Trade policy review report by the secretariat



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Source: WTO Secretariat; Central Board of Excise & Customs (2011), Customs Manual on Self-Assessment 2011; Ministry of Home Affairs online information; Central Insecticide Board and Registration Committee online information; Ministry of Environment, Forest and Climate Change online information; Department of Consumer Affairs online information.

Table A3. 4 Export prohibitions, 2014

Reason for prohibition

Description

Protection of wildlife under the Wild Life (Protection) Act 1972

All wild animals, animal articles (including their products and derivatives), excluding those for which ownership certificates have been granted and those required for transactions for education, scientific research, and management under the Wild Life (Protection) Act 1972, including their parts and products

Live exotic birds, excluding albino budgerigars, budgerigars, Bengali finches, white finches, and zebra finches, which may be exported subject to preshipment inspection; and java sparrows, which are subject to export licensing

Marine species and their parts, products, and derivatives under the Wild Life (Protection) Act 1972

Bêche-de-mer (sea cucumber)



Control of poaching and illegal trade in wildlife and its products

Peacock tail feathers, including handicrafts and articles of peacock tail feathers

Shavings of shed antlers of Chital and Sambhar, including manufactured articles

Sea shells, including polished sea shells and handicrafts made out of those species mentioned in the Wild Life (Protection) Act 1972


Social and religious reasons

Beef of cows, oxen and calf

Offal of cows, oxen, and calf

Meat of buffalo (both bone-in and boneless)

Tallow, fat and/or oils of any animal origin, excluding fish oil, buffalo tallow and lanolin

Human skeletons


Ecological and environmental reasons

Undersized rock lobsters and sand lobsters

Chemicals under the Montreal Protocol when exported to a country that is not party to the Protocol

Plants and plant portions of wild species specified in the Wild Life (Protection) Act 1972 or the CITES Appendix I or in the Export Licensing Note 1a

Wood and wood products in forms of logs, timber, stumps, roots, barks, chips, powder, flakes, dust, pulp, and charcoalb, other than sawn timber made exclusively out of imported logs/timber

Fuel wood in logs, billets, twigs, faggots or similar forms; wood in chips or particles; and sawdust and wood waste and scrap, whether or not agglomerated in logs, briquettes, pellets or similar forms

Wood charcoal whether or not agglomeratedb

Wood sawn or chipped lengthwise, sliced or peeled, whether or not planed, sanded or end jointed, of a thickness exceeding 6 mm, other than sawn timber made exclusively out of imported logs/timber

Sandalwood in any form, excluding finished handicraft products of sandalwood, machine finished sandalwood products, and sandalwood oil

Red sanders wood in any form, whether raw, processed or unprocessed, excluding value‑added products of red sanders wood (e.g. extracts, dyes, musical instruments, and parts of musical instruments, furniture, parts of various sizes of furniture (subject to DGFT notification No.54 of 3 December 2013), toys, dolls and other handicrafts made from red sanders wood procured from legal sources


Natural resources conservation

Mechanical wood pulp

Chemical wood pulp, dissolving grades

Chemical wood pulp, soda or sulphate, other than dissolving grades

Chemical wood pulp, sulphite, other than dissolving grade

Semi‑chemical wood pulp


Family planning scheme

Condomsc

Ensuring domestic availability/food security

Dried leguminous vegetables, shelled, whether or not skinned or split, excluding kabuli chana (chickpea), and 10,000 tonnes of organic pulses during 2011-12d

All edible oile



Implementing the Chemical Weapons Convention

Toxic chemicals (Chemical Weapons Convention, Schedule 1)

a For Export Licensing Note 1, see the Export Policy Schedule (Chapter 12). Exemptions for research, education, and lifesaving drugs are granted by the DGFT, upon recommendations by the Ministry of Environment and Forests & Climate Change.

b Exemption from prohibition has been given for export of wood charcoal to Bhutan from 23 December 2013.

c Certain brands and those with certain markings/stamps (see the Export Policy Schedule (Chapter 40)).

d Pulses may be exported to Sri Lanka under specific permission granted by DGFT. The prohibition does not apply to export of pulses to Bhutan.

e Exemptions apply to: exports of castor oil; exports of coconut oil from all EDI ports and all Land Custom Stations (LCS) on Indo-Nepal, Indo-Bangladesh, Indo-Bhutan and Indo-Pakistan borders; deemed exports of edible oils (as input raw material) from the domestic tariff area (DTA) to 100% to EOUs for production of non-edible goods to be exported; exports of oils produced out of minor forest produce, even if edible; exports of edible oil from DTA to special economic zones (SEZs) for consumption by SEZ units in manufacture of processed food products subject to applicable value addition norms and 10,000 tonnes of organic edible oils per year subject to the conditions notified in Notification No.50 of 3 June 2011. Further export of edible oils in branded consumer packs of up to 5 kg is permitted subject to minimum export price of US$1,100 per tonne (as amended from time to time). The prohibition will not apply to export of edible oil to Bhutan.

