1. GENERAL INTRODUCTION

2. OBJECTIVES OF THE STUDY

3. INDUSTRY PROFILE

4. COMPANY PROFILE

5. DOCUMENTATION OF IMPORT AND EXPORT OF ROMSONS

6. PRODUCTS AND SERVICES

7. EXPORT POLICY

8. RESEARCH METHODOLOGY

9. DATA ANALYSIS AND INTERPRETATION

10. SUGGESTION

11. CONCLUSION

12. BIBLIOGRAPHY

1

EXECUTIVE SUMMARY

As part of our curriculum, I did my research project on study of“foreign

trade documentation in Romsons. This analysis has given me great

insight to the behavior and attitude of people at work. To understand

their needs & aspirations at work I conducted a survey & analyzed to

have a platform to work on. You will have a view to it in the project.

Never did it occur to me before doing this study.

“foreign trade documentation in Romsons Scientific & Surgical Industries

AT AGRA” is the topic of my project.

I selected Romsons Scientific & Surgical Industries, AGRA as the

organizations under study. Romsons Scientific & Surgical Industries AT

AGRA in terms of profits, assets, & employees. It offers a wide range of

scientific and surgical products corporate & retail customers through

delivery channels & through its specialized subsidiaries.

I am hopeful that anybody, who reads my project, will enjoy it as much

as I enjoyed doing it.

2

Company Profile

A pioneer and a leaderOne of free India’s earliest, most critical revolutions took place in 1952 in the field of

healthcare.

At a time when most patients were vulnerable and many succumbed to infection

caused by re-usable medical devices, Romsons stepped forward with a pioneering

breakthrough – the concept of disposable medical and surgical devices.

Today, over half a century later, the culture of disposable medical devices is well

established and Romsons has entrenched itself as the pre-eminent brand in the

business –a pioneer and a leader. An INR 1.80 billion, professionally-managed

enterprise. A global player with a presence in 65 countries. A product portfolio that’s

100 products strong. A retail footprint across geographies – with a 810-plus

distributor network in India and abroad. Most significantly, the name Romsons

continues to inspire trust – for unsurpassed quality, innovation and safety of its

products.

 Romsons Group of Companies

Romsons International, Agra, India

 

Romsons International (Unit-II), Noida, India

 

Romsons Scientific & Surgical Industries Pvt. Ltd.

 

Romsons Juniors India

 

Romsons Medicons 

 

Raj Vijay Corporation

 

3

A product for every need? Well, almost

We have the largest product portfolio in the industry (100 products in over 600

sizes), which caters to almost the entire spectrum of patients need. Designed and

manufactured to deliver maximum performance and safety, Romsons is the last word

in quality. This has earned us the recognition of our peers in the industry. Be it an

award from the Chamber of Commerce in India for outstanding export performance

or the special recognition instituted by MSME, Government of India, our pioneering

work has been universally appreciated.

Winning the trust of the best in the world

What has earned us the loyalty of the most demanding customers in the world?

What gives us the edge to deliver greater value to customers? Firstly, our experience

(over 50 years) in understanding a patient’s needs and a doctor’s requirements.

Secondly, our first-hand knowledge of designing and developing products. Thirdly,

the unquestioned integrity of our products. But most importantly, our ability to serve

the emerging needs of our customers with speed and agility.

Little surprise that, Romsons products are being exported to developed and

emerging markets in over 65 countries. We also regularly participate in international

industry trade fairs like Medica (Germany), Hospimedica (Singapore), Arab Health

(UAE), FIME (USA) amongst others.

R&D – the driving force

Our mission is to create products that promote healing, well-being and safety of

patients. To realize this objective, we have an active, cutting-edge research and

development programme – the driving force behind the ingenuity and reliability of our

products. The quality of our R&D infrastructure is matched by the quality of our

research professionals – and in both respects, we are second to none.

Our R&D, marketing and production teams work closely with customers to

continuously improve existing products and research new solutions in light of

changing customer needs and market dynamics. This capability – our core

4

competence – has given us a distinct edge and kept us a step ahead of our peers for

over 50 years.

Good Manufacturing Practices (GMP)

Our manufacturing plant conforms to GMP, a WHO proprietary benchmark. The

discipline of this standard is evident in the physical ambience of our plant, the air and

water quality, manufacturing technology, packaging and the sterilization process.

Ambience: Special micro and HEPA filters at all air handling units ensure minimal

contamination in the manufacturing areas. Micro-organism and particle concentration

levels are carefully monitored by the micro-biological labs to keep these levels within

safe limits. Employees undergo periodic medical checkup to maintain high standards

of health and hygiene. All clean rooms are provided with three step change rooms

and air showers at the entrance to ensure a dust-free environment.

Manufacturing plant: We have taken great care to source up-to-the-minute, frontline

technology. The result? We are able to produce moulding and extrusion of

components and tubings with precision and within close tolerance. The superior

assembly and packaging machines ensure repeatability and consistency in product

quality.

Packaging and sterilization: Our products are packed to ensure minimal risk of

contamination or damage during transportation. We use Ethylene Oxide gas to

sterilize the products, as per EN 550/ISO 11135 standards. The entire process is

automated and computerized. Each batch is well documented for the sterilization

cycle and released for dispatch after written approval of a senior Quality Assurance

official.

Towards zero-defect quality

We are a Total Quality corporation, whose overarching goal is to manufacture zero-

defect products. That’s why, we have meticulously planned and built a series of

5

multiple online and manual quality control measures into each stage of raw material

procurement, manufacturing and packing cycle. Our Quality Control standards

conform to ISO 9001:2000, ISO 13485:2003 and the European Medical Device

Directive 93/43/EEC certifications. As a result, we have been authorized to label our

products with the prestigious CE mark – a testimony of the world-class quality of our

products.

Empowering people to excel

We provide a professional work environment that nurtures the pioneering spirit and

leadership qualities of our employees. Our employees are encouraged to be self-

motivated, think out-of-the-box, value excellence and bond with each other as

committed team players. All across our corporation, our teams function with the

flexibility, speed and decisiveness of people in any global corporation. In the final

analysis, it is our people who have made Romsons what it is today: a pioneer and a

leader.

