import &am export in india

IMPORT & EXPORT IN INDIA

INDEX

Export- An Overview Sea Ports Export Policy In India What To Export? Export Charges & Requirements Import- An Overview Import Policy In India What To Import? Regulations & Procedures for Import Import Restrictions

EXPORT- AN OVERVIEW

In Economics: Trading something out of the country. An EXPORT is any good or commodity,

transported from one country to another country in a legitimate fashion, typically for use in trade.

Export goods or services are provided to foreign consumers by domestic producers.

EXPORT- AN OVERVIEWAdvantages Of Exporting Requires significantly lower level of investment

than other modes of international expansion. Lower level of Investment implies lower risk. Allows managers to exercise operation control. Disadvantages Of Exporting Customer Demand: Demand of additional services

such as installation and startup of equipment, maintenance.

Improved Communication technologies: Availability of cheaper communication option has led to higher degree of interaction between customer & vendor leading to more transparency.

Management mistakes: Poor selection of overseas agents or distributors by the management.

EXPORT- AN OVERVIEW

Ways Of ExportingDirect Through Distributors Through Foreign Retailers & End Users Over the InternetIndirect Selling goods to or through an independent domestic

intermediary in the same country. Then intermediaries export the products to foreign

markets.

SEA PORTS

MUNDRA AND KANDLA

NHAVA SHEVA & MUMBAI

CHENNAI

KOLKATTA

TUTICORIN

COCHIN

MARMGAO

EXPORT POLICY IN INDIA

Most items can be freely exported from India. A few items are subject to export control in order to

: Avoid shortages in the domestic market. Conserve national resources. Protect the environment. Export profits are exempt from income tax. Higher royalty payments of 8% (net of taxes) are

permitted on export sales as compared to 5% on domestic sales.

EXPORT POLICY IN INDIA(CONTD..)

Export commissions up to 10% are also permissible. Inputs required to be imported for export

production are exempted from the basic customs duty.

Export Oriented Units (EOUs) and Export Processing Zones (EPZs) enjoy special incentives such as:

Duty Free import of capital goods for the purpose of export production.

Duty Free import of raw materials for the purpose of export production.

WHAT TO EXPORT?

Major Commodity Groups are: Agriculture & Allied Ores & Minerals Manufactured Goods Crude & petroleum products Others & unclassified items

WHAT TO EXPORT?(CONTD..)

India’s Export of Principal Commodities Composition of India’s Export (In %)

WHAT TO EXPORT?(CONTD..)

WHERE TO EXPORT?

Major Countries involved are: U.K Germany U.S.A Japan Russia OPEC

WHERE TO EXPORT?(CONTD..)Direction Of India’s Foreign Trade Country wise percentage share

EXPORT CHARGES & REQUIREMENTS A limited number of items, mostly primary

commodities or processed agricultural products, are subject to duties.

Currently, the only products subject to an export tax (@10%) are goat, sheep and bovine leathers.

Products may also be subject to a minimum export price.

It Includes products like: Basmati & Non-Basmati Rice, cotton and hard and soft cotton waste.

The time limit for settlement of export proceeds, that is, the amount representing the full export value of the goods, is six months.

A maximum of 15 months is allowed for exports to Indian-owned warehouses abroad.

EXPORT CHARGES & REQUIREMENTS(CONTD..)

The following documents are required for exports: GATT GR form Export License Export Declaration Customs Invoice Certificate Of Origin Bill of lading/Air waybill Packing List

PROHIBITED LIST OF EXPORT FOR INDIA

There are 10 entries in the Prohibited List, export of which is not permitted on religious and environmental considerations.

All forms of wild life including their parts and products except Peacock Tail Feathers

Exotic birds Wild orchids Beef Human Skeletons Tallow, fat and/or oils of any animal origin excluding

fish oil

PROHIBITED LIST OF EXPORT FOR INDIA(CONTD..)

Wood and wood products Chemicals included in Schedule 1 of the

Chemicals Weapons Convention of the United Nations.

