Import And Export Policies.docx

IMPORT AND EXPORT POLICIES The Central Board of Indirect Taxes and Customs (CBIC) has removed customs duty exemption to battery packs for electric vehicles. The government has lowered the customs duty on import of parts and components of electric vehicles in a bid to promote domestic assembly of such vehicles in India. The customs duty on vehicle parts and components imported for assembly in India has so far been 15 to 30 percent. But now, the government has drastically lowered it to 10 to 15 percent. The Central Board of Indirect Taxes and Customs (CBIC) have carved out a separate category for parts and components of an electric vehicle for which customs duty has been lowered to 10-15 percent. Further, the CBIC has removed customs duty exemption to battery packs for electric vehicles and also doubled the duty on battery packs for mobile phones. Henceforth, import of battery packs for electric vehicles will attract 5 percent tax.

Make in India As per the policy, after manufacturing in India, a foreign investor is permitted to sell its products in any manner - wholesale, retail or e-commerce. "FDI policy also permits wholesale of imported goods in India without sourcing conditions," The Mega Agreements: Implications for India The three mega agreements that are currently being negotiated namely the Trans Pacific Partnership, Trans-Atlantic Trade and Investment Partnership and the Regional Comprehensive Economic Partnership (RCEP) add a completely new dimension to the global trading system. India is a party to the RCEP negotiations. The mega agreements are bound to challenge India’s industry in many ways, for instance, by eroding existing preferences for Indian products in established traditional markets such as the US and EU and establishing a more stringent and demanding framework of rules. Indian industry needs to gear up to meet these challenges for which the Government will have to create an enabling environment. Government is committed to transforming India into a manufacturing and exporting hub. This is possible only if India’s products are of world class standard. A roadmap has been developed on

measures required to protect consumers, raise the quality of the merchandise produced and enhance India’s capacity to export to even the most discerning markets. Merchandise Exports from India Scheme (MEIS)

Entitlement under MEIS Exports of notified goods/products with ITC [HS] code, to notified markets as listed in Appendix 3B, shall be rewarded under MEIS. Appendix 3B also lists the rate(s) of rewards on various notified products [ITC (HS) code wise]. The basis of calculation of reward would be on realized FOB value of exports in free foreign exchange, or on FOB value of exports as given in the Shipping Bills in freely convertible foreign currencies, whichever is less, unless otherwise specified.

Ineligible categories under MEIS The following exports categories /sectors shall be ineligible for Duty Credit Scrip entitlement under MEIS (i)

Supplies made from DTA units to SEZ units

(ii)

Export of imported goods covered under paragraph 2.46 of FTP

(iii)

Exports through trans-shipment, meaning thereby exports that are originating in third country but trans-shipped through India

(iv)

Deemed Exports; (v) SEZ/ EOU /EHTP/ BTP /FTWZ products exported through DTA units

(v)

Export products which are subject to Minimum export price or export duty.

(vi)

Exports made by units in FTWZ.

Service Exports from India Scheme (SEIS) Objective of Service Exports from India Scheme (SEIS) is to encourage and maximize export of notified Services from India. Eligibility

(a) Service Providers of notified services, located in India, shall be rewarded under SEIS. Only Services rendered in the manner as per this policy shall be eligible. The notified services and rates of rewards are listed in Appendix 3D. (b) Such service provider should have minimum net free foreign exchange earnings of US$15,000 in year of rendering service to be eligible for Duty Credit Scrip. For Individual Service Providers and sole proprietorship, such minimum net free foreign exchange earnings criteria would be US$10,000 in year of rendering service. (c) Payment in Indian Rupees for service charges earned on specified services, shall be treated as receipt in deemed foreign exchange as per guidelines of Reserve Bank of India. The list of such services is indicated in Appendix 3E. (d) Net Foreign exchange earnings for the scheme are defined as under: Net Foreign Exchange = Gross Earnings of Foreign Exchange minus Total expenses / payment / remittances of Foreign Exchange by the IEC holder, relating to service sector in the Financial year. (e) If the IEC holder is a manufacturer of goods as well as service provider, then the foreign exchange earnings and Total expenses / payment / remittances shall be taken into account for service sector only. (f) In order to claim reward under the scheme, Service provider shall have to have an active IEC at the time of rendering such services for which rewards are claimed. Ineligible categories under SEIS Foreign exchange remittances other than those earned for rendering of notified services would not be counted for entitlement. Thus, other sources of foreign exchange earnings such as equity or debt participation, donations, receipts of repayment of loans etc. and any other inflow of foreign exchange, unrelated to rendering of service, would be ineligible. Entitlement under SEIS Service Providers of eligible services shall be entitled to Duty Credit Scrip at notified rates (as given in Appendix 3D) on net foreign exchange earned. Remittances through Credit Card and other instruments for MEIS and SEIS Free Foreign Exchange earned through international credit cards and other instruments, as permitted by RBI shall also be taken into account for computation of value of exports. Effective date of schemes (MEIS and SEIS) the schemes shall come into force with effect from the date of notification of this Policy, i.e. the rewards under MEIS/SEIS shall be admissible for exports made/services rendered on or after the date of notification of this Policy.

Special Provisions (a) Government reserves the right in public interest, to specify export products or services or markets, which shall not be eligible for computation of entitlement of duty credit scrip. (b) Government reserves the right to impose restriction / change the rate/ceiling on Duty Credit Scrip under this chapter. (c) Government may also notify goods in Appendix 3A which shall not be allowed for debiting through Duty Credit Scrips in case of import. (d) Government may prescribe value cap of any kind for a product(s) or limit total reward per IEC

HOW OTHER ORGANISATIONS ARE GOING TO EFFECT WITH THIS BUSSINESS:-

Like Citron Research, I am surprised at how ineffective the leading car companies have been in developing a "Tesla-killer." Rather than compete with Tesla, Ford seems to be running away. Ford announced they were dropping traditional cars from their product line to focus on crossovers and SUVs. This strategy makes sense from an accountant's point of view as these are Ford's most profitable products. However, since there is no reason Tesla could not make an SUV, Ford's decision to focus on their high-margin products only protects them competing with Tesla for the time being. Mercedes and Volvo have shown concept cars which basically means they are years away from production. GM is currently selling the Chevy Bolt, which on paper looks like a competitor. However, Gorden Lam points out those sales of the Bolt plunged 40% in September while Tesla's Model 3 was the fifth bestselling car. The customers have spoken. Honestly take a look at both cars. Which one you would rather own?

The Award-winning Chevy Bolt EV is presented during the four-day auto trade show Auto Mobility. It's almost as if GM doesn't want to sell too many Bolts. This would make sense if the Bolt is a money-loser and GM only sells it to get ZEV credits. I don't know what GM is thinking, but the Bolt is not a Tesla-killer.