Source: WTO Secretariat, based on information provided by the Indian authorities.

Table A3. 5 Export incentive schemes, 2014

Scheme

Description

Duty exemption schemes

Advance Authorization Scheme (previously Advance Licence Scheme)


An Advance Authorization is issued to allow duty free import of inputs, which are physically incorporated in export product (making normal allowance for wastage). In addition, fuel, oil, catalysts which are consumed/utilized to obtain export product, may also be allowed. DGFT, by means of Public Notice, may exclude any product(s) from the purview of Advance Authorization. Mandatory spares which are required to be exported/supplied with the resultant product can be allowed duty free but up to 10% of c.i.f. value of Authorization.

Advance Authorization can be issued either to a manufacturer exporter or a merchant exporter tied to supporting manufacturer(s). Advance Authorization shall be issued for physical exports (including exports to SEZ) and/or intermediate supplies; and/or supply of goods that are allowed in Chapter 8 of the FTP. Supply of "stores" on board of foreign going vessel/aircraft subject to condition that there is specific SION in respect of item(s) supplied. In addition, in respect of supply of goods to specified projects mentioned in paragraph 8.2 (d), (f) and (j) of FTP, an Advance Authorization can also be availed by sub-contractor to such project provided name of sub-contractor(s) appears in main contract.

Advance Authorization and/or materials imported thereunder will be with actual user condition. It will not be transferable even after completion of export obligation. However, Authorization holder will have option to dispose of product manufactured out of duty free inputs once export obligation is completed.

Advance Authorization necessitates exports with a minimum value addition of 15%, except for items specified in Appendix 11B of HBP v1 and for items in gems & jewellery sector, for which value addition would be as per paragraph 4A.2.1 of HBP v1.

Export obligation shall be fulfilled within 18 months except in case of supplies to projects/turnkey projects in India/abroad under deemed exports category where EO must be fulfilled during contracted duration.


Duty-Free Import Authorization (DFIA) Scheme


DFIA is issued to allow duty free import of inputs, fuel, oil, catalyst which are required for production of export product. DGFT, by means of Public Notice, may exclude any product(s) from purview of DFIA. It shall be issued only for products for which Standard Input and Output Norms (SION) have been notified.

A minimum 20%-value addition shall be required for issuance of DFIA. However, for items in gems and jewellery sector value addition as prescribed under paragraph 4A.2.1 of HBP v1. shall apply. Similarly, for items where a higher value addition has been prescribed under Advance Authorization Scheme, the same value addition for DFIA shall be applied.

DFIA is transferable and once transferability is endorsed, authorization holder may transfer DFIA or duty free inputs, except fuel and any other item(s) notified by DGFT. However, for fuel, import entitlement may be transferred only to companies which have been granted authorisation to market fuel by the Ministry of Petroleum and Natural Gas.

Export obligation shall be fulfilled within 18 months except in case of supplies to projects/turnkey projects in India/abroad under deemed exports category where EO must be fulfilled during contracted duration.



Duty Remission Scheme

Duty Entitlement Passbook (DEPB) Scheme

The scheme was eliminated on 1 November 2011; it aimed at neutralizing the incidence of customs duty on imports of inputs for the manufacture of export products.

Reward schemes

Served from India Scheme


The objective of the Scheme is to accelerate growth in export of services so as to create a powerful and unique "Served From India" brand, instantly recognized and respected the world over. Indian Service Providers, of listed services are entitled to Duty Credit Scrip at 10% of the net foreign exchange earned. However, services and service providers listed in Para 3.6.1 of Hand Book of Procedures Vol. 1 are not eligible. Import are allowed with actual user condition for import of capital goods including spares, office equipment, consumables, vehicles which are in the nature of professional equipment to the service provider.

Special Agricultural and Village Industry Scheme (Vishesh Krishi and Gram Udyog Yojana)


Objective of this scheme is to promote employment generation in rural and semi urban areas. Duty Credit Scrip benefits are granted with an aim to compensate high transport costs, and to offset other disadvantages. Vishesh Krishi And Gram Udyog Yojana has been gradually expanded to include export of Agricultural Produce and their value added products; Minor Forest Produce and their value added variants; Gram Udyog Products; Forest based products and Other Products, as notified under Appendix 37A of HBP v1, from time to time.

Exporters of notified products are entitled for Duty Credit Scrip equivalent to 5% of f.o.b. value of exports (in free foreign exchange) for export. Few products are also eligible to additional 2% over & above 5% as admissible for specified products in Appendix 37A of HBP v1.



