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India is an active participant in the global economy. Foreign trade has a prominent role in reaping the benefits of this phenomenon. In this context does the government take any measures to promote foreign trade? Do you think that the Government motivates the Indian entrepreneurs towards this end? Cite examples.

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Foreign Trade Promotion Measures and Schemes. 

1. Duty drawback scheme

It refers to the refund of customs and excise duties paid on imported inputs used in the manufacture of export goods. 

2. Export manufacturing under bond scheme:

Under this facility firms can produce goods without payment of excise and other duties. The firms can avail this facility after giving an undertaking (i.e. bond) that they are manufacturing goods for export purposes. 

3. Exemption from payment of sales taxes:

Goods meant for export purposes are not subject to sales tax. Income derived from export operations had been exempt from payment of income tax. Now, this benefit of exemption from income tax is available only to 100 percent Export Oriented Units (100 percent EOUs) and units set up in Export Processing Zones (EPZs) or Special Economic Zones (SEZs) for selected years. 

4. Advance license scheme: 

It is a scheme under which an exporter is allowed duty free supply of domestic as well as imported inputs required for the manufacture of export goods. 

5. Export Promotion Capital Goods Scheme (EPCG): 

The main objective of this scheme is to encourage the import of capital goods for export production. This scheme allows export firms to import capital goods at zero or concessional rates of import duty. 

6. Scheme of recognising export firms as an export house, trading house and superstar trading house:

The registered exporters having a record of export performance over a number of years are granted the status of export houses/ trading houses/star trading houses/superstar trading houses subject to the fulfillment of annual average export performance. 

7. Export of Services: 

In order to boost the export of services, various categories of service houses have been recognised, i.e. Service Export House, International Service Export House, International Star Service Export House. 

8. Export finance: 

Two types of export finances are made available to the exporters by authorised banks. They are termed as pre-shipment finance and postshipment finance. Pre-shipment finance is provided to an exporter for financing the purchase, processing, manufacturing or packaging of goods for export purposes. Post-shipment finance is provided to the exporter from the date of extending the credit after the shipment of goods to the export country. 

9. Export Processing Zones (EPZs): 

They are industrial estates, which form special enclaves separated from the domestic tariff areas. These are usually situated near seaports or airports. They are intended to provide an internationally competitive duty free environment for export production at low cost. They can import capital goods and raw materials for the production of export goods without a license.

10. 100 percent Export Oriented Units (100 percent EOUs): 

These units are established with the main purpose of exporting their entire production except those which are specifically permitted to be sold in the domestic market. 

11. Special Economic Zone (SEZ): 

It is specifically a delineated duty-free enclave, which is deemed to be foreign territory for the purpose of trading and imposing duties. It provided an internationally competitive and duty-free environment for the production of export of goods.

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