Practical Compliance - Skilling & Mentorship Obligation under FTP 2023 (Star Export House)

[Abhijeet Mane]

As per FTP 2023, Star Export Houses have a skilling & mentorship obligation. Practically, is the Company currently complying with this ? If yes, what is the accepted mode of compliance and documentation? Inputs on practical compliance would be helpful.

[YAGAY andSUN]

Under Para 1.30 of the Foreign Trade Policy 2023, Status Holders (including Star Export Houses) are required to undertake a skilling and mentorship obligation, aimed at capacity building of new and potential exporters. The provision is couched in enabling terms, granting flexibility in implementation, while embodying a mandatory policy expectation.

In practical terms, compliance is presently evolving and not subject to strict regulatory enforcement or audit. There is no prescribed statutory return, certification mechanism, or direct consequence presently linked to non-fulfilment. Accordingly, industry practice reflects a bona fide, demonstrative compliance approach, rather than rigid adherence to a standardized format.

Status Holders are generally discharging the obligation through internally structured or collaborative training initiatives, including in-house training programmes, workshops in association with Export Promotion Councils or trade bodies, online or hybrid modules, and mentorship of new IEC holders. The policy expressly permits discretion in designing curriculum, trainee selection, and delivery mechanism, thereby validating such varied modes of compliance.

From a documentation standpoint, although no format is prescribed, prudent practice requires maintaining contemporaneous evidentiary records. These typically include programme outlines, trainee details, attendance records, training materials, feedback forms, and proof of conduct (including virtual session records). Such documentation serves to substantiate compliance in the event of regulatory scrutiny.

In sum, the obligation presently operates in a principle-based compliance framework, where substantive adherence and demonstrable effort suffice. While immediate penal implications are absent, maintaining reasonable documentation and undertaking genuine skilling initiatives is advisable, particularly in view of potential future linkage with Status Holder benefits or policy enforcement mechanisms.

AI Summary

Skilling and mentorship obligation under Foreign Trade Policy 2023 requires flexible, documented compliance by Status Holders. Status Holders, including Star Export Houses, have a skilling and mentorship obligation under the Foreign Trade Policy 2023 for capacity building of new and potential exporters. The obligation is presently compliance-based rather than enforcement-driven, with no prescribed return, certification mechanism, or immediate consequence for non-fulfilment. Compliance may be demonstrated through training programmes, workshops, online or hybrid modules, and mentorship activities, supported by contemporaneous records such as outlines, attendance, materials, feedback forms, and proof of conduct.