Agri-Infrastructure Incentive Schemec


Status Holders (having status recognition) exporting products covered under ITC HS Chapters 1 to 24 , shall be granted Duty Credit Scrip equal to 10% of f.o.b. value of agricultural exports (including VKGUY benefits entitled under Policy Para 3.13.2) for exports made during a particular year. This shall be subject to the condition that the total benefits for all status holders put together does not exceed Rs 100 Cr (i.e. Rs 50 Cr for each half year) and the conditions specified in Para 3.7.2 of HBPv1 are satisfied.

The following capital goods/equipment shall be permitted for import:

(i) Cold storage units (including Controlled Atmosphere (CA) and Modified Atmosphere (MA) Stores); precooling units and mother storage units for onions, etc.;

(ii) Pack houses (including facilities for handling, grading, sorting and packaging etc.); for items notified in Appendix 37 F.

(iii) Reefer van/containers; and

(iv) Other capital goods/equipment as may be notified in Appendix 37 F.



Focus Market Scheme


Focus Market Scheme has been launched for offsetting high freight cost and other externalities to select international markets with a view to enhance India's export competitiveness in these countries. Exporters of all products to notified countries (as in Table 1 & Table 2 of Appendix 37C of HBPv1) shall be entitled for Duty Credit Scrip equivalent to 3% of f.o.b. value of exports. However, additional duty credit scrip at 1% f.o.b. value of exports is given to markets listed in Table 3 of Appendix 37C under Special Focus Market Scheme. New markets have been added to the Special Focus Market Scheme from time to time.

Focus Product Scheme


Focus Products Scheme is aimed to incentivise export of such products which have high export intensity/employment potential, so as to offset infrastructure inefficiencies and other associated costs involved in marketing of these products.

Exports of notified products (as in Appendix 37D of HBPv1) to all countries (including SEZ units) shall be entitled for Duty Credit Scrip equivalent to 2% or 5% of f.o.b. value of exports (in free foreign exchange).

Export of Products/Sectors of high export intensity/employment potential (which are not covered under present FPS List) would be incentivized at 2% of f.o.b. value of exports (in free foreign exchange) under FPS when exported to the Linked Markets (countries), which are not covered in the present FMS list. Such products will be listed in Table 2 or Table 3 of Appendix 37D of HBPv1.

Incentive to the products listed in Table 3 will be in addition to any benefit which the same item may be entitled to under Table 1 or Table 2 of Appendix 37D.



Status Holder Incentive Scheme


The scheme was discontinued on 1 April 2013.

The scheme was aimed at promoting investment for technology upgrading in the leather, textile and jute, handicrafts, engineering, plastics, and basic chemical (excluding pharma) subsectors;

Exporters were granted a duty credit equivalent to 1% of the f.o.b. value of exports over 2009‑10. The duty credit had also been granted to exporters of additional subsectors in 2010‑12f;

Exporters who had benefited from the Technology Upgradation Fund Scheme of the Ministry of Textiles, were not eligible.



Export Promotion Capital Goods Scheme

Zero-duty rate


Exporters of specific products may import capital goods duty free to manufacture export products, subject to an export obligation of six times the amount of the duty saved, to be met within six years. Exporters who have benefited from the Status Holder Incentive Scheme or the Technology Upgradation Fund Scheme (of the Ministry of Textiles) are not eligible;

The scheme was in place until 31 March 2013. Subsequently w.e.f. 18.4.2013 only one scheme i.e. the zero duty EPCG scheme is in force and is available to all sectors and irrespective of whether TUFS benefit has been availed or not.



Concessional rate


Manufacturers of exports may import capital goods at a 3% duty rate, subject to an export obligation of: (i) eight times the amount of the duty saved, to be met within eight years; (ii) six times the amount of the duty saved for agri units, to be met within 12 years; and (iii) six times the amount of the duty saved for micro and small enterprises, to be met within eight years, and the c.i.f. value of imports should not exceed Rs 5 million and total investment after imports should not exceed the limits prescribed to maintain the micro and small enterprises status (Chapter II(4)(i)(c)). If the duty saved amounts to at least Rs 1 billion, the export obligation is to be met within 12 years for all manufacturers;

Service providers certified as common service provider by the DGFT may also import capital goods to export services at a 3% duty rate. The export obligation is eight times the amount of the duty saved, to be met within eight years.

The 3% duty rate EPCG scheme was substituted by the Zero duty EPCG scheme w.e.f. 18.04.2013 which is available to all sectors and is irrespective of whether TUFS benefit has been availed or not.


Schemes for gems and jewellery




Exporters of gold/silver/platinum jewellery and articles thereof may import their essential inputs such as gold, silver, platinum, mountings, findings, rough gems, precious and semi‑precious stones, synthetic stones and unprocessed pearls etc. in accordance with the procedure specified in this behalf. They can obtain gold/silver/platinum as an input for export products from nominated agencies in advance or as replenishment after exports in accordance with specified procedure.

Replenishment authorization


Replenishment authorizations are granted against exports of gold, platinum and silver jewellery and articles made of gold, platinum and silver. Application shall be filed within six months following the month during which the export proceeds are realized.

