Export Procedure from India

For a beginner, who is planning to export goods from India must be conversant with the rules and regulations laid down by the Government of India.

An exporter must take care of various aspect related to export of goods/ commodity from India to anywhere in world. There are some basic procedures which should be followed by an exporter.

Let us try to understand Step-by- step.

1. First of all, there should be a firm through which you want to export. It may be a proprietorship firm, partnership firm, private limited, HUF etc. If you have an existing firm you can do export and import in that particular company and there is no need to form a new firm to do export or import business in India.

2. The firm/ entity through which you want to do export and import, you must get and Importer Exporter Code / License for that firm. This License can be done online through DGFT site by filling up required detail and uploading documents.

3. The firm should have a PAN and GST Number. Import Export Code (IEC) issued by DGFT will bear number as PAN.

4. You need to have a bank account in the name of your firm. You should prefer bank’s branch which is dealing Forex.

4. Registration with required EPC (Export Promotion Council) according with the product and commodity which is to be exported. You need to get a RCMC (Registration cum Membership Certificate) from that Export Promotion Council.

5. AD (Authorized Dealer) Code Registration. This can be done online or offline basis. You need to get a letter from you banker for this and with other relevant documents you will have to give it to your CHA (Custom House Agent) for registration with Customs EDI Portal.

6. Appointing CHA (Custom House Agent) and FF (Freight forwarder). CHA will take care of your custom related formalities, documentation etc and Freight forwarder will ensure containers and transportation of your cargo.

7. Negotiation with foreign buyer and preparing contracts with them covering different aspects and as per your business requirements.

8. Once all these above done, then there comes filing of documents with customs based on your invoice. You will have to handover your invoice and other documents which will declare your product, quantity, price etc to your CHA who will process these documents with customs and will ensure clearance from them.

9. Do all required inspection of cargo with independent surveyor as per your contract agreed with the buyer. Do fumigation if required.

10. Once cargo is stuffed in containers and loaded on vessel, then take originals bills of lading from your freight forwarded.

11. Prepare all set of documents as required in foreign buyer contract (Documents should be as per Importing Country Norm).

12. Send a scan copy of documents to your buyer but “Please note, do not send copy of express bl or seaway bl or airway bl” by email. Because you buyer can clear cargo only on the scan copy of these bills of lading. So if you have not received full amount, never share scan copy of these bills of lading.

13. As per your contractual terms, present documents in your bank who will send documents to buyer’s bank. Clearly state your payment terms which is agreed between you and your buyer in the contract.

You can not send documents to your buyer directly by courier. This can be done only in few cases like, if you have received full payment from your buyer or it is mentioned in the terms of letter of credit or your firm/ company is a status holder.

14. Your buyer’s bank will handover these documents to the buyer as per your instructions which is given in the bill of exchange and forwarding letter. It will be same as payment terms which you have agreed with your foreign buyer in the contract.

15. Once your buyer makes payment, their bank will transfer this amount to your bank and your bank will intimate you regarding receipt of fund.

16. Then you will have to submit all relevant documents and forms to your bank for realization of fund.

17. Once payment against your export of cargo is settled in Bank’s system, you can get a BRC copy (Bank Realization Certificate)  from the DGFT portal.

This is a brief of export procedure and cycle of export shipment.

Disclaimer:

“The author assumes no responsibility or liability for any errors or omissions in the content of this site and for this blog. The information contained in this site is provided on an "as is" basis with no guarantees of completeness, accuracy, usefulness or timeliness.”

Economy Vs (Un) Employment

Economy is directly related to providing employment opportunities. Does growing economy with fast pace of development provide as many employment opportunities as people imagine or politicians tell them? Today we will discuss that  in what proportion the employment opportunity is generated with expansion and development of the economy mainly in Indian context.

We will try to understand complete scenario after India's independence because in true sense the ups and downs in our economy can be assessed only after independence. India has adopted mixed economy since independence. In this form of economy, foreign investors were restricted except in certain sectors. Even private investment was available in only few areas. The government made its own investment and structured public industries which could meet the needs of India and bring the economy back on track. Public undertaking has done excellent work in many fields and has become a source of permanent employment. All these public enterprises gradually became the backbone of the Indian economy. However, it can be a matter of debate about the role of Public Sectors which is being considered as burden of the Government.

Later on, Foreign investment was opened in India when this country was struggling with the lack of foreign currency and due to which to meet domestic demand for Crude and essential items, Indian gold reserves had to be mortgaged. One of the reasons for keeping foreign investors away India's long slavery and fear of getting foreign domination. The true expansion of the economy in India began in 1991 when Finance Minister Dr. Manmohan Singh and the then Prime Minister PV Narsimha Rao opened the Indian market to foreign investors. The advantage of this was the increase of Foreign Currency Reserve and creation of new jobs in many sectors. If we see from the year 1991 onwards, the economy continued to develop gradually and new employment opportunities were created. Per capita income increased and there was a lot of improvement in the purchasing power /spending power.

We have to note that due to this reform made a very substantial positive change in Indian Middle Class and Lower Middle Class. Continuation to this, government schemes like NREGA also contributed a lot which proved a boon to daily wage worker and improved their economic position. It can be very well underlined that demand from lower income group from villages & sub urban areas rose significantly and gave pace to economic growth.

But now one of the biggest questions is that when the government is making so much effort, yet new employment opportunities are not visible, and the level of unemployment is also increasing continuously. If we discuss the contemporary situation, then we have to pay attention to some points, which can be the main reasons for this situation .

Firstly, since Corona, almost all the countries of the world have faced economic problems. The closure of businesses due to the lockdown and loss of employment in the unorganized sector posed a new challenge to the economy, which was already facing and trying to come out of Demonetization in India.

Secondly, the war between Russia and Ukraine created logistic problems that affected demand and supply to a great extent. Delay in movement of cargo/commodities adversely impacted manufacturing and trading sectors. High price rise in international freight was also a major factor all around the world.

Thirdly, All pending vacancies in Government sector which directly employs a huge number of manpower are still vacant. There is almost new nil vacancies. The government should keep in mind that government employees are a huge percentage that generate demand in the economy. It would be advisable that Government of India on a very pro-active way should induce people on vacant posts and try to generate new job opportunities apart from private companies.

Fourthly, There is a misconception that boosting and assisting big private companies will create more job opportunities and improve economic growth by creating demand in market. The main reason behind this is the use of automation and robotics by private industries, promoting unmanned production to reduce input costs which is not creating jobs as it should have been. It is simply accruing their net worth. This challenge will become more serious in the coming days.

Fifthly, the government should encourage very small and medium industries, which the government is currently doing through Mudra loans. But the effect of its implementation is not visible. It should be studied in totality and the government should take feedback of every Mudra loan taker and decide how effectively they have used this loan. This will give further roadmap to the government which will help the government schemes in working the unemployment rate.

 

Disclaimer:

“The author assumes no responsibility or liability for any errors or omissions in the content of this site and for this blog. The information contained in this site is provided on an "as is" basis with no guarantees of completeness, accuracy, usefulness or timeliness.”