MBA_531_Export Import Documentation

India Trade Promotion Organization (ITPO) was consolidated by the consolidation of Trade Development Authority (TDA), a Registered Society under Ministry of Commerce and Industry, with Trade Export Authority of India (TFAI) with impact from 1 January 1992. TFAI was before consolidated, under Section 25 of the Indian Companies Act, 1956, on 30 December 1976 by amalgamating 3 associations of the Government of India viz. India International Trade Export Organization, Directorate of Exhibitions and Commercial Publicity, and Indian Council of Trade Exports and Exhibitions and initiated tasks with impact from 1 March 1977. ITPO, during its reality of over thirty years, has assumed a proactive part in catalysing exchange, speculation, and innovation move measures. Its special devices incorporate getting sorted out of exports and displays in India and abroad, Buyer-Seller Meets, Contact Promotion Programs, Product Promotion Programs, Promotion through Overseas Department Stores, Market Surveys, and Information Dissemination. The Contribution of ITPO: The ITPO manages the accompanying capacities to advance and lift the export exercises: i. Industry Interview Measure: The Committee noticed that no institutional component for a standard consultative interaction with enterprises for exchange advancement has been set up by ITPO and suggested that such a cycle be set up. ii. Foreign Workplaces: The Committee felt that the choice of shutting its foreign workplaces by ITPO ought to be re-examined since the representatives positioned at these workplaces gave important to exchange information and fashioned helpful connections with those nations. iii. Review Component: The Committee prescribed establishing a normal survey instrument to assess the commitment of the Commerce and Trade wing of Indian government offices towards exchange advancement. iv. Export Promotion Councils (EPC): The Committee noticed that the job of ITPO in send-out advancement has certainly decreased because of EPCs, which are only centred on exchange advancement for a specific area. The Committee suggested that ITPO be more proactive in finding new business sectors for exchange advancement and that ITPO's order is reclassified to devote its administrations only for exchange advancement of the Micro, Small, and Medium Enterprises area. v. Organiser of Exports: The Committee was of the assessment that ITPO zeroed in additional on its part as coordinator of presentations and less on the advancement of exports and exchange. It noticed that, in the shows, the quantity of foreign exhibitors and guests is low, and prescribed that ITPO put forth attempts to expand outsider footfall. vi. Grievances of Indian Show Industry: The Committee was educated that ITPO, as the controller of presentations in India and proprietor of a few display spaces, has 101 CU IDOL SELF LEARNING MATERIAL (SLM)

manhandled its predominant situation by forcing unjustifiable conditions. It suggested that ITPO present a detail of Redressal activity taken on explicit issues/complaints of the display business inside a quarter of a year of the accommodation of this report. vii. Rental Charges: The Committee noticed that the rental charges for Pragati Maidan, the greatest presentation space in India and worked by ITPO, is the most elevated on the planet. The Committee felt that this significant expense diminished the coordinator's interest in guest advancement, and ITPO ought to consider excusing rentals. viii. Trade and Presentation Focus: The Committee noticed that foundation of exchange and show focuses has been delayed in the country. It suggested the advancement of exchange cum-presentation focuses on need premise and the up degree of existing offices. ix. Financial Execution: The report of an autonomous reviewer from 2012-13 noticed that ITPO's pay has been exaggerated because of an under-announcing of liabilities. The Committee, taking solid note, requested that ITPO present a status note on the matter within a quarter of a year of the accommodation of this report. 5.8 ECGC Export Credit Guarantee Corporation of India (ECGC) is an Indian endeavour which is directed by the Government of India through the Ministry of Commerce and Industry. ECGC which is entirely claimed by the Indian Government was set up in the year 1957 to advance exports by offering credit hazard protection and unified administrations to the exporters. Export Credit Guarantee Corporation of India is on a very basic level an export advancement association, which looks to improve the intensity of Indian exports by offering them credit protection covers. Throughout the long term, ECGC has considered different export credit hazard protection items fitting the necessities of Indian exporters. Export Credit Guarantee Corporation of India offers insurance against non-instalment by a merchant. Because of this protective cover, the monetary organizations are better positioned for loaning and giving bigger credit to exporters. ECGC offers FICO scores just as offers the data on different nations and dangers related to working with/in those nations.  Functions of ECGC i. It offers a variety of credit hazard protection covers to the Indian exporters against the misfortune regarding the export of their merchandise and ventures. ii. It gives Export Credit Insurance covers to the banks and other monetary organizations for empowering exporters to discover better administrations from them. iii. It offers Overseas Investment Insurance to the Indian organizations putting resources into Joint Ventures (JVs) abroad as advance or value. 102 CU IDOL SELF LEARNING MATERIAL (SLM)