Gem REP Authorizations shall also be valid for import of empty jewellery boxes up to 5% of value of Authorization within its overall c.i.f. value. Gem REP authorizations issued against export of studded gold/silver/platinum jewellery articles, shall also be valid for import of cut and polished precious/semi-precious stones other than emerald up to 10% of c.i.f. value of Authorization within its overall c.i.f. value. Such Gem REP authorizations are freely transferable.

Exporters can also import duty free consumables, tools and other items namely, tags and labels, security censor on card, staple wire, poly bag (as notified by Customs) for jewellery made out of precious metals (other than gold & platinum) equal to 2% and for cut and polished diamonds and jewellery made out of gold and platinum equal to 1% of f.o.b. value of exports of the preceding year under replenishment authorization However, in case of Rhodium finished silver jewellery, entitlement will be 3% of f.o.b. value of exports of such jewellery. This Authorization shall be non-transferable and subject to actual user condition.


Advance Authorization Scheme for gems and jewellery


Procedure applicable to Advance Authorization under Chapter 4 of HBP shall generally apply to this scheme except norms for Value addition/EO period and regularisation of default. Value addition for Gems and Jewellery items shall be as per para 4A.2 of HBPV1.

Advance authorization holder may obtain gold/silver/platinum from nominated agencies in lieu of direct imports.



Export and Trading Houses Scheme

Merchant as well as manufacturer exporters, service providers, Export Oriented Units (EOUs) and units located in Special Economic Zones (SEZs), Agri. Export Zones (AEZs), Electronic Hardware Technology Parks (EHTPs), Software Technology Parks (STPs) and Bio-Technology Parks (BTPs) shall be eligible for recognition as a status holder.

Status recognition depends upon export performance. An applicant shall be categorized as status holder upon achieving export performance indicated in para 3.10.2 of FTP. The criterion is based on export performance. The export performance is counted on the basis of FOB value of export proceeds realized during current plus previous three years (taken together).For Export House (EH) status, export performance is necessary in at least two out of four years.

exporters in Small Scale Industry (SSI)/tiny sector/cottage sector, units registered with KVICs/KVIBs, units located in North Eastern States, Sikkim and Jammu & Kashmir, units exporting handloom/handicrafts/hand knotted or silk carpets, exporters exporting to countries in Latin America/CIS/sub-Saharan Africa as listed in Appendix-9, Units having ISO 9000 (series)/ISO 14 000 (series)/WHOGMP/HACCP/SEI CMM level-II and above status granted by agencies listed in Appendix-6 of HBP v1, exports of services and exports of agro products shall be entitled for double weightage on exports made for grant of status. Double weightage shall be admissible to merchant as well as manufacturer exporters.

However, a shipment can get double weightage only once in any one of above categories.



Source: WTO Secretariat, based on information provided by the Indian authorities.

Table A3. 6 Amount forgone/disbursed on imports under export promotion schemes, 2011-14



(Rs million)

Scheme

Amount forgone-disbursed

2011-12

2012-13

2013-14

Advance Authorization Scheme (previously Advance Licence Scheme)

183,060

189,710

209,560

Duty‑Free Import Authorization Scheme

12,440

17,350

33,650

Duty Entitlement Passbook (DEPB) Scheme

104,090

27,090

4,340

Served from India Scheme

5,560

5,900

6,390

Special Agricultural and Village Industry Scheme (Vishesh Krishi and Gram Udyog Yojana)

22,630

23,820

24,420

Focus Market/Product Scheme

39,510

61,780

101,820

Export Promotion Capital Goods Scheme

96,720

112,180

89,900

Duty‑Free Entitlement Credit Certificate Scheme

1,900

1,420

2,350

Duty‑Free Replenishment Certification Scheme

400

210

20

Target Plus Scheme

4,360

5,920

8,840

Total

470,670

445,380

481,290

Source: Government of India online information. Viewed at: http://indiabudget.nic.in/budget2013-2014/ub2013-14/statrevfor/annex12.pdf and http://indiabudget.nic.in/ub2014-15/statrevfor/annex12.pdf.

Table A3. 7 Selected incentive schemes/programmes for MSMEs, 2014



Scheme/programme

Eligibility

Description

Introduction/ validity

Implemented by the Ministry of Micro, Small, and Medium Enterprises

Entrepreneurship Development Institutions (EDIs) Scheme

EDIsa

Assistance is provided to create, strengthen or expand infrastructure (including opening of new branches) and to meet deficits. The subsidy amounts to 50% of the cost of building, training, and other support services, up to Rs 10 million.

2010/ongoing

Rajiv Gandhi Udyami Mitra Yojanab

New micro and small entrepreneur

Financial assistance to Udyami Mitrasc is provided by selected agenciesd. It amounts to Rs 4,000/trainee for service enterprises and Rs 6,000/trainee for manufacturing enterprises (with investment in plants and machinery up to Rs 2.5 million). Trainees contribute to Rs 1,000 to the financial assistance. The beneficiary's contribution of Rs 1,000 shall be provided as a Grant under RUGMY for the beneficiaries from special category.