OFFICE & WORKS:

ROMSONS INTERNATIONAL62 Industrial EstateNunhai, Agra-282006India

ROMSONS INTERNATIONAL Unit-II59J(C) Noida Special Economic Zone,Noida Dadri Road, Phase-IINoida-201305 (U.P.) India CORPORATE OFFICE:

4/1 East Patel NagarNew Delhi-110008India

 Communication

6

Tel: +91 - 562 2280720, 2280730Fax: +91 - 562 2280700, 2280600

Email: romsons@romsons.com

Our Mission

To make a mark in our chosen area, by being ever

abreast of new possibilities. To anticipate the needs of

our customers and end users and to translate their

requirements into meaningful products. To create,

innovate and produce excellence through a philosophy

of uncompromising dedication at every level of function. To nurture a lasting

relationship with our distributors- our partners in growth, through empathic

understanding and mutual respect. To leverage our human resources by

recognizing and rewarding talent, to create an ethos of perfectionism.

Winning the trust of the best in world

What has earned us the loyalty of the most demanding customers in the

world? What gives us the edge to deliver greater value to customers? Firstly,

our experience (over 50 years) in understanding a patient’s needs and a

doctor’s requirements. Secondly, our first-hand knowledge of designing and

developing products. Thirdly, the unquestioned integrity of our products. But

most importantly, our ability to serve the emerging needs of our customers

with speed and agility. Little surprise that Romsons products are being

exported to developed and emerging markets in over 65 countries.

A product for every need? Well, almost

We have the largest product portfolio in the industry (100 products in over 600

sizes), which caters to almost the entire spectrum of patient need. Designed

and manufactured to deliver maximum performance and safety, Romsons is

the last word in quality. Most significantly, the name Romsons continues to

7

inspire trust - for unsurpassed quality, innovation & safety of its products.

8

The objective of the study during this research project was as follows-

To study the foreign trade documentation and procedure in the organizations.

To study the organization growth through foreign trade.

To study the Export Market of Romsons, Agra in Different Countries.

To study the Exim Policy Romsons

To study the Export Strategies in Footwear Industry

To study the Foreign Trade Policy

To study the better Growth prospective of the industry through

Export.

9

The method adopted for carrying out any project is called as Research

methodology. Research methodology used in this project is based on

following factors :

Sources of data – Primary (questionnaire) and secondary data

(information regarding both organizations through internet &

booklets).

Data collection method & techniques – Questionnaire and

interviews.

Sampling plan –

Target population – Finance Export – Import Section Officials of

Dawar Footwear, Agra.

Sampling method – Random sampling.

Sample size – 50

Area of population – Dawar Footwear Agra.

RESEARCH DESIGN10

Research design specifies the methods and procedures for

conducting a particular study. A Research design is the arrangement of

conditions for collection and analysis of the data in a manner that aims to

combine relevance to the research purpose with economy in procedure.

Research Design is broadly classified into three types as

Exploratory Research Design

Descriptive Research Design

Hypothesis testing Research Design

On the basis of the objective of study, the study which is concerned

with describing the characteristics of a particular individual or of group of

individual under study comes under Descriptive Research design.

Descriptive Research Design:-

In this research design the objective of study is clearly defined and

has accurate method of measurement with a clear-cut definition of

population that is to be studied.

RESEARCH DESIGN AND METHODOLOGY

Research methodology is a systematic way, which consists of series of

actions or steps necessary to effectively carry out research and the

desired sequencing of these steps. The research is a process of involves a

number of interrelated activities, which overlap and do rigidly follow a

particular sequence. It consists of the following steps

11

Formulating the objective of the study

Designing the methods of data collection

Selecting the sample plan

Collecting the data

Processing and analyzing the data

Reporting the findings

Foreign Trade: An Analysis

Post Liberalization Exim Policy (1991-01)

India’s Export Performance in the post liberalisation

period i.e., 1991-2001 has been much better than the

pre-reform period. From a level of (–) 1.5% growth rate 12

Objective of Study

Reporting of Findings

Data Analysis

Data Collection

Sample Design

Research Design

during 1991-92 the value of exports in dollar terms

witnessed a growth rate of 21% in 2000-01.

Consequently, India’s share in world exports increased

from 0.41% in 1992-93 to 0.67% in 2000-01. In terms of

openness of Indian economy, that is trade measured as

percentage of value of GDP, the degree of openness,

has almost doubled from a level of 13% in 1990-91 to

22% in 2000-01. The highest export growth rate for the

decade was achieved in 2000-01 at 21%. Such a

commendable performance on the export front could

be attributed to the favourable international economic

environment, the domestic reforms undertaken during

the last few years and the responsiveness of the

exporters to the market trends.

A compositional change has been witnessed in the

export basket of India with the opening up of the

economy. During the last 10 years there has been a

significant shift in the composition of the export

basket . The share of manufactured goods in total 13

export of India has increased from 76% in 1991-92 to

83% in 2000-2001. Chemicals & related products,

Engineering goods, Electronic goods, Gems & jewellery,

Marine products and Textiles have witnessed steady

export growth, barring some inter year variations,

during the period. The growth rates of Agricultural &

allied products and Leather & manufactures have

lagged behind during the last 10 years. The export

growth rates of items within the manufactured goods

groups have shown an increasing trend throughout the

decade and include items like Gems & Jewellery,

Manufactures of Metals, Drugs, Pharmaceuticals &

Chemicals and Textiles.

Another important sector is that of Petroleum

products export in which the share has risen from a

level of 2.58% to 4.10%. Destination-wise, the share of

India’s exports to Asia & Oceania region has improved

significantly over the decade from 30% in 1990-91 to

37.48% in 2000-01. Similarly, North America’s share 14

has increased substantially from 16% to 24.73% and

Africa’s share has more than doubled from 2.61% to

5.3%. However, the West European region has slipped

from its top position as India’s main export destination

to the second position with its share falling from

33.64% in 1990-91 to 27.7% in 2000-01.

Another important trading partner of India whose

share has fallen substantially is that of East European

region. India’s exports to this region have declined from

a level of 17.87% in 1990-91 to 2.95% at the end of the

decade. In terms of growth performance, high growth

rates have been recorded in the case of Asia &

Oceania, Africa, America and Latin American Countries

(LAC). Low growth rates have been seen in our exports

to West Europe and East Europe.