ECGC is the fifth biggest acknowledged insurance agency managing the exports of any country. Export Credit Guarantee Corporation of India offers security against non-instalment by a merchant. Because of this protective cover, the monetary organizations are better positioned for loaning and giving bigger credit to exporters. ECGC offers FICO scores just as offers the data on different nations and dangers related to working with/in those nations. 5.9 EXIM BANK Exim Bank was set up by the Government of India, under the Export-Import Bank of India Act, 1981 as a purveyor of export credit, reflecting worldwide Export Credit Agencies. Exim Bank fills in as a development motor for enterprises and SMEs through a wide scope of items and administrations. This incorporates import of innovation and export item advancement, sends out creation, trade showcasing, pre-shipment and post-shipment, and abroad investment. The primary capacity of the Export and Import Bank of India is to give monetary and other help to shippers and exporters of the country. Furthermore, it supervises and facilitates the working of different organizations that work in the import-send out area. A definitive point is to advance foreign exchange exercises in the country. Exim Bank broadens Lines of Credit (LOCs) to monetary establishments, territorial improvement banks, sovereign governments, and different substances abroad, to empower purchasers in those nations to import formative and framework projects, gear, products, and ventures from India, on conceded credit terms. EXIM Bank has laid solid accentuation on upgrading project trades, the subsidizing alternatives for which have been improved with a presentation of the Buyer's Credit-National Export Insurance Account (BC-NEIA) program. During the year finished March 31, 2020, EXIM Bank endorsed credits of Rs 40255 crores, while payment added up to Rs 33735 crores. Advance Assets remained at Rs 99447 crores as of March 31, 2020. It was already a part of the IDBI, however as the foreign exchange area developed, it was made into a free body.  Importance of the EXIM Bank Other than giving monetary help, the Export and Import Bank of India bank is continually searching for approaches to advance the foreign exchange area in India. In the mid-1990s, EXIM presented a program in India known as the Clusters of Excellence. The point was to improve the quality principles of our imports and exports. It additionally has a tie-up with the European Bank for Reconstruction and Development. It has consented to co-account programs with them in Eastern Europe. To advance exports EXIM bank likewise has plans, for example, creation hardware account program, trade showcasing money, seller improvement money, and so forth. 103 CU IDOL SELF LEARNING MATERIAL (SLM)

5.10 SUMMARY  The Export Promotion Councils have an urgent part in instructing, preparing, financing the exporters, and shielding their inclinations every once in a while.  They fill in as a vital connection between the worldwide players and exporters.  The fundamental target of Export Promotion Councils is to create and advance the exports of the country.  Each Council is accountable for the advancement of a particular gathering of activities, items, and administrations. The committee helps in supporting the improvement of export-related ventures.  The SEZs, Duty-Free Zones, FIEO – IIFT – EOUs – SEZs – ITPO – ECGC – EXIM Bank have a lot of commitment in sending out products as well as administrations by pulling in more foreign money for India.  The sending out advancement chambers should overhaul their arrangements to line up with the requests and standards of worldwide business sectors, legitimate changes, and client assumptions. 5.11 KEYWORDS  Monetary: Public Finance or Revenue (Ex. Financial Government Policy)  Item: An item or substance which can be sold, purchased, exchanged, and so on Ex. Grains.  Redressal: Compensation, Correction  List: A deliberate and complete rundown of things (items/administrations and so on) organized in a sequential request. Ex. Book Catalogue.  Pisciculture: The development of fish. 5.12 LEARNING ACTIVITY 1. list five functions of export promotion councils. ---------------------------------------------------------------------------------------------------------------- ---------------------------------------------------------------------------------------------------------------- 2.Prepare the List of Special Economic Zones in North India in 2021 Sr. No. Name of SEZ State 1] 2] 3] 4] 5] 104 CU IDOL SELF LEARNING MATERIAL (SLM)