2008/ongoing

Implemented by the Development Commissioner

Management Development Programme

Prospective/

existing MSMEs



The programme is aimed at training prospective/existing entrepreneurs by upgrading their managerial skills. No financial incentives are provided.

1952/ongoing

Credit Guarantee Fund Scheme for Micro and Small Enterprises

All MSEs, except retail trade and self-help groups

Credit is guaranteed by financial institutionse. The guarantees to new and existing micro and small enterprises up to Rs 10 million per borrowing unit. The guarantee cover provided up to 75% of the credit facility up to Rs 5 million (85% for loans up to Rs 0.5 million provided to micro enterprises, 80% for MSEs owned/operated by women and all loans to NER) with a uniform guarantee at 50% of the credit exposure above Rs 5 million and up to Rs 10 million.

2000/ongoing

Credit Linked Capital Subsidy Scheme for Technology Upgradation

Manufacturing MSEs

The subsidy amounts to 15% of the capital acquired to upgrade technology, up to Rs 1.5 million.

2001/ongoing


Micro and Small Enterprises Cluster Development Programmef

All MSEs

Grant of maximum Rs 250,000 will be provided for preparation of diagnostic study report (DSR) for one cluster. For the field organizations of the Ministry of MSME, this financial support will be Rs 100,000. For soft interventions, maximum limit for project cost would be Rs 2.5 million per cluster. The Government's grant for the soft interventions will be 75% of the sanctioned amount of the project cost. For NE & Hill States, clusters with more than 50% (a) micro/village (b) women owned (c) SC/ST units, the grant will be 90%. For preparation of "detailed project report", a grant of maximum Rs 500,000 will be provided for preparation of a technically feasible and financially viable project report for setting up of a common facility centre for a cluster of MSE units and/or infrastructure development project for new industrial estate/area or for upgrading of existing infrastructure in existing industrial estate/area/cluster. For hard interventions (setting up of CFCs), grant will be restricted to 70% of the cost of project of maximum Rs 1.5 million.

Grant will be 90% for CFCs in NE & Hill States, clusters with more than 50% (a) micro/village (b) women owned (c) SC/ST units. The cost of project includes cost of land (subject to max. of 25% of project cost), building, pre-operative expenses, preliminary expenses, machinery and equipment, miscellaneous fixed assets, support infrastructure such as water supply, electricity and margin money for working capital.



2010/ongoing

ISO 9001/14001 and HACCP Certification Reimbursement Scheme

All MSEs

Reimbursement of 75% of the certification expenses up to a maximum of Rs 75,000 to each unit as one-time reimbursement only to those MSEs which have acquired Quality Management Systems (QMS)/ISO 9001 and/or Environment Management Systems (EMS)/ISO 14001 and/or Food Safety Systems (HACCP) Certification.

1994/ongoing

Marketing Development Assistance Scheme (SSI-MDA)

Exporting manufacturing MSMEs

MSMEs participating in international exhibitions/trade fairs, are reimbursed 75% of the economy air fare and 50% of the space rental charges (100% for special categories), up to Rs 125,000.

2000/ongoing



Mini Tool Rooms

Individual MSEs/MSE consortium

Discontinued

Discontinued from the period subject to the 12th Five Year Plan

Scheme for Micro Finance Programme

Micro finance institutions

The Government provides a Portfolio Risk Fund to the Small Industries Development Bank Of India (SIDBI). The Fund is used to guarantee loans taken by micro finance institutions or NGOs.

2004/ongoing


Implemented by the National Small Industries Corporation (NSIC)

Government Stores Purchase Programme

MSEs registered with NSIC

The units registered under Single Point Registration Scheme of NSIC are eligible to receive benefits under "Public Procurement Policy for MSEs Order 2012". These include: issue of the Tender Sets free of cost; exemption from exemption from payment of Earnest Money Deposit (EMD); in tender participants, MSES quoting price within price band of L1+15% will be allowed to supply a portion up to 20% of requirement by bringing down their price to L1 price where L1 is non-MSEs'; every central ministries/departments PSUs shall set an annual goal of minimum 20% of the total annual purchase of the products or services produced or rendered by MSEs; out of the annual requirement of 20% procurement from MSEs, 4% is earmarked for units owned by Schedule Caste/Schedule Tribes; 358 items are reserved for exclusive purchase from SSI Sector.

1955/ongoing

Marketing Assistance Scheme

All MSMEs (Maximum amount towards air fare, space rental and shipping/transportation charges)

General category: for micro enterprises, Rs 240,000 in Latin America and Rs 200,000 in other countries; for small enterprises, Rs 210,000 in Latin America and Rs 175,000 in other countries; and for medium enterprises, Rs 125,000 in Latin America and Rs 100,000 in other countries.