Country-wise, share of Hong Kong in India’s total

exports has shown an increase from 3.29% to 5.94% in

the decade.The share of India’s exports to China to the

15

total has also increased from 0.10% to 1.87%. Other

countries to which India’s exports during the last

decade have increased are Bangladesh, Sri Lanka,

Indonesia and Malaysia. The countries that have

declined in importance in this region are Japan,

Australia and Singapore. Among countries other than

ESCAP region in Asia & Oceania, the share of India’s

exports to UAE has more than doubled. The substantial

fall in the share of Western Europe can be attributed to

decline in the share of India’s exports to Germany, U.K.,

Italy, Belgium, Switzerland and Finland. The East

European story is largely explained by the fall in the

share of India’s exports to CIS countries.

Review of Past Export Strategies

In the past, the Ministry of Commerce had

formulated several export strategies that identified

growth markets and products. The essential

16

assumption behind such strategies is that since

resources are limited, concentration on selected

products and market segments would provide better

return in terms of incremental export expansion

compared to the strategy where the limited resources

are distributed thinly over a large spectrum of products

and markets.

The Extreme Focus Product Strategy was

introduced in 1992 with the objective of giving a

focussed attention to products that have high

production capacity in India and potential for export

competitiveness. The target for the Focus Products was

to induce growth of 30% volume/value in the medium

term and stabilise growth in the subsequent period. The

success of this strategy has been mixed.

The 15X15 Matrix Strategy was first launched in

the year 1995. The objective of this strategy was to

identify market diversification and commodity

17

diversification. An examination of the effectiveness of

the strategy shows that the share of the total top 15

product groups exported to the top 15 market

destinations declinesd from 71% in 1996-97 to 66% in

2000-01 in respect of the total export of these 15

product groups for all destinations taken together.

There has thus been a market derivsification for these

product groups. The top three items of India’s exports

contained in the Matrix continue to remain the same

during 2000 - 01 i.e. Gems and Jewellery, RMG Cotton

including accessories and Cotton Yarn, Fabrics and

Made Ups. The top three destinations changed from US,

UK and Japan to US, Hong Kong and UAE.The ranking of

other countries has also changed. These developments

need to be factored into the new strategy.

Focus LAC was another strategy launched in 1997

with the objective of boosting exports of select items

like Textiles including RMG, Engineering goods and

Chemical products to Latin American Region. The 18

highest ever growth rate of exports to this region was

achieved in the year 2000-01 when the value of exports

touched an all time high of US$ 982 million. Although

the current volume of trade between LAC and India is

still low, there is scope for enhancing two-way trade

between India and the LAC region. It is obvious that the

overall export strategy must include regional focus

wherever potentialities are identified.

The main lesson that we learn from the export

strategies of the last decade is that the composition,

competitiveness and complexion of world merchandise

trade are changing very fast and a dynamic approach

with a built in institutional mechanism for constant

review is essential for any medium term export

strategy in order to achieve a higher share of global

exports on a sustainable basis. The focus of the past

strategies was on the existing export products of India;

what is additionally necessary is to review the import

baskets of our current and potential markets and also 19

to examine our export competitiveness, both revealed

and real based on our potentialities.

While the overall medium term strategy would have

to be necessarily evolved on the basis of the

perspective of a longer time frame, there would also be

need for short term response to unforeseen situations

like the slowdown in world economy witnessed from the

begining of 2001 and aggravated by the September 11,

2001 event.

In the past, the export strategies had basically

concentrated on existing products and existing markets

of India’s export sector. What is additionally necessary,

and what has been addressed in the present strategy

document, is identification of export opportunities after

examining the import basket of major importing

economies of the world and identifying potential items

of exports in which India is competitive vis-à-vis some

of the major exporting countries of these products at

20

present. The existing products and markets have also

been analysed. Focus markets have further been

identified based on different criteria. Another

additionally in the current document is that some of the

key strategic policy issues that have a bearing on

India’s competitive advantage in opportunity areas

have been brought in one place so that policy

measures that are necessary to enhance the

competitive edge of our exporting community gets

appropriate focus. Sector-wise strategies have also

been examined. The strategy document further fully

takes into account the international developments and

the complexities arising in the New World Trade Order

under the WTO.

SECTOR-WISE STRATEGIES

For the identified potential sectors, indicative sector-

wise strategies have been given based on

21

the detailed strategy paper prepared by the Export

Promotion Councils/Commodity Boards and detailed

discussions held with exporters. The main sectors

covered are the following:

Engineering (including instruments and items of

repairs), Textiles, Gems & Jewellery, Chemicals & Allied,

Agriculture, and Allied (including Marine and

Plantations), Leather & Footwear items and Other

items.

These strategies need to be operationalised by

Government for achieving the maximum results.Some

of the major strategies suggested for the different

sectors are as follows:

Engineering/Electronic/Electrical and allied

The strategies for this sector include support for

SMEs to modernise, accreditation of testing laboratories 22

in India by overseas agencies, R&D, other measures to

effectively counter NTBs in the form of TBT conditions,

furthering joint ventures, brand promotion, support to

industry to fight anti-dumping cases, providing

warehousing facilities in overseas markets, exploring

possibilities of promoting exports of Indian made

economy vehicles in developing countries and middle

and low income groups in developed countries,

promoting export of automobiles with the help of FDI,

MRAs with respect to recognition of testing agencies

and infrastructural and logistic support for automobiles

exports, a three pronged export marketing strategy for

automobile component exports (i) export through

Original Equipment Manufacturers(OEMs) for their

global sourcing requirements, (ii) export to tier 1

manufacturers as a part of their international supply

chain and (iii) direct export to after-market, focussing

on auto sector in some SEZs and automobile

component centres, setting up construction equipment 23

banks and adoption of consortium approach by Indian

construction companies to increase project exports, the

3 key mantras to promote electronics hardware,

namely (i) hardware-software combination, (ii)

integrating local and export production and (iii)

massive investments. We need to make all out efforts

to develop India as an off-shore production centre for

electronic components/equipments required for MNCs

through clusterisation, low-duties, and combine all this

with an appropriate thrust on service exports.

