Dear Members,

As per UNCTAD Global Trade Update, July 2024, moderating global inflation and improving economic growth forecasts suggest a reversal of the downward macroeconomic trends that have characterized most of 2023. Additionally, rising demand for products related to energy transition and artificial intelligence should contribute to trade growth through 2024. Furthermore, the possibility of interest rate cuts in the United States later in the year and the consequently weaker United States dollar could give global trade a further boost. However, the global trade outlook for 2024 remains subject to downside risks. Persistent geopolitical tensions, rising shipping costs, and emerging industrial policies could significantly impact global trade. Friendshoring and trade concentration trends continue to shape global trade and global interdependence trends are increasingly shaped by geopolitical and economic factors.

During April-June 2024, Indian merchandise exports increased by 5.8% to US$ 109.96 billion, while services exports expected to increase by 12 to US$ 90.37 billion, thus overall exports increasing by 8.6% to US$ 200.33 billion. As regards SEZs, merchandise exports increased by 19 % to US$ 16.5 billion, while services exports remained unchanged, totalling USD 94.3 billion.

With Hon’ble Shri Narendra Modi assuming the charge of Prime Minister again, policy stability and continuity is expected. EPCES hopes that the long pending reforms in SEZs through amendment in SEZ Act will be carried out in the first 100 days itself by enabling DTA sale on duty foregone principle and payment in INR for DTA supply of services.

Government has decided to implement ICEGATE in SEZs w.e.f. 1.7.2024. EPCES received a number of representations about the shortcomings in the ICEGATE SEZ module and lack of training of SEZ Units in using ICEGATE. On EPCES follow-up, Government decided for parallel operation of existing arrangement through SEZ Online till 15.7.2024 which has now been extended till 13.8.2024. EPCES is taking regular feedback from its members about transition to ICEGATE and informing Government about the shortcomings in the ICEGATE SEZ module. EPCES has also requested Government to first develop the ICEGATE module for SEZs properly, get it tested professionally and have a comprehensive training of SEZ units in using ICEGATE SEZ module. Government should not experiment with the live day to day EXIM transactions of SEZ units with incomplete, untested ICEGATE SEZ module, putting exports from SEZs in jeopardy. This is against the EODB policy of the Government. EPCES has requested Government to continue with SEZ Online unless ICEGATE SEZ module is fully developed and tested and units are properly trained.

With best wishes,