Enterprises belonging to NE Region/Women/SC/ST Category: for micro enterprises, Rs 270,000 in Latin America and Rs 225,000 in other countries; for small enterprises, Rs 240,000 in Latin America and Rs 200,000 in other countries; and for medium enterprises, Rs 160,000 in Latin America and Rs 125,000 in other countries.



Ongoing

Performance and Credit Rating Scheme

All MSEs

MSEs may select a rating agency to obtain a credit rating. The subsidy amounts to 75% of the fee charged by the rating agency, up to Rs 40,000.

2005/ongoing

Raw Materials Assistance Scheme

MSMEs

Short term credit finance is available for 90 days at concessional interest rates. The rate of interest and assistance against the security of BG/SDR/FDRg, effective 1 February 2013, are: 11.95% (units having valid SE !A rating under NSIC's rating scheme); 12.45% (units having valid SE 2A or SE 1B rating under NSIC's rating scheme); and 12.95% (other units).

2004/ongoing

Implemented by the Khadi and Village Industries Commission (KVIC)

Prime Minister's Employment Generation Programmeb

New micro entrepreneurs

The subsidy amounts to 15% of the cost of establishing new micro enterprises in urban areas (25% for special categories); and 25% of the cost of establishing new micro enterprises in rural areas (35% for special categories). Maximum cost is Rs 2.5 million for setting up new manufacturing micro enterprises and Rs 1 million for setting up new micro enterprises engaged in services.

2008/ongoing

Implemented by the Coir Board

Rejuvenation, Modernization, and Technological Upgradation of Coir Industry

Micro and small coir enterprises

The financial assistance or government grant/subsidy will be 40% of the Project cost. The maximum amount of admissible cost of the project is enhanced to Rs 1 million for the purpose of government subsidy, excluding working capital which must not exceed 25% of the project cost.

2008/ongoing

a National Institute for Micro, Small and Medium Enterprises, National Institute for Entrepreneurship and Small Business Development, and Indian Institute of Entrepreneurship.

b The Rajiv Gandhi Udyami Mitra Yojana scheme and the Rural Employment Generation Programme were merged into the Prime Minister's Employment Generation Programme in August 2008.

c Selected lead agencies for rendering assistance and handholding support to potential first generation entrepreneurs.

d Entrepreneurship Development Institutions, the National Small Industries Corporation (NSIC), the Khadi and Village Industries Commission (KVIC), and the Coir Board.

e Public and Private Sector Banks, Regional Rural Banks, Foreign Banks, and other Financial Institutions.

f The Micro and Small Enterprises Cluster Development Programme was merged with the Integrated Infrastructure Development Scheme in February 2010.

g BG: Bank Guarantees; SDR: Short Deposit Receipts; and FDR: Fixed Deposit Receipts.

Note: "Special categories" refer to MSMEs operated/owned by women or scheduled castes/scheduled tribes or located in the north eastern region.

Source: WTO Secretariat, based on information provided by the Indian authorities.

Table A3. 8 Top 20 patent applicants, 2014



Sl.No.

Patent owner

Country

1

Council for Scientific and Industrial Research

India

2

Qualcomm Incorporated

United States

3

Samsung Electronics Co. Ltd.

Republic of Korea

4

Hindustan Unilever

India

5

Ericsson Ltd.

Sweden

6

Siemens

Germany

7

Tata Group

India

8

Bharat Heavy Electricals Ltd.

India

9

BASF Aktiengesellschaft

Germany

10

Motorola

United States

11

Philips

Netherlands

12

General Motors Global

United States

13

Thomson Licensing

France

14

LG Electronics

Republic of Korea

15

Nokia Corporation

Finland

16

SONY Corporation

Japan

17

Honda Giken Kogyo Kabushiki Kaisha

Japan

18

IBM

United States

19

Research in Motion

Canada

20

Proctor and Gamble

United States

Source: WTO Secretariat, based on information provided by the Indian authorities.

Table A4. 1 Legislation related to pipeline transport for petroleum and natural gas, 2014



Name of legislation

The Petroleum & Minerals Pipelines (Acquisition of Right of User in Land) Amendment Act, 2011

Petroleum and Natural Gas Regulatory Board (Authorizing Entities to Lay, Build, Operate or Expand Natural Gas Pipelines) Regulations, 2008

Petroleum and Natural Gas Regulatory Board (Determination of Natural Gas Pipeline Tariff) Regulations, 2008

Petroleum and Natural Gas Regulatory Board (Affiliate Code of Conduct for Entities Engaged in Marketing of Natural Gas and Laying, Building, Operating or Expanding Natural Gas Pipelines) Regulations, 2008

Petroleum and Natural Gas Regulatory Board (Access Code of Conduct for Common Carrier or Contract Carrier Natural Gas Pipelines) Regulations, 2008