Textiles sector

The main strategies for this sector include

increased investment in key areas, infrastructure

development by setting up ‘Apparel Parks’ and Textiles

Centres Infrastructure Development Schemes,

restructuring EPCs, Brand Promotion and market

assistance schemes, restructuring

labour laws and smoothening existing schemes.

24

Gems & jewellery

The main strategies for this sector include forging

strategic alliances with producers of roughs and

retailers of jewellery and efforts to make India a

grading/trading centre for processed diamonds, forward

integration into gem stone jewellery, moving towards

exports of jewellery, etc.

Chemicals and allied sector

The main strategies for this sector include setting

up of Comprehensive Chemicals Estates(CCEs),

enhancing awareness of Indian herbal items, focussing

on branded generic pharmaceutical products out of

patent regime, promoting exports of cement by

lowering input costs like import duties, customs

examination charges by railways, state levies, freight

rates by railways etc.

Agriculture & allied sector

The main strategies for this sector include

25

establishing Agri.Export Zones, establishing a supply

chain management and export certification programme

for basmati rice, setting up a nodal SPS point in the

Department of Commerce, cold chain system and

innovative packaging for floriculture exports,

packhouses/value added centres for mangoes, market

oriented approach for tea and shift in focus from bulk

tea exports to value-added packaged tea exports, focus

on export of value added forms of natural rubber and

export of rubber wood, judicious mix of strategy

relating to export of Arabica coffee vis-à-vis Robusta

depending on market preference, promoting tobacco

exports by production of quality tobacco of FCV and

Burley types, pursuing with USA for higher TRQ (Tariff

Rate Quota) allocations and promoting exports to

Japan, China, Russia, Tunisia, Morocco, etc. through

bilateral negotiations, construction of drying yards and

promoting exports of value added kernels in consumer

packs, promoting exports of value added and organic 26

spices and determining minimum residue level for

pesticide residues in the case of spices, promoting use

of better handling techniques on fishing vessels and

adoption of food safety and quality systems in the case

of marine exports, utilisation of under-exploited

commercially important varieties in the case of capture

shrimps and logo schemes for marketing marine

products.

ANALYSIS OF FOREIGN POLICY 1997-2002

NDA REGIME

27

Highlights of Exim Policy

The new 5-year Export and Import policy for the period

1997-2002 aims at giving a major thrust to acceleration

of India's exports through restructuring and revamping

of various export promotion schemes and wide ranging

measures for simplification of procedures with a view to

making them more transparent and easy to administer.

Gems & Jewellery Scheme To promote export of gold

jewellery, it is proposed to increase the number of

nominated agencies permitted to stock gold. At present

only HHEC, SBI, MMTC and STC are doing this. This

improvement will make available adequate quantity of

gold to exporters on replenishment basis or on outright

purchase.

Moreover, the EOU/EPZ units are being permitted to sell

10% of their output in the DTA against SIL on payment

of duty. Duty Exemption Scheme Significant changes

have been made to reduce the multiplicity of schemes,

28

improve their attractiveness and to make them simple

and easy to administer. The quantity based advance

license has been continued.

It has restructured various export promotion schemes

and has replaced Value Based Advance License and the

Passbook Scheme by a new scheme called Duty

Entitlement Passbook Scheme. Under this scheme, an

exporter, on the basis of notified entitlement rates, will

be granted duty credits which will allow them to import

inputs duty free. He can make use of this to import any

free importable item. The credit can be transferred to

another person but the transfer will be valid within the

same port.

Under the Advance Licensing Scheme, the procedure

has been further simplified. The Export Obligation

period of 12 months has now been extended to 18

months. Further extension for 6 months will be granted

on payment of 1% of the value of unfulfilled exports.

29

This will reduce considerable paper work and

harassment to the exporter.

Software Software units can undertake exports using a

data communication link or in the form of physical

exports through a courier service also. They will be

permitted on-line data communication for DTA sales,

use of the computer system for commercial training

and import of goods on loan from clients for a specified

period.

Agro Sector Import of equipment of Rs 5 crores and

above under the Zero Duty EPCG Scheme will be

permitted for this sector.

Double weightage will be given to agro exports in

calculating the eligibility of Export Houses, Trading

Houses, etc. An additional 1% Special Import License on

the total value of exports will be given for export of

fruits, vegetables, floriculture and horticulture products.

EOU/EPZ units will be permitted to sell 50% of their

30

output in the DTA on payment of duty without

insistence on value addition.

Special Incentives for Export of SSI product/Products

from North Eastern States/New Markets

An additional Special Import Licence of 1% on total

value of exports has been given to EH/TH, etc., where

such exports of products from North Eastern States

constitute 10% or more of the total exports made.

Double weightage on such exports has been given for

recognition as EH/TH/STH/SSTH. Additional SIL has also

been given for exploration of new markets. SIL on

export of SSI products has been increased from 1% to

2%.

In case of small scale exporters holding ISO 9000 series

or IS/ISO 9000 series quality certification, the FOB value

of export will now be Rs. 1 crores and above during the

preceding three licensing years instead of the limit of

Rs. 5 crore and Rs. 2 crore respectively prescribed for

31

others.

Export /Trading /Star Trading /Super Star Trading

Houses

Earlier eligibility criterion for recognition of Export

House/Trading House/Star Trading House/Super Star

Trading House based on the average annual export

performance of the preceding 3 licensing years was Rs

10 crores, 50 crores, 250 crores and 750 crores

respectively. Keeping in mind the export target growth

to be reached by the turn of the century and the fact

that such status holders contribute between 60-70% of

the country's total exports this has now been revised to

Rs 20 crores, 100 crores, 500 crores and 1500 crores

respectively.

Incentives to improve Quality of Export Products The

SIL entitlement of exporters holding IS/ISO 9000 series

has been increased from 2% of FOB to 5% of FOB.

