European Free Trade Association

The European Free Trade Association (EFTA) is a free trade organisation between four European countries that operates parallel to, and is linked to,
the European Union (EU).

EFTA was established on 3 May 1960 as a trade bloc-alternative for European states who were either unable to, or chose not to, join the then-European Economic
Community (EEC) which has now become the European Union (EU). The Stockholm Convention, establishing EFTA, was signed on 4 January 1960
in Stockholm by seven countries.

Today, only Iceland, Norway, Switzerland, and Liechtenstein remain members of EFTA (of which Norway and Switzerland are the only remaining founding
members). The initial Stockholm Convention was subsequently replaced by the Vaduz Convention. This Convention provides for the liberalisation of trade
among the member states.

Three of the EFTA countries are part of the European Union Internal Market through the Agreement on a European Economic Area (EEA), which took effect in
1994; the fourth, Switzerland, opted to conclude bilateral agreements with the EU. In addition, the EFTA states have jointly concluded free trade agreements with a
number of other countries.

In 1999 Switzerland concluded a set of bilateral agreements with the European Union covering a wide range of areas, including movement of persons, transport
and technical barriers to trade. This development prompted the EFTA States to modernise their Convention to ensure that it will continue to provide a successful
framework for the expansion and liberalization of trade among them and with the rest of the world.

General Secretaries

General Secretaries of EFTA:

 1960-1965:   Frank E. Figgures

 1965-1972:   Sir John Coulson

 1972-1975:   Bengt Rabaeus

 1976-1981:   Charles Müller

 1981-1988:   Per Kleppe

 1988-1994:   Georg Reisch

 1994-2000:   Kjartan Jóhannsson

 2000-2006:   William Rossier

 2006–present:   Kåre Bryn

Institutions
EFTA is governed by the EFTA Council and serviced by the EFTA Secretariat. In addition, in connection with the EEA Agreement of 1992, two other EFTA
organisations were established, the EFTA Surveillance Authority and the EFTA Court.

EEA-related institutions
The EFTA Surveillance Authority and the EFTA Court regulate the activities of the EFTA members in respect of their obligations in the European Economic
Area (EEA). Since Switzerland is not an EEA member, it does not participate in these institutions.

The EFTA Surveillance Authority performs the European Commission's role as "guardian of the treaties" for the EFTA countries, while the EFTA Court performs
the European Court of Justice's role for those countries.

The original plan for the EEA lacked the EFTA Court or the EFTA Surveillance Authority, and instead had the European Court of Justice and the European
Commission were to exercise those roles. However, during the negotiations for the EEA agreement, the European Court of Justice informed the Council of the
European Union by way of letter that they considered that giving the EU institutions powers with respect to non-EU member states would be a violation of the
treaties, and therefore the current arrangement was developed instead.

The EEA and Norway Grants are administered by the Financial Mechanism Office, which is affiliated to the EFTA Secretariat in Brussels.

Locations
The EFTA Secretariat is headquartered in Geneva, Switzerland. The EFTA Surveillance Authority has its headquarters in Brussels, Belgium (the same location as
the headquarters of the European Commission), while the EFTA Court has its headquarters in Luxembourg (the same location as the headquarters of the
European Court of Justice).
Relationship to the European Economic Area
The EFTA members, except for Switzerland, are also members of the European Economic Area (EEA).
EFTA and the European Union

See also:  Accession of Iceland to the European Union  and  Norway and the European Union

This table summarises the various components of EU laws applied in the EFTA countries and their sovereign
territories. Some territories of EU member states also have a special statusin regard to EU laws applied as is
the case with some European microstates.

EFTA member states EU EU

and sovereign Application Enforceable in local citizen- elec- EU VAT EU customs EU single Euro-
territories of EU law courts? EURATOM? ship? tions? Schengen area? area? territory? market? zone?

