Economy / Foreign Trade / India's Exim Policy: Its Evolution and Content
India's Exim Policy: Its Evolution and Content
India's external trade policies have undergone significant changes since gaining independence in 1947. The early years were marked by protectionism and a focus on import substitution to promote self-reliance. Import substitution involves producing goods domestically rather than relying on imports, especially during the initial stages of economic development.
Evolution of Exim Policy:
- Initial Phase (1947 onwards): Protectionism and import substitution were emphasized to protect the infant economy and manage limited foreign exchange reserves judiciously.
- Mid-1980s: The import substitution policy gave way to economic reforms aimed at easing trade restrictions, enhancing competitiveness, and promoting economic growth. The annual exim policy was replaced by a 3-year foreign trade policy to provide continuity and promote investment.
- 1990s: Real momentum in India's external trade policy and practices began in the 1990s with a series of reforms launched in 1991 as part of liberalization and globalization efforts.
- Reforms: Reforms included a devaluation of the rupee, structural changes like the convertibility of the rupee, liberalization of imports, and long-term exim policies.
- Current Scenario: Presently, most goods can be imported without licenses or restrictions, except for a few items disallowed on environmental, health, and safety grounds. Tariff reforms focused on reducing peak rates to make the domestic economy competitive