32

PERFORMANCE OF EXPORTS AND IMPORTS

1998-99 1999-00 2000-01 2001-02 2002-030

5000

10000

15000

20000

25000

30000

35000

40000

45000

50000

ExportsImports

Year

Exports as

percentage

of Imports1998

-99

78.366175

381999

-00

74.133304

12

33

1999

-00

74.133304

122000

-01

88.174455

792001

-02

85.243486

162002

-03

85.845290

75

During the last decade of reforms, India’s exports have

performed well. Positive policy measures combined

with robust growth of world trade have led to this

improved performance. Compared to pre-liberalization

period, India’s export to GDP ratio has increased from

5.8% in 1991-92 to 10.1% in 2000-01 and the export

growth rate has increased from -1.5% in 1991-92 to

21% in 2000-01. The export growth rate, however, has

not been steady during this decade; the rate was high

during 1993-94, 1994-95 and 1995-96 at 20%, 18.4%

34

and 20.8% respectively, but declined sharply in 1996-

97 to 5.3% and became negative in 1998-99 on

account of South East Asian crisis and worldwide

recession. It again recovered to 10.8% in 1999-00 and

reached the highest growth for the decade at 21% in

2000-01. However, the global economic slowdown and

the events of September 11 have led to a steep fall in

the rate of growth of exports during 2001-02.

Liberalisation & trade reforms have also led to a

compositional change in India’s export basket. Analysis

of our export basket indicates an increase in the share

of manufactured goods along with an overall widening

and diversification of exports.

India’s export performance has been commendable and

exports have risen from USD 18 billion in 1991-92 to a

leval of USD 44.56 billion in 2000-01. The trend starts

from a negative export growth in 1991-92, the year

when liberalisation efforts started in full swing and can

be divided into 3 distinct time periods (refer Annexure 35

table 2.1)

In the first five years i.e. 1991-92 to 1995-96, the

export growth rate averaged around 12.28%

with the highest of 20.8% achieved in 1995-96. The

good performance could be attributed to

the favorable international economic situation and

domestic reforms. In the next three years, however,

export growth rate sharply declined with growth rate at

5.3% in 1996-97 and becoming negative in 1998-99 on

account of the South East Asian crisis.

Romson’s Exports as a percentage of World

36

Exports

Export Growth Rate of India and World

Year World’s Export India’s Export Growth

Growth Rate Rate

1995 19.67 22.41

1996 5.28 8.10

1997 3.55 5.75

1998 (-)1.63 (-)4.48

1999 3.95 8.61

2000 12.4 16.46

Source: WTO International trade statistics 2001

37

Source: Indiastat

PERFORMANCE OF IMPORTS

Source: India stat

38

MAJORT COMMODITIES IN IMPORTS

Percentage share to total imports

1994-95 2000-01

Petroleum crude & products 20.69 31.53

Pearls precious & semi 5.72 9.69

Machinery 15.03 8.24

Organic & Inorganic chemicals 7.46 4.91

Electronic Goods 4.29 7.06

Gold & Silver 2.49 8.92

It is seen that during the second half of the 1990s,

there has been a shift in the commodity composition of

major items of imports. The proportion of imports of

items that are related to export production has

increased. The rise in the percentage of imports of

Pearls, Precious & semi-precious stones, and Electronic

goods to the total imports are pointers in this case. It is

also important to note that the share of the value of

import of Petroleum crude to the total imports has gone

39

up by nearly 10% mostly on account of the rise in oil

prices.

Structural Changes in Indian Exports

As already noted earlier, there has been a

compositional change in the export basket of India.

The share of manufactured goods in the total exports of

India have increased from 75% in

1991-92 to 79% in 2000-01. If we include Petroleum

products being exported from the country, the share of

manufactured goods has risen from a level of 76% in

1991-92 to 83% in 2000-01. On the contrary, the share

of Agricultural and allied products has declined from

18% in 1991-92 to 13% in 2000-01. Similarly, the share

of exports of Ores and Minerals has declined from 5.2%

in 1991-92 to 2.60% in 2000-01. This is an evidence

of Romson’s exports moving away from Resource

based products to Technology based products in

the post-liberalization period.

40

A study(1) reveals that during 1980-96 the growth of

Indian export earnings turned out to be above the

world average for all the broad categories of Extended-

Manufacturing (E-Mfg) exports including double digit

growth rates in labour and scale intensive products.

However, Indonesia, Malaysia and Thailand posted

much higher and more stable growth rates than India. A

better export performance than India in technologically

more sophisticated products by South Korea and

Taiwan requires to be underlined. During the period

1980-96, the highest growth has been achieved in the

export of labour-intensive exports at 12% by India

which is higher than the world export of labour-

intensive products at 9%. As far as changes in the

commodity composition of country specific export

basket is concerned, India improved the share of

Extended-Manufacturing significantly from 56% (1980-

86) to 71% (1987-90) in total exports but only

marginally further to 75% during 1993-96. The first 41

period 1980-1990 was marked by the rise in the share

of scale intensive exports. Share of labour intensive

exports remained constant at around 41%.The scale

intensive product exports improved their average share

from 26% in 1980-86 to 36% in 1993-96. On the other

hand, the Resource Intensive export items witnessed a

decline in their share to the total exports from 11%

during 1980-86 to about 6% in 1993-96. The other early

trade liberalising and rapidly growing economies

changed their export basket increasingly towards

differentiated and science based products. This

diversification achieved by them helped in reducing

their vulnerability to volatile world trading environment

in resource intensive exports and slower growing world

exports of labour intensive products.

The critical factor in these countries has been not the

state of the international trading environment but the

functioning of the domestic main springs of the growth

process such as the incentive structure for innovations, 42

reliable and cost effective transport and communication

facility and stable macroeconomic management - all

this has been driven by a proactive approach. India had

a headlong start in industrialisation in the 1950s well

ahead of these countries, but the persistently inward

looking character of Indian industrialisation not only

made it internationally non-competitive but led to

wastage of scarce capital and foreign exchange,

thereby slowing down the rate of economic growth.

Possibly realising the limited size of their domestic

markets at lower levels of per capita incomes, these

East Asian countries had switched from import

substitution to export-orientation fairly early in their

development process. India was the first in initiating

industrialisation but the last in trade liberalisation.

Region and country-wise trends

Analysis of trends in the share of India’s major export

destinations during 1990 shows certain

43

trends (refer table 2.3 in annexure):Asia and Oceania

region has improved its share significantly over the

decade from 30% in1990-01 to 37.5% in 2000-01.The

West European region has slipped from its top position

as India’s main export destination to the 2nd position

with its share falling from 33.6% to 25.35% over the

same period. America’s share increased substantially

from 16% to 25% mainly due to increase in share of

North America (USA & Canada) from 15.6% to 22.41%.