Partial Unclear No No No Yes No No Yes[8] No, ISK

 Iceland

Set to implement
 Liechtenstein Partial Unclear No No No No No Yes[8] No,CHF
later

Partial Unclear No No No Yes No No Yes[8] No,NOK

 Norway, except:

Partial Unclear No No No No[9] No[10] No No[8][11] No,NOK

 Svalbard

Partial Unclear No No No Yes[12][citation needed] No No Yes[8][13][citation needed] No,NOK

 Bouvet Island

Partial Unclear No No No Yes[12][citation needed] No No Yes[8][13][citation needed] No,NOK

 Peter I Island

 Queen Maud Partial Unclear No No No Yes[12][citation needed] No No Yes[8][13][citation needed] No,NOK

Land

Partial Unclear No No No Yes No No Yes[14] No,CHF

 Switzerland

EU EU
Member states and Application Enforceable in local EU VAT EU customs EU single Euro-
EURATOM? citizen- elec- Schengen area?
sovereign territories of EU law courts? area? territory? market? zone?
ship? tions?
Future

The European Union (blue)

and EFTA countries (green)

The Norwegian electorate has rejected treaties of accession to the EU in two referenda. At the time of the first
referendum (1972) their neighbour Denmark joined. The second time (1994) two other Nordic
neighbours, Sweden and Finland, joined the EU. The last twogovernments of Norway have been unable and
unwilling to advance the question, as they have both been coalition governments consisting of proponents and
opponents.
Since Switzerland rejected the EEA in 1992, referenda on EU membership have been initiated, the last time in
2001. These were rejected by clear majorities.
Iceland, on the other hand, may join the EU in the near future, following the global financial crisis of 2008,
which has particularly affected the local economy. On 16 July 2009, the government formally applied for EU
membership.[5]
In mid-2005, representatives of the Faroe Islands hinted at the possibility of their territory joining EFTA.
[6]
 However, the chances of the Faroes' bid for membership are uncertain because, according to Article 56 of
the EFTA Convention, only states may become members of the Association. [7] The Faroes already have an
extensive bilateral free trade agreement with Iceland, known as the Hoyvík Agreement.
International relationships

EFTA has several free trade agreements with non-EU countries as well as declarations on cooperation and joint workgroups to improve trade. Currently, the EFTA

States have established preferential trade relations with 20 States and Territories, in addition to the 27 Member States of the European Union. [2]

Nations the EFTA has an FTA with in dark blue, negotiating an FTA with in dark cyan, has a declaration on cooperation with in purple, and is in a "joint workgroup" with in dark red; the EFTA is

light green.

Free Trade Agreement

 Canada

 Chile

 Croatia

 Egypt

 Israel (Switzerland exempt)[citation needed]

 Jordan

 South Korea

 Lebanon

 Macedonia
  Mexico

 Morocco (Excluded Western Sahara[3])

 Palestinian National Authority

 Singapore

 Southern African Customs Union (Botswana, Lesotho, Namibia, Swaziland, South Africa)

 Tunisia

 Turkey

Signed agreement 2008, not yet ratified

 Colombia

Signed agreement 2009, not yet ratified

 Gulf Co-operation Council (Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, United Arab Emirates)

Signed agreement 2010, not yet ratified

 Ukraine[4]

Finalised negotiations 2008

 Peru

Currently negotiating agreements

 Algeria

 Hong Kong

 India

 Thailand

Declarations on Cooperation
 Albania

 Mercosur (Brazil, Argentina, Uruguay, Paraguay)

 Mongolia

 Serbia

Joint workgroups
 Indonesia

 Russia

Also have a look at

http://en.wikipedia.org/wiki/European_Union
http://exim.indiamart.com/economic-survey10-11/
http://exim.indiamart.com/benefits-incentive/
http://exim.indiamart.com/act-regulations/

HIGHLIGHTS OF EXIM POLICY 2002-07

(as amended upto 31.3.2003)

1. Service Exports

Duty free import facility for service sector having a minimum foreign exchange earning of Rs.10 lakhs.
The duty free entitlement shall be 10% of the average foreign exchange earned in the preceding three licensing years. However, for hotels, the same shall be 5%
of the average foreign exchange earned in the preceding three licensing years. This entitlement can be used for import of office equipments, professional
equipments, spares and consumables. However, imports of agriculture and dairy products shall not be allowed for imports against the entitlement. The entitlement
and the goods imported against such entitlement shall be non-transferable.

2. Agro Exports
a. Corporate sector with proven credential will be encouraged to sponsor Agri Export Zone for boosting agro exports. The corporates to provide services
such as provision of pre/post harvest treatment and operations, plant protection, processing, packaging, storage and related R&D.
b. DEPB rate for selected agro products to factor in the cost of pre-production inputs such as fertiliser, pesticides and seeds.
3. Status Holders
a. Duty-free import entitlement for status holders having incremental growth of more than 25% in FOB value of exports (in free foreign exchange).

