodities Boards, SEZ Authorities and Apex Trade Bodies recognised under the EXIM policy of Government of India; are eligible for financial support under this scheme.

The Central Government funding will be in the form of grant-in-aid, normally not more than the equity being put in by the implementing agency or 50% of the total equity in the project. (In case of projects located in North Eastern States and Himalayan States including J&K, this grant can be up to 80% of the total equity). The grant in aid shall, normally, be subject to a ceiling of Rs 20 Cr for each infrastructure project.

The implementing agencies shall provide details of the financing tie-ups for the projects which will be considered before approval of the project. Disbursement of funds shall be done after financial closure is achieved.

The scheme would provide assistance for setting up and up-gradation of infrastructure projects with overwhelming export linkages like the Border Haats, Land customs stations, quality testing and certification labs, cold chains, trade promotion centres, dry ports, export warehousing and packaging, SEZs and ports/airports cargo terminuses.

19-Jul-2022: Transshipment hub

Currently, nearly 75% of India’s Transshipment cargo is handled at ports outside India. The Ports of Colombo, Singapore, and Klang handle more than 85% of this cargo. Developing a port into Transshipment Hub will accrue significant benefits such as forex savings, foreign direct investment, increased economic activity at other Indian Ports, development of related logistics infrastructure, employment generation, improve operation/logistics efficiencies and increase in revenue share. Several other allied businesses viz. ship chandlery-ship supplies, ship repair, crew change facility, logistics value added services, warehousing and bunkering also come up at the Transshipment port.

The Ministry of Ports, Shipping & Waterways is in receipt of suggestions from stakeholders to make Visakhapatnam as Transshipment Hub. Presently, however, these proposals namely developing Galathea Bay at Great Nicobar Islands, development of Cochin Port into Transshipment facility have been taken up by the Government of India. This apart, the State Government of Kerala in association with Private Investor and partial financial support from the Ministry of Finance (Government of India) is also developing a Transshipment project at Vizhinjam in Kerala.

Tariff Guidelines, 2021 provide the flexibility of fixing the market determined tariff to PPP Operators thereby creating a healthy competition leading to rationalization of logistics costs.