Exports to Africa have displayed a 17% growth rate and

share increased from 2.6% to 5.3% over the decade.

Nigeria and South Africa have shown an increase from

0.35% to 0.86% and 0% to 0.7% respectively. However,

one of the important trading partners, East European

region’s share has fallen substantially from 17.87% in

1992 to just 2.95% in 2000.

44

Major Export Destinations

Trend

In the West Europe region, Belgium, France, Italy and

Netherlands have more or less maintained their

respective shares while there is a marginal fall in the

share of Germany and UK.

In the Asia & Oceania region, among the major

partners, Hong Kong’s share improved from 3.3% to

6%, while that of Japan fell to 4.04% from 9.3%. The

share of UAE has increased from 2.42% in 1990-91 to

5.8% in 2000-01. In the American region, USA’s share

of India’s exports has increased substantially, from

14.7% in 1990-91 to 20.94% in 2000-01. In the case of

South American countries, Brazil’s share has increased

from 0.08% to 0.5% in 2000-01. CIS a major trading

partner of India having a share of 16% in 1990-91, lost

its share drastically to a mere 2.38% in 2000-01.

45

EXIM POLICY 2004-2009

UPA REGIME

The policy contains special focus initiatives for

agriculture, handicrafts & handlooms, gems &

jewellery, and leather and footwear sectors. The special

attention to agriculture is particularly noteworthy

because export promotion policies so far have focussed

mainly on the manufacturing sector. The agricultural

sector had not received the attention it deserves in a

country where the vast majority of population is

engaged in agriculture related activities. India has

taken big strides in increasing agricultural productivity

and has achieved food security. A concerted boost is

now required to be given to promotion of agricultural

exports, especially high value commercial items and

value added agricultural products.

The new policy contains a number of initiatives for

46

achieving a quantum jump in export of agricultural

products. The Vishesh Krishi Upaj Yojana will boost

exports of fruits, vegetables, flowers, minor forest

produce, and other value added products. The special

package for agriculture also includes policy measures

like duty free import of capital goods, liberalized import

of seeds, planting materials, etc and liberalized export

of medicinal and herbal products. The focus on

agricultural sector in the new foreign trade policy will,

among other things, enhance employment in some of

the poorest regions of the country.

While policies for promoting exports of above

mentioned agricultural products are a step in the right

direction, I would request the Hon'ble Minister to also

come out with a proactive policy on grain exports. It is

an area with tremendous potential and a long-term

policy would help Indian grain exporters capture larger

market share.47

A significant percentage of agricultural production

in India is damaged or lost due to poor storage,

deterioration during transit, rodent infestation, etc.

Many of India's perishable agro products often run into

quality problems which create buyer resistance in

foreign markets. There is an urgent need to strengthen

the storage and transportation infrastructure for such

products. The new policy addresses this issue to a great

extent. There is a scheme to establish Free Trade &

Warehousing Zones to create trade related

infrastructure to facilitate import and export of goods

and services. Foreign Direct Investment would be

permitted upto 100 per cent in the development and

establishment of the zones and their infrastructural

facilities. The central aim of this scheme is to make

India a global trading hub. The world class warehousing

and other infrastructure will also meet the special

needs of agricultural products.48

While announcing the new policy, a very important

observation was made that while increase in exports is

of vital importance, we have also to facilitate those

imports which are required to stimulate our economy.

This central thread runs throughout the new policy. In

all the export thrust sectors there is a policy of allowing

several duty free imports for neutralizing the incidence

of levies and duties on inputs used in export products.

This will make export inputs available at international

rates and will enhance the competitiveness of Indian

products in world markets.

There are several other features in the new policy

like setting-up of an exclusive Services Export

Promotion Council and setting-up of Bio Technology

Parks which are path breaking policy initiatives and will

have long term impact in strengthening the country's

foreign trade.

49

In conclusion I would like to reiterate the

suggestion towards urgent need for improving our

export related infrastructure like transportation, port

facilities etc so that the concept of total export chain

focus mooted by our dynamic Minister can be

implemented speedily.

FOREIGN TRADE POLICY 2004-2009

HIGHLIGHTS

 1. Strategy:

(a) It is for the first time that a comprehensive Foreign

Trade Policy is being notified. The Foreign Trade Policy

takes an integrated view of the overall development of

India’s foreign trade.

(b) The objective of the Foreign Trade Policy is two-fold:

i. To double India’s percentage share of global

merchandise trade by 2009; and

ii. To act as an effective instrument of economic

growth by giving a thrust to employment 50

generation, especially in semi-urban and rural

areas.

(c) The key strategies are:

i. Unshackling of controls;

ii. Creating an atmosphere of trust and transparency;

1. Simplifying procedures and bringing down

transaction costs;

2. Adopting the fundamental principle that duties

and levies should not be exported;

3. Identifying and nurturing different special

focus areas to facilitate development of India

as a global hub for manufacturing, trading and

services.

2. Special Focus Initiatives:

(a) Sectors with significant export prospects coupled

with potential for employment generation in semi-urban

and rural areas have been identified as thrust sectors,

51

and specific sectoral strategies have been prepared.

(b) Further sectoral initiatives in other sectors will be

announced from time to time. For the present, Special

Focus Initiatives have been prepared for Agriculture,

Handicrafts, Handlooms, Gems & Jewellery and Leather

& Footwear sectors.

(c) The threshold limit of designated “Towns of Export

Excellence” is reduced from Rs.1000 crores to Rs.250

crores in these thrust sectors.

3. Package for Agriculture:

The Special Focus Initiative for Agriculture includes:

(a) A new scheme called Vishesh Krishi Upaj Yojana has

been introduced to boost exports of fruits, vegetables,

flowers, minor forest produce and their value added

products.

(b) Duty free import of capital goods under EPCG

scheme.

(c) Capital goods imported under EPCG for agriculture 52

permitted to be installed anywhere in the Agri Export

Zone.

(d) ASIDE funds to be utilized for development for Agri

Export Zones also.