Petroleum and Natural Gas Regulatory Board (Guiding Principles for Declaring or Authorizing Natural Gas Pipelines as Common Carrier or Contract Carrier) Regulations, 2009

Petroleum and Natural Gas Regulatory Board (Technical Standards and Specifications including Safety Standards for Natural Gas Pipelines) Regulations, 2009

Petroleum and Natural Gas Regulatory Board (Determining Capacity of Petroleum, Petroleum Products and Natural Gas Pipelines) Regulations, 2010

Petroleum and Natural Gas Regulatory Board (Integrity Management System for Natural gas Pipelines) Regulations, 2012

Petroleum and Natural Gas Regulatory Board (Imbalance Management Services) Regulations, 2014

Petroleum and Natural Gas Regulatory Board (Development of Model GTA) Guidelines, 2012

Petroleum and Natural Gas Regulatory Board (Capacity Release for Natural Gas Pipeline) Guidelines, 2012

Petroleum and Natural Gas Regulatory Board (Public consultation for Determination of Final Natural Gas Pipeline Tariff) Guidelines, 2012

Modalities of maintaining and operation of Escrow Account under the Petroleum and Natural Gas Regulatory Board (Access Code for Common or Contract Carrier Natural Gas Pipelines)Regulations, 2008

Petroleum and Natural Gas Regulatory Board (Protection of Consumer Interest in respect of Dedicated Pipelines for Natural Gas) Guidelines, 2010

Petroleum and Natural Gas Regulatory Board (Authorizing Entities to Lay, Build, Operate or Expand Petroleum and Petroleum Products Pipelines) Regulations, 2010

Petroleum and Natural Gas Regulatory Board (Determination of Petroleum and Petroleum Products Pipelines Transportation Tariff) Regulations, 2010

Petroleum and Natural Gas Regulatory Board (Determining Capacity of Petroleum, Petroleum Products and Natural Gas Pipeline) Regulations, 2010

Petroleum and Natural Gas Regulatory Board (Guiding Principles for Declaring or Authorizing Petroleum and Petroleum Products Pipelines as Common Carrier or Contract Carrier) Regulations

Source: WTO Secretariat, based on information provided by the Indian authorities.

Table A4. 2 India's banking system, 2011 and 2014



Financial institutions

Number

Definition, function, and laws by which they are governed

Requirements for establishment
(if applicable)


2011

2014

Nationals

Foreigners

Scheduled commercial banksa

81

89

Banks included in the Second Schedule of the Reserve Bank of India 1934

-

-

State bank of India (SBI) and associates

6

6

Governed by the State Bank of India Act 1955. The associates are governed by the State Bank of India (Subsidiary Banks) Act 1959c; SBI and associates also governed by the Reserve Bank of India (RBI) Act 1934 and the Banking Regulation Act 1949

Parliamentary approval required; central Government shareholding cannot be less than 51%

FDI and portfolio subject to overall statutory limits of 20%

Nationalized banks

19

19

Governed by the Banking Companies (Acquisition and Transfer of Undertakings) Act 1970 (14 banks) and the Banking Companies (Acquisition and Transfer of Undertakings) Act 1980 (five banks); also regulated by the RBI Act 1934 and the Banking Regulation Act 1949

Parliamentary approval required; central Government shareholding cannot be less than 51%

FDI and portfolio subject to overall statutory limits of 20%

Foreign banks

32

43

Governed by the RBI Act 1934, the Banking Regulation Act 1949, and the Companies Act 1956. The Companies Act 2013 also applies to the extent it is not inconsistent with the Banking Regulation Act 1949

Set up by foreign parent banks

Bank branches of parent banks

Private sector banks

22

20

Companies incorporated under the Companies Act 1956 and licensed under the Banking Regulation Act 1949 (Section 22), to carry on banking businessd; engaged in activities stipulated in the Banking Regulation Act 1949 (Section 6); governed by the RBI Act 1934, the Banking Regulation Act 1949, and the Companies Act 1956. The Companies Act 2013 also applies to the extent it is not inconsistent with the Banking Regulation Act 1949

Guidelines for licensing issued in 1993 (ten banks licensed); revised guidelines issued in 2001 (two banks licensed); and guidelines for licensing of new banks issued in 2013 ("in‑principle" approvals to two applicants)

74% is the maximum aggregate of foreign investment from all sourcese; 26% of paid‑up capital must be held by resident Indians

State cooperative banks

31

32

Principal cooperative society in a State; main objective is to finance other cooperative societies in the state as defined in the National Bank for Agriculture and Rural Development (NABARD) Act 1981 (Section 2(u)); also governed by the RBI Act 1934, the Banking Regulation Act 1949 (as applicable to cooperative societies) and the relevant State's Cooperative Societies Act