6] 7] 9] 5.13 UNIT END QUESTIONS A. Descriptive Questions Short Questions 1. Define 'Export Promotion Councils’. 2. A streamlined commerce zone (FTZ) is a class of extraordinary financial zone.'- Justify. 3. Make elite of any five endorsed Duty-Free Zones in India with their qualities. 4. Discuss the program and exercises led by FIEO. 5. How EXIM Bank is helpful for the export of products and ventures from India? Long Questions 1. Analyse the current state of Special Economic Zones in India with the assistance of models. 2. Differentiate among SEZs and Free Trade Zones in India. 3. Illustrate the nature, capacities, and meaning of EXIM bank in India from foreign exchange viewpoints. 4. Examine the arising worldwide market patterns inside the setting of COVID-19 flare- up and relate how sending outboards would address the worries of exporters. B. Multiple Choice Questions 1. There are ______ endorsed Free Trade and Warehousing Zones (FTWZs) in India as of now. a) 6 b) 7 c) 8 d) 9 2. ______________ is a Mini-Ratna Category-1 Central Public Sector Enterprise (CPSE) with 100% shareholding of Government of India. a) ITPO b) ECGC 105 CU IDOL SELF LEARNING MATERIAL (SLM)

c) EXIM Bank d) All of these 3. ____________ is the fifth biggest insurance agency managing the exports of any country. a) Exim Bank b) ITPO c) ECGC d) None of these 4. The Exim Bank expands Lines of Credit (LOCs) to _________________. a) Overseas monetary foundations b) Regional advancement banks c) Sovereign governments d) All of these 5. __________ has a tie-up with the European Bank for Reconstruction and Development. a) ECGC b) Exim Bank c) ITPO d) Regional Bank Answers: 1-(c); 2-(a); 3-(c); 4-(d); 5-(b). 5.14 REFERENCES Textbooks  Bandopadhyay, K. & Khan, T.L. (2020). Factors of Export Promotion of MSME in India with Special Reference to Raw Material Availability, Sage Publication.  IBEF. (2021). A Report on Foreign Trade Policy of India. Retrieved from: https://www.ibef.org/economy/trade-and-external-sector. 106 CU IDOL SELF LEARNING MATERIAL (SLM)

 Ardila, A.D. (2008). Promotion of Micro, Small and Medium Enterprises through Micro Finance. Sage Publication. Reference Books  Seyoum, B. (2009). Export-Import Theory, Practices, and Procedures. Taylor & Francis.  NRC (National Research Council) (2006). Analyzing the U.S. Content of Imports and the Foreign Content of Exports. The National Academy Press, Washington, D.C.  Davidson, C., Matusz, S. J. (2009). International Trade with Equilibrium Unemployment. Princeton, NJ: Princeton University Press. Websites  https://fieo.org  https://www.ecgc.in/  https://www.eximbankindia.in/ 107 CU IDOL SELF LEARNING MATERIAL (SLM)

UNIT 6: EXPORT PROCEDURE & DOCUMENTATION Structure 6.0 Learning Objectives 6.1 Introduction 6.2 Aligned Documentation System 6.3 Commercial Invoice 6.4 Shipping Bill 6.5 Certificate of Origin 6.6 Summary 6.7 Keywords 6.8 Learning Activity 6.9 Unit End Questions 6.10 References 6.0 LEARNING OBJECTIVES After studying the unit, the students would be able to:  Explain the role of aligned documentation system in export business.  Describe the commercial invoices.  Explain the shipping bills and their contribution in export activities.  Create the certificate of origin. 6.1 INTRODUCTION Export is one of the major components of international trade. It primarily enhances the trade internationally and thereby promote the economic activities internally by giving employment, production, and revenues. Businesses export goods and services where they have a competitive advantage. In the case of merchandise exports, India is considered as one of top twenty nations in the world. With the ever-increasing trade liberalization made by the Indian Government, there exists very huge opportunity in creating a profitable business in the export area. Any entrepreneur can initiate export business unless he must be well aware of rules and various regulations based on these transactions and their documentation process. As per the Section 2(18) of Customs Act 1962, “Export means taking goods out of India to a place 108 CU IDOL SELF LEARNING MATERIAL (SLM)