(e) Import of seeds, bulbs, tubers and planting material

has been liberalized.

(f) Export of plant portions, derivatives and extracts has

been liberalized with a view to promote export of

medicinal plants and herbal products.

4. Gems & Jewellery:

(a) Duty free import of consumables for metals other

than gold and platinum allowed up to 2% of FOB value

of exports.

(b) Duty free re-import entitlement for rejected

jewellery allowed up to 2% of FOB value of exports.

(c) Duty free import of commercial samples of jewellery

53

increased to Rs.1 lakh.

(d) Import of gold of 18 carat and above shall be

allowed under the replenishment scheme.

5. Handlooms & Handicrafts:

(a) Duty free import of trimmings and embellishments

for Handlooms & Handicrafts sectors increased to 5% of

FOB value of exports.

(b) Import of trimmings and embellishments and

samples shall be exempt from CVD.

(c) Handicraft Export Promotion Council authorised to

import trimmings, embellishments and samples for

small manufacturers.

(d) A new Handicraft Special Economic Zone shall be

established.

6. Leather & Footwear:

(a) Duty free entitlements of import trimmings,

embellishments and footwear components for leather

54

industry increased to 3% of FOB value of exports.

(b) Duty free import of specified items for leather

sector increased to 5% of FOB value of exports.

(c) Machinery and equipment for Effluent Treatment

Plants for leather industry shall be exempt from

Customs Duty.

7. Export Promotion Schemes:

(a) Target Plus:

A new scheme to accelerate growth of exports called

“Target Plus” has been introduced.

Exporters who have achieved a quantum growth in

exports would be entitled to duty free credit based on

incremental exports substantially higher than the

general actual export target fixed. (Since the target

fixed for 2004-05 is 16%, the lower limit of performance

for qualifying for rewards is pegged at 20% for the

current year).

Rewards will be granted based on a tiered approach. 55

For incremental growth of over 20%, 25% and 100%,

the duty free credits would be 5%, 10% and 15% of

FOB value of incremental exports.

(b) Vishesh Krishi Upaj Yojana:

Another new scheme called Vishesh Krishi Upaj Yojana

(Special Agricultural Produce Scheme) has been

introduced to boost exports of fruits, vegetables,

flowers, minor forest produce and their value added

products.

Export of these products shall qualify for duty free

credit entitlement equivalent to 5% of FOB value of

exports.

The entitlement is freely transferable and can be used

for import of a variety of inputs and goods.

(c) Served from India Scheme:

To accelerate growth in export of services so as to

create a powerful and unique “Served from India” 56

brand instantly recognized and respected the world

over, the earlier DFEC scheme for services has been

revamped and re-cast into the “Served from India”

scheme.

Individual service providers who earn foreign exchange

of at least Rs.5 lakhs, and other service providers who

earn foreign exchange of at least Rs.10 lakhs will be

eligible for a duty credit entitlement of 10% of total

foreign exchange earned by them.

In the case of stand-alone restaurants, the entitlement

shall be 20%, whereas in the case of hotels, it shall be

5%.

Hotels and Restaurants can use their duty credit

entitlement for import of food items and alcoholic

beverages.

(d) EPCG:

(i) Additional flexibility for fulfillment of export

obligation under EPCG scheme in order to reduce

57

difficulties of exporters of goods and services.

(ii) Technological upgradation under EPCG scheme has

been facilitated and incentivised.

(iii) Transfer of capital goods to group companies and

managed hotels now permitted under EPCG.

(iv) In case of movable capital goods in the service

sector, the requirement of installation certificate from

Central Excise has been done away with.

(v) Export obligation for specified projects shall be

calculated based on concessional duty permitted to

them. This would improve the viability of such projects.

(e) DFRC:

Import of fuel under DFRC entitlement shall be allowed

to be transferred to marketing agencies authorized by

the Ministry of Petroleum and Natural Gas.

(f) DEPB:

The DEPB scheme would be continued until replaced by

58

a new scheme to be drawn up in consultation with

exporters.

8. New Status Holder Categorization:

(a) A new rationalized scheme of categorization of

status holders as Star Export Houses has been

introduced as under:

Category Total performance over three years

One Star Export House 15 crores

Two Star Export House 100 crores

Three Star Export House 500 crores

Four Star Export House 1500 crores

Five Star Export House 5000 crores

(b) Star Export Houses shall be eligible for a number of

privileges including fast-track clearance procedures,

exemption from furnishing of Bank Guarantee,

eligibility for consideration under Target Plus Scheme

etc.

59

9. EOUs:

(a) EOUs shall be exempted from Service Tax in

proportion to their exported goods and services.

(b) EOUs shall be permitted to retain 100% of export

earnings in EEFC accounts.

(c) Income Tax benefits on plant and machinery shall

be extended to DTA units which convert to EOUs.

(d) Import of capital goods shall be on self-certification

basis for EOUs.

(e) For EOUs engaged in Textile & Garments

manufacture leftover materials and fabrics upto 2% of

CIF value or quantity of import shall be allowed to be

disposed of on payment of duty on transaction value

only.

(f) Minimum investment criteria shall not apply to Brass

Hardware and Hand-made Jewellery EOUs (this facility

already exists for Handicrafts, Agriculture, Floriculture,

Aquaculture, Animal Husbandry, IT and Services).60

10. Free Trade and Warehousing Zone:

(i) A new scheme to establish Free Trade and

Warehousing Zone has been introduced to create

trade-related infrastructure to facilitate the import and

export of goods and services with freedom to carry out

trade transactions in free currency. This is aimed at

making India into a global trading-hub.

(ii) FDI would be permitted up to 100% in the

development and establishment of the zones and their

infrastructural facilities.

(iii) Each zone would have minimum outlay of Rs.100

crores and Five Lakh sq. mts. built up area

(iv) Units in the FTWZs would qualify for all other

benefits as applicable for SEZ units.

11. Import of Second Hand Capital Goods:

a. Import of second-hand capital goods shall be

permitted without any age restrictions.

b. Minimum depreciated value for plant and machinery 61

to be re-located into India has been reduced from Rs.50

crores to Rs.25 crores.