This facility shall however be available to status holders having a minimum export turnover of Rs.25 crore (in free foreign exchange). The duty free
entitlement shall be 10% of the incremental growth in exports and can be used for import of capital goods, office equipment and inputs for their own
factory or the factory of the associate/supporting manufacturer/job worker. The entitlement/ goods shall not be transferable. This facility shall be
available on the exports made from 1.4.2003.
b. Annual Advance Licence facility for status holders to be introduced to enable them to plan for their imports of raw material and components on an
annual basis and take advantage of bulk purchases.
c. The Input-Output norms for status holders to be fixed on priority basis within a period of 60 days.
d. Status holders in STPI shall be permitted free movement of professional equipments like laptop/computer.
4. Hardware/Software
a. To give a boost to electronic hardware industry, supplies of all 217 ITA-1 items from EHTP units to DTA shall qualify for fulfillment of export
obligation.
b. To promote growth of exports in embedded software, hardware shall be admissible for duty free import for testing and development purposes.
Hardware upto a value of US$ 10,000 shall be allowed to be disposed off subject to STPI certification.
c. 100% depreciation to be available over a period of 3 years to computer and computer peripherals for units in EOU/EHTP/STP/SEZ .
5. Gem & Jewellery Sector
a. Diamond & Jewellery Dollar Account for exporters dealing in purchase/sale of diamonds and diamond studded jewellery.
b. Nominated agencies to accept payment in dollars for cost of import of precious metals from EEFC account of exporter.
c. Gem & Jewellery units in SEZ and EOUs can receive precious metal i.e Gold/silver/platinum prior to exports or post exports equivalent to value of
jewellery exported. This means that they can bring export proceeds in kind against the present provision of bringing in cash only.
6. Export Clusters
a. Upgradation of infrastructure in existing clusters/industrial locations under the Department of Industrial Policy & Promotion (DIPP) scheme to increase
overall competitiveness of the export clusters.
b. Supplemental efforts to be made under the ASIDE scheme and similar schemes of other Ministries to bridge technology and productivity gaps in
identified clusters.
c. 10 such clusters with high growth potential to be reinvigorated based on a participatory approach.
7. Rehabilitation of Sick Units

