Services Export from India Scheme (SEIS)
What is Foreign Trade Policy?
Foreign Trade Policy
The foreign trade policy is essentially a set of guidelines for the import and export of goods and services
These are established by the Directorate General of Foreign Trade (DGFT), the governing body for the promotion and facilitation of exports and imports under the Ministry of Commerce and Industry
Contents of FTP
There are total 9 chapters in Foreign Trade Policy
SEIS has been mentioned in Chapter – 3
Objectives of FTP
The main aim is not the mere earning of foreign exchange, but encouraging greater economic activity
1.To enable substantial growth in exports from India.
2.To increase India’s share in global trade.
3.To improve the balance of payment and trade.
4.To act as an effective instrument of economic growth by creating employment opportunities for the citizens.
5.To provide for easy access to essential raw materials for production and other components, consumables, and capital goods required for increasing production and providing efficient services.
6.To raise the technological capacity for production and cost-effectiveness of industry and services, thereby improving their competitive strength in comparison to other countries, and to encourage the accomplishment of internationally accepted standards of quality.
To provide buyers or clients with high-quality goods and services at globally competitive rates and quality
Creation of opportunities by engaging in good and ethical practices.
Accelerating the economy from low-level economic activities to high-level economic activities by making it a globally oriented and vibrant economy
To derive maximum benefits from expanding the global market and seizing the best opportunities available
Making policies that favor ease of doing business and e-governance
To allow for hassle-free transactions for both import and export
What is SEIS Scheme and objectives?
An incentive is given by the Ministry of Commerce through the Directorate General of Foreign Trade (DGFT) to Service Exporters based in India
SEIS was introduced on 1st April 2015 under the Foreign Trade Policy (FTP) 2015-20. Foreign Trade Policy 2015 2020 (FTP) was notified by the Central Government, in the exercise of powers conferred under section 5 of the Foreign Trade (Development & Regulation) Act, 1992
FTP 2015-20 was earlier valid till 31 March 2020. However, due to the COVID-19 outbreak, the validity of FTP has been extended till 31 March 2021 and now up to 30th Sept 2021
Earlier, this Scheme was named as Served from India Scheme (SFIS Scheme) during the period 2009-14
The objective is to boost and maximize the export of notified/selected Services from India
Under the scheme, Exporters of selected services are entitled to a 3% / 5% / 7% incentive on the Net Foreign Exchange (NFE) earned in the form of Duty Credit Scrips
What is Duty Credit Scrip?
SEIS Incentives/Rewards are given in the form of Duty Credit Scrip (DCS)
It is also known as SEIS Scrip or SEIS License
These scrips are issued by DGFT only
It is a document that allows the entitled holder to discharge Customs Duty levied on the import of various goods
The SEIS Scrips are “Freely Transferable” in nature. It means that these scrips can be encashed in the open market by selling them to any Importer/person who can utilize them for payment of duties. Therefore, it is as good as cash equivalent Incentive Scheme
- These Scrips cannot be used for payment of GST
- Further, on sale in the open market, the same is treated as Exempt. Reversal of ITC is required in terms of CGST Rules for common inward supplies
- Validity of Duty Credit Scrips: 24 months from date of issue and must be valid on the date on which actual debit of duty is made. Revalidation of DCS shall not be permitted unless validity has expired while in the custody of Customs Authority / Regional Authority (RA)
- Denomination – Duty Credit Scrips can be single or they can be split into multiple DCS as per the applicant’s discretion (subject to a minimum multiple of Rs 5 Lacs). For Example, If the amount of reward is Rs.50 Crore, the Applicant can apply for 10 DCSs of Rs. 5 Crore each
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