12. Services Export Promotion Council:

An exclusive Services Export Promotion Council shall be

set up in order to map opportunities for key services in

key markets, and develop strategic market access

programmes, including brand building, in co-ordination

with sectoral players and recognized nodal bodies of

the services industry.

Further Analysis

Exports

Textiles

62

The textile has been among the major exports of India

since independence but as we have seen that in the

recent years the percentage share of Textile in the total

export has decreased considerably from 28.30 to

16.60%. The major reasons which can be attributed to

this downfall is that we have not considerably invested

into this sector where as our competitors have

surpassed us in both labour cost and technology.

63

FLOW CHART FOR EXPORT

64

SUGGESTION

65

New sectoral initiatives for industry were:

o The machinery and equipment industry shall be exempt from customs duty.

o (c) Enhancing export from the present Rs.10000 to Rs.20000 crore, and in the process providing overall additional employment to about one million people. 

Streamlined trade procedures

Liberalised import regime

Thrust on export orientation

o Medium Term Export Strategy, 2002

1% share in global exports by 2007

o Foreign Trade Policy 2004-2009

To double India’s share in global merchandise trade by 2009

o Legal framework for regulation of International Trade - provided by – Foreign Trade (Development & Regulation) Act, 1992 .

o Objective of the Act : Growth & Regulation of Foreign Trade - Facilitating Imports & Exports.

o Previous Act was – Import & Export (Control) Act, 1947 .

66

o Shift in the focus – from ‘ Control ’ to ‘ development ’ - due to emphasis on liberalisation & globalisation process as a part of Economic Reforms of 1991.

o The new Exim-Policy is essentially a roadmap for the development of India's foreign trade.

o It contains the basic principles and points the direction in which we propose to go.

o Unshackling of controls and creating an atmosphere of trust and transparency to unleash the innate entrepreneurship of our businessmen, industrialists and traders.

o Import of capital goods and equipment, thereby increasing value addition and productivity.

o Activating our Embassies as key players in our export strategy and linking our Commercial Wings abroad

o To give a major boost and strategic direction to the manufacturing sector and exports

o To act as an effective instrument of economic growth by giving a thrust to employment generation.

o To double the percentage share of global merchandise trade within five years

67

o India to be a major gainer from emerging global trends

o A policy of partnership

o FTP focuses on an integrated view for the overall development of country’s foreign trade.

o Special attention is given to agriculture and allied sectors

o New schemes were introduced to boost exports

o The policy has further removed quantitative restrictions from 29 items

o Provides for 100 % FDI to establish free trade zones and ware housing zones

o The central theme of the new policy is while increase in exports is quite important at the same time, to facilitate those imports which are required to stimulate the economy.

o Duty free import entitlement.

68

CONCLUSION

International trade thrives on credit. Where there

is a little choose from between the quality of

goods from one producer or the other, it is often

the inducement of credit terms offered by a seller

which clinches the contract with the buyer.69

It is obvious that the buyer and seller have

conflicting interests in the financial package, but

there must be some compromise before a deal

can be concluded. Banks can provide a solution

acceptable to both parties, by providing credit to

either the buyer or the seller. In many countries,

export credit insurance assumes the risk of non-

payment-for a premium-and this can be assigned

to the funding bank. Bank and insurers agree

that the level of credit need not to be linked to

the size of the customer’s balance sheet and may

be based on their ability to perform the contract

from which the repayment will be made. So

balance sheet weakness may be compensated

for by strong performance capability. The bank

could also repurchase an exporter’s receivables,

thereby refinancing any supplier’s credit (i.e. the 70

credit granted by the exporter to the buyer); the

bank thus becomes the lender.

EXPORT STRATEGY An exporter, like any other businessman,

needs money to continue operating m business. So he wants a speedy payment for his goods. He also wants protection against any default on the customer. The customer however, requires credit. An exporter can maximise his chances of getting orders by offering the right credit terms.

Export Policy can protect against default, but the timing of the exporters cash inflows will depend on the terms of payment or on his access to export.

71

QUESTIONNAIRE QUESTIONNAIRE

I am conducting a survey of Import-Export Section at

your organization as part of my project. I will require

your responses on the questions below to compile the

project.

I request you to tick on the responses & write in the

space provided.

Name-

72

Designation-

Experience-

Organization-

1. Are Import – Export Policies of Government of India

programs are necessary?

(a) Yes (b) No

2. Have you ever attended any Import – Export

Policies of Government of India programs?

(a) Yes (b) No

Are you satisfied with the training of Import – Export

Policies of Government of India programs &

development program conducted at your organization?

(a) Yes (b) No (c)

Can’t say

3. Have you attended any training Import – Export

Policies of Government of India programs &

development program? If so please list courses you

have attended in the past 2 yrs.73

Name of

the

course

Course

provider

How did

you find

about the

course

Did the

course

meet

your

learning

needs

If not,

why?

4. In the past few years do you feel you have

attended Import – Export Policies of Government of

India programs a sufficient no. to knowhow the

complete knowledge of Impost – Export policies of

India and global environment?

(a) Yes (b) No

74

5. According to your professional needs, which policy

areas should a training program be focused on?

(a) Import - Export

(b) Enterprise

(c) Enlargement

(d) Research & innovation

(e) Institutional affairs

(f)Others

6. How are your training of Import – Export Policies of

Government of India programs & learning needs

generally identified?

(a) As part of a formal appraisal system

(b) As part of induction program of new staff

(c) As the need is perceived by yourself

(d) As the need is perceived by management.

(e) As part of an organizational training plan

(f)Others.

75

7. How well is your need for ongoing training of

Import – Export Policies of Government of India

programs & skill development being met?

(a) Very well

(b) Adequately

(c) Less than adequately

8. If you are not satisfied with the training of Import –

Export Policies of Government of India programs &

development program currently available to you,

please indicate why not?

(a) Topics which would help me were not

offered

(b) Times offered are not convenient

(c) Too expensive

(d) Quality of instruction is poor

(e) Others

Is there anything else you would like to comment

on in regards to current learning & training

opportunities or suggestions for future areas of training 76

& development?

Thanks

BIBLIOGRAPHY

www.romsons.com

www.sinetinfo.com

News Papers

Business

Export Import Documentation

77

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