For revival of sick units, extension of export obligation period to be allowed to such units based on BIFR rehabilitation schemes. This facility shall also be available
to units outside the purview of BIFR but operating under the State rehabilitation programme.
8. Removal of Quantitative Restrictions
a. Import of 69 items covering animal products, vegetables and spices, antibiotics and films removed from restricted list.
b. Export of 5 items namely paddy except basmati, cotton linters, rare earth, silk cocoons, family planning devices except condoms removed from
restricted list.
9. Special Economic Zones Scheme
 a. Sales from Domestic Tariff Area (DTA) to SEZs to be treated as export. This would now entitle domestic suppliers to Drawback/ DEPB benefits, CST
exemption and Service Tax exemption.
b. Agriculture/Horticulture processing SEZ units will now be allowed to provide inputs and equipments to contract farmers in DTA to promote production
of goods as per the requirement of importing countries. This is expected to integrate the production and processing and help in promoting SEZs
specialising in agro exports.
c. Foreign bound passengers will now be allowed to take goods from SEZs to promote trade, tourism and exports.
d. Domestic sales by SEZ units will now be exempt from SAD.
e. Restriction of one year period for remittance of export proceeds removed for SEZ units.
f. Netting of export permitted for SEZ unit provided it is between same exporter and importer over a period of 12 months.
g. SEZ units permitted to take jobwork abroad and exports goods from there only.
h. SEZ units can capitalise import payables.
i. Wastage for subcontracting/exchange by gem and jewellery units in transactions between SEZ and DTA will now be allowed.
j. Export/import of all products through post parcel/courier by SEZ units will now be allowed.
k. The value of capital goods imported by SEZ units will now be amortised uniformly over 10 years.
l. SEZ units will now be allowed to sell all products including gems and jewellery through exhibitions and duty free shops or shops set up abroad
m. Goods required for operation and maintenance of SEZ units will now be allowed duty free.
10. EOU Scheme
a. Agriculture/Horticulture processing EOUs will now be allowed to provide inputs and equipments to contract farmers in DTA to promote production of
goods as per the requirement of importing countries. This is expected to integrate the production and processing and help in promoting agro exports.
b. EOUs are now required to be only net positive foreign exchange earner and there will now be no export performance requirement.
c. Foreign bound passengers will now be allowed to take goods from EOUs to promote trade, tourism and exports.
d. The value of capital goods imported by EOUs will now be amortized uniformly over 10 years.
e. Period of utilisation of raw materials prescribed for EOUs increased from 1 year to 3 years.
f. Gems and jewellery EOUs are now being permitted sub-contracting in DTA.
g. Wastage for subcontracting/exchange by gem and jewellery units in transactions between EOUs and DTA will now be allowed as per norms.
h. Export/import of all products through post parcel/courier by EOUs will now be allowed.
i. EOUs will now be allowed to sell all products including gems and jewellery through exhibitions and duty free shops or shops set up abroad
j. Gems and jewellery EOUs will now be entitled to advance domestic sales.
11. EPCG scheme
a. The scheme shall now allow import of capital goods for pre-production and post-production facilities also.
b. The Export Obligation under the scheme shall now be linked to the duty saved and shall be 8 times the duty saved.
c. To facilitate upgradation of existing plant and machinery, import of spares shall also be allowed under the scheme.
d. To promote higher value addition in exports, the existing condition of imposing an additional Export Obligation of 50% for products in the higher
product chain to be done away with.
e. Greater flexibility for fulfillment of export obligation under the scheme by allowing export of any other product manufactured by the exporter. This shall
take care of the dynamics of international market.
f. Capital goods upto 10 years old shall also be allowed under the scheme.
g. To facilitate diversification into the software sector, existing manufacturer exporters will be allowed to fulfill export obligation arising out of import of
capital goods under the scheme for setting up of software units through export of manufactured goods of the same company.
h. Royalty payments received from abroad and testing charges received in free foreign exchange to be counted for discharge of export obligation under
EPCG scheme.
12. DEPB Scheme
a. Facility for provisional DEPB rate introduced to encourage diversification and promote export of new products.
b. DEPB rates rationalised in line with general reduction in Customs duty.
13. Advance Licence
a. Standard Input Output Norms for 403 new products notified.
b. Anti-dumping and safeguard duty exemption to advance licence for deemed exports for supplies to EOU/SEZ/EHTP/STP.
14. DFRC Scheme
a. Duty Free Replenishment Certificate scheme extended to deemed exports to provide a boost to domestic manufacturer.
b. Value addition under DFRC scheme reduced from 33% to 25%.
15. Reduction of Transaction Cost
a. High priority being accorded to the EDI implementation programme covering all major community partners in order to minimise transaction cost, time
and discretion. We are now gearing ourselves to provide on line approvals to exporters where exports have been effected from 23 EDI ports.
b. Online issuance of Importer-Exporter Code(IEC) number by linking the DGFT EDI network with the Income Tax PAN database is under progress.
c. Applications filed electronically (through website www.nic.in/eximpol) shall have a 50% lower processing fee as compared to manual applications.
16. Miscellaneous
a. Actual user condition for import of second hand capital goods upto 10 years old dispensed with.
b. Reduction in penal interest rate from 24% to 15% for all old cases of default under Exim Policy.
c. Restriction on export of warranty spares removed.
d. IEC holder to furnish online return of imports/exports made on yearly basis.
e. Export of free of cost goods for export promotion @ 2% of average annual exports in preceding three years subject to ceiling of Rs.5 lakh permitted