Established as per the relevant State's Cooperative Societies Act; licensed by the RBI under the Banking Regulation Act 1949, as applicable to cooperative societies (Section 22)

FDI not allowed

Urban cooperative banks

1,674

1,606

Cooperative societies established and registered under the respective States' Cooperative Societies Act; they are present in 29 states/union territories; under the RBI regulation and supervision since 1 March 1966 when the Banking Regulation Act 1949 applied to them for banking‑related functions; other aspects governed by the respective State's Cooperative Societies Act. Co-operative societies having operation in more than one state are governed by the Multi State Co‑operative Societies Act 2002

Set up by their members who are Indian nationals

FDI not allowed

Central cooperative banks

371

371

Principal cooperative bank in a district in a State. Main objective is to finance other cooperative societies in that district as defined in the National Bank for Agriculture and rural Development (NABARD) Act 1981 (Section 2(d)). They are also governed by the RBI Act 1934, the Banking Regulation Act 1949 (as applicable to cooperative societies), and the relevant State's Co-operative Societies Act, under which the bank is established

Established as per the relevant State's Cooperative Societies Act; licensed by the RBI under the Banking Regulation Act 1949, as applicable to cooperative societies (Section 22)

FDI not allowed

Regional rural banks

82

57

Governed by the Regional Rural Banks (RRBs) Act 1976, the RBI Act 1934, and the Banking Regulation Act 1949; established to develop the rural economy by providing credit and other facilities, in particular to small and marginal farmers, agricultural labourers, artisans, and small entrepreneurs

Under RRBs Act 1976, central Government may, if requested by a sponsor bank, by notification in the Official Gazette, establish one or more RRBs in a State or union territory, and specify the local limits for operation

FDI not allowed

Other institutions

Development finance institutions

5

..

Promoted or assisted by the Government to provide development finance to one or more sectors or subsectors of the economy; classified as term‑lending institutions, refinancing institutions, and sector specific institutions;

governed by the RBI Act 1934 and the respective acts enacted by Parliament (the National Housing Bank Act, the Exim Bank Act, the NABARD Act, and the Small Industries Development Bank of India Act)



Only nationals (Parliamentary approval required). Shareholding is by banks, financial institutions, the Government, or RBI

FDI not allowed

Non‑banking financial companies (NBFCs)

12,409

11,922

Registered under the Companies Act 1956 to provide loans and advances, acquisition of shares/stock/bonds/debentures/securities issued by the Government or local authorities or other securities of like marketable nature, leasing, hire‑purchase, insurance business, and chit businessf; non‑banking institutions whose main business is to receive deposits defined as NBFCs (residuary non‑banking company); NBFCs are governed by the RBI Act 1934 (with the RBI as regulator); NBFCs classified as assent finance companies (AFCs)g, investment companies, loan companies, and infrastructure finance companies (IFCs)h; Systematically Important Core Investment Company (CIC-ND-SI)l; NBFCs-Factorsm; NBFC-MFI (Micro Finance Institution)n; Infrastructure Debt Fund (IDF)o;

Mortgage Guarantee Companies (MGC)p; and Non-operative Financial Holding Company (NOFHC)q.



Under RBI Act 1934 (Section 45‑IA), must register with the RBI to start or carry on any business of NBFC as defined in the RBI Act 1934 (Section 45‑I, clause (a)), and must have minimum net owned fund of Rs 20 million; to prevent dual regulation, certain NBFCs categories, regulated by other regulators, are exempt from the registration requirementi

FDI allowed up to 100% of the paid‑up capital, subject to minimum capitalization norms: (i) foreign equity ≤ 51%, US$0.5 million minimum capitalization requirement; (ii) foreign equity > 51% but ≤ 75%, it is US$5 million; (iii) foreign equity > 75%, it is US$50 million; can set up step down subsidiaries for specific NBFC activities, without any restriction on the number of operating subsidiaries and without bringing in additional capital.

Primary dealers (PDs)

17j

18k

System of PDs in Government securities (G‑Sec) market, comprising independent entities undertaking PD activity; expected to play an active role in the G‑Sec market (primary and secondary market segments); required to support auctions for issue of Government dated securities and treasury bills as per the minimum norms prescribed by the RBI from time to time; stand‑alone PDs registered as NBFCs under the RBI Act 1934 (Section 45‑IA); their operations regulated by RBI guidelines issued from time to time; banks' PD activities governed by guidelines issued by the RBI

Non‑bank applicant must have net owned funds (NOFs) of at least Rs 1.5 billion; a PD undertaking other permissible activities must have NOFs of at least Rs 2.5 billion; banks may undertake PD business departmentally subject to: (i) minimum NOF of Rs 10 billion; (ii) minimum CRAR of 9%; and (iii) net NPAs of less than 3% and a profit‑making record for the last three years

Subsidiaries or joint‑ventures set up by entities incorporated abroad need approval of the Foreign Investment Promotion Board for PD activities



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