Sandalwood in any form, but excluding fully finished handicrafts made out of sandalwood and machine finished sandalwood products

Red Sanders wood in any form

IMPORT- AN OVERVIEW

In Economics: Import : It is a good that is brought in from another

country for sale. An import is any good (e.g. a commodity) or

service brought in from one country to another country in a legitimate fashion, typically for use in trade.

An import in the receiving country is an export to the sending country.

IMPORT- AN OVERVIEW

Balance Of Trade Represents a difference in value for import and

export for a country. A country has demand for an import when: Domestic quantity demanded exceeds domestic

quantity supplied. Price of the good (or service) on the world market

is less than the price on the domestic market. The balance of trade, denoted NX, is the difference

between the value of the goods (and services) a country exports and the value of the goods the country imports:

NX = X − I , X->Export, I->Import

IMPORT POLICY IN INDIA

Import policy has 3 major objectives:1) To make necessary imported goods more easily available, including essential capital goods for modernizing and upgrading technology.2) To simplify and streamline procedures for import licensing.3) To promote efficient import substitution and self-reliance.

Imports are allowed free of duty for export production under a duty exemption scheme.

Duty Exemption Scheme have been specified for more than 4200 items.

IMPORT POLICY IN INDIA(CONTD..)

There are no quantitative restrictions on imports of capital goods and intermediates.

Import of second-hand capital goods is permitted provided they have a minimum residual life of 5 years.

There is an Export Promotion Capital Goods (EPCG) Scheme under which:

Exporters are allowed to import capital goods (including computer systems) at concessionary customs duty.

Service industries enjoy the facility of zero import duty.

WHAT TO IMPORT? India’s Import of Principal Commodities

WHERE TO IMPORT?

Major Countries involved are: U.K Germany U.S.A Japan Russia OPEC

WHERE TO IMPORT?(CONTD..)Direction Of India’s Import Country wise percentage share

REGULATIONS & PROCEDURES FOR IMPORT

All imports fall into one of the following four categories:

Freely Importable Items Licensed Imports Canalized Items Prohibited Items

REGULATIONS & PROCEDURES(CONTD..)

Freely Importable Items Most capital goods (Goods under EPCG) falls in this

category. Items in this category require import licenses of

EPCG and DEEP. Has to be imported by individual having LicenseLicensed Imports Imported only with licenses and only by actual users. Negative List: Precious and Semi-precious stones, products related

to safety and security, seeds, plants and animals, some insecticides, pharmaceuticals and chemicals, some electronic items, several items reserved for production by the small-scale sector, and 17 miscellaneous or special-category items.

REGULATIONS & PROCEDURES(CONTD..)

Canalized Items Can be imported only by specified public-sector

agencies These includes: Petroleum Products (By the Indian Oil Corporation) Nitrogenous phosphatic, potassic and complex

chemical fertilizers (By Minerals and Metals Trading Corporation).

Vitamin- A drugs (By the State Trading Corporation). Oils and seeds (By the State Trading Corporation

and Hindustan Vegetable Oils). Cereals (By the Food Corporation of India).

REGULATIONS & PROCEDURES(CONTD..)

Prohibited List Completely banned from importation Only 3 items in this category: Tallow fat, animal rennet and unprocessed ivory.

IMPORT RESTRICTIONS

Licensing, Quotas & Prohibitions Based on licensing the importers are divided into 3

categories: Actual Users Registered Exporters Others

Licenses are valid for: 24 months for capital goods. 18 months for raw materials components,

consumable and spares, with the license term renewable.

IMPACT OF RECESSION

India's Forex reserves USD 271.641 billion. Exports for October 2008 contracted by 15% on a

year-on-year basis. Growth contraction has come after a robust 25%-plus

average export growth since 2003. Positive correlation between growth in exports

and the country’s GDP. A decelerating export growth has implications for

India, even though our economy is far more domestically driven than those of the east Asia. Still, the contribution of merchandise exports to GDP has risen steadily over the past six years — from about 10% of GDP in 2002-03, to nearly 17% by 2007-08.

IMPACT OF RECESSION(CONTD..)

A sharp fall in export growth has led to losses of job.

For instance, the Manufacturing Sector(especially the garment industry) has suffered approx. 10 million job losses.

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