http://exim.indiamart.com/indian-exim-policy/exim-policy-2003-highlights.html

Union Budget 2011-12

 AC restaurants serving liquor and AC hospitals with more than 25 beds under service tax.
 Service tax on air travel to be increased.
 Customs duty on raw silk reduced from 30 to 5 per cent.
 Legal services to be expanded to business entities.
 20% export duty for iron ore.
 Custom duty on Pet Coke and Gypsum to minimized to 2.5%.
 No new tax exemption limit for women.
 Mandatory levy of 10 pct on branded garments.
 Budget estimates for 2011-12 projects- Rs 9,32,440 crore.
 No change in Central excise duty rate. Base rate on excise duty raised from 4% to 5%.
 Surcharge rate reduced from 7.5 percent to 5 percent for domestic companies.
 Hike in exemption IT limit from Rs 1.6 lakh to Rs 1.8 lakh.
 New series of coins with new rupee symbol expected.
 Simplify tax collection procedure.
 1 million UID cards to be distributed per day shortly.
 Targeting to reduce deficit to 4.6% for the upcoming fiscal year.
 Plan and Non-Plan expenditure to be increased by 23%.
 BPL pension eligibility age limit reduced.
 Group formed to monitor corruption;will start implementing from 62 dept. in first phase.
 Amendment of Indian Stamp Act shortly.
 Simplified form 'Sugam' for small tax payers.
 Rs 1.64 lakh crore for Defence.
 Rs 1000 crore to build judicial infrastructure.
 Group of ministers to sort out Environmental concerns.
 1000 crore for improvising judiciary system.
 Rs 8,000 cr to Northeast.
 60 schemes for SC/ST to be implemented.
 Rs 100 crore for Ladakh.
 Rs 150 crore for Jammu.
 Pension amount increased for 80 years and above.
 Indira Gandhi National Old Age Pension Scheme eligibility revised from 65 to 60 years.
 Rs 200 cr grant to IIT Kharagpur.
 Rs 20 crore to IIM Calcutta.
 50 Crore to muslim universities in different states.
 58,000 crore for Bharat Nirman Schemes: FM
 State Innovation Council in each state to be set up.
 Remuneration of anganwadi workers increased from Rs 1500 to Rs 3,000 per month.
 Independent debt management office to be established.
 Rs 1.6 lakh crore to be spent on social projects.
 Current a/c gap a concern due to composition of FX flows: FM
 Establishment of national policy on psychotic drugs, narcotics.
 Tax free infra bonds worth Rs 30000 cr for PSBs proposed.
 15 mega food parks to be set up.
 Infrastructure spending increased by 23%.
 Rs 30K crore tax free bonds to be provided for railways.
 Financial assistance to be provide to Bengaluru, Chennai, Kolkata metro projects.
 Allocation under Rashtriya Krishi Vikas Yojana to be increased to Rs 7860 crore.
 Promote organic farming.
 GDP manufacturing, targeting 16-25 % increase in next 10 years.
 Rs 300 cr to cultivate pulses in rain-fed areas;Rs 300 cr for the promotion of farm product cultivation.
 Provide Rs 6000cr for PSU bank recapitalization.
 FM: Micro finance companies to be provided with Rs 100 crore equity funds.
 Extension of NBS for urea to be analyzed.
 Home loan limit increased.
 Rs 300 cr for improving pulses production.
 Rural infrastructure development fund to be raised to 180 billion Rupees for the coming fiscal year.
 Grant 1% interest on home loans upto 50 lakhs.
 Mortage Risk Guarantee fund for rural housing to be set up.
 Rs 5,000 cr to be provided to SIDBI to meet priority lending targets.
 Rs 2000 crore for warehousing facilities.
 Rs 2,000 cr for manufacturing facilities.
 Allocation of Rs 6000 cr for some PSU banks.
 Only registered FII's to be associated with Indian MF industry.
 Rs 40,000cr to be raised via disinvestment.
 GST bill to be introduced in current session.
 Extension of NBS to cover urea under review: FM
 500 crore proposed for empowering women.
 Micro finance institutes proposed for 100 crore.
 300 crore to be provided to NABARD.
 FBI to regularize banking amendments.
 Ensures better delivery of urea, kerosene.
 FII allow to trade amongst themselves.
 FBI policy to be regularized.
 Public Debt Management Bill to be introduced in 2012.
 Pranab sees Budget 2011-12 as transition towards a transparent and result-oriented economic management.
 Public sector undertaking to be increased.
 Direct transfer of cash subsidy to downtrodden.
 Average inflation and current account deficit to be minimized by next year: FM
 Strong proposition to fight against corruption.
 Pranab seeking Lord Indra's blessings to get good monsoon.
 Remarkable record for last fiscal year.
 Improvise the governance.
 Govt. to reconsider ecological concerns.
 Tremendous growth in exports-29.4%.
 Food inflation down from 22.2% to 9.3 %. But still is a major concern, says FM.
 Budget to ensure more transparent economy.
 Focus on supply side issues in agriculture.
 Pranab: Work on food inflation.
 Stabilize the macro economic situation.
 Budget 2011 approved by Cabinet.
 Pranab: Impressive fiscal consolidation
 Pranab Mukherjee begins the speech.
 Finance Minister Pranab Mukherjee to begin Union budget 2011-12 speech from 11 am.

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