outside India.” The Directorate General of Foreign trade (DGFT) and related offices regulates the export-trade, and these are under Commerce and Industry Ministry, Department of Commerce. Policies and procedures for these exports outside India are announced by the DGFT, from time to time. The various process during the export is complex in nature as the exporter should be required to fill many documents namely bills of entry, documents for the foreign exchange, permits for the export trade etc. It confirms that the order should reach the right destination faster, safely without any issues. Also, these documents include the ones which are required by the importer namely proforma and its commercial invoices, inspection documents for pre- shipping, origin and health certificates, payment related documents and the transportation related documents namely the B/L, the freight transit order. These documentation process and the product types for the shipment varies with country to country. For the sake of various physical transportation difficulties and complexities of these documentations, many exporters seek the help from international freight forwarder. Governing Authorities The governing policies for the exports are Foreign Trade (Development & Regulation) Act, 1992 and Export-Import (EXIM) Policy. In India, the main governing and responsible body for the export as well import trade is Directorate General of Foreign Trade (DGFT). The exporters usually do registrations with the above-mentioned authorities for ensuring all legalities related to exports which have to be met and hence allowed for any promotion schemes of export. These exporters should meet the guidelines issued by RBI, i.e., Reserve Bank of India, so an exporter should possess an Import-Export Code Number which is issued from the respective region wise licensing authority.  Export Procedure The various steps or procedure for the export are mentioned below: Step 1. Order Receipt: The exporter must be registered with authorities like Income tax department and Reserve Bank of India (RBI). Also, they have agents which collect orders from the foreign importers. The Indian exporters get orders either directly from foreign importers or through respective indent houses. Step 2. Obtaining License and Quota: Once the exporter receives order from the foreign importer, they have to apply for Government of India’s export licence from Export Trade Control Authority and issued according to the allowed quantity of good to export. Step 3. Letter of Credit: It is usually asked along with the order from the importer for trading goods by any exporter. 109 CU IDOL SELF LEARNING MATERIAL (SLM)

Step 4. Fixing the Exchange Rate: Next step is mutually fixing the exchange rate, for which the goods are traded, by the exporter and the importer. Foreign exchange is defined as the rate by which home currency should be traded or exchanged using the foreign currency. The foreign exchange rate varies on timely basis. Step 5. Formalities in the Foreign Exchange: According to Foreign Exchange Regulation Act of India (FERA), each Indian exporter should obey the formalities and need to submit the declaration under the acts of exchange control. The declaration is as mentioned below:  Any Foreign exchange thus gained by an exporter from export trading must be disposed and inside the time frame mentioned by the RBI.  Only through the foreign exchange’s authorised dealers, the negotiations and shipping documentation are allowed.  The collection of the payments from an export trading should be done only through approved ways. Step 6. Steps for the preparation of Order execution: Following arrangements are being done for the execution of the order by an exporter. I. To Mark and pack the goods for exporting according to the importer's specifications; II. Arrange the pre-shipment inspecting and thereby receive Export Inspection Agency’s inspection certificate. III. Obtain the required marine insurance policy from the Export Credit Guarantee Corporation (ECGC) against some credit risks; IV. Procure marine insurance policy as and when it is required, V. To appoint a custom house agent for handling customs and its associated issues. Step 7. Formalities by a Forwarding Agent: It includes: 1. Forwarding agent initially need to obtain necessary permits from the department of customs for export. 2. The agents have to provide all the details pertaining to the goods like its quantity, nature, quality, its weight to shipping firm. 3. Shipping order or billing is done by the agent. 4. Two copies of port challan are created by the agent and the dues have to be paid: 5. The good’s loading on to the vessel or ship is to be carried out on as per shipping order and has to be performed in front of custom’s officers. This entire job is carried under the responsibility of ship master. 6. After loading the entire goods, the ship master acknowledges and gives a receipt. Step 8. Bill of Lading: When the Indian export counterpart presents the receipt, copy issued by ship master to shipping company, they provide Bill of Lading. It is defined as official 110 CU IDOL SELF LEARNING MATERIAL (SLM)

receipt containing all the commodity or good’s details which were loaded in the vessel and even the destination port. Step 9. Shipment Advise to the Importer: Indian exporter gives shipment advice along with packing list copy, commercial bill or invoice and copy of B/L in return to such importer so that he gets the information regarding the good’s despatch. Step 10. Documents presentation to Bank: Indian exporter confirms that he has carried with all the necessary and required shipping documents such as Consular invoice, marine Insurance Policy, Certificate of Origin, Commercial Invoice, Bill of Lading. Then the exporter presents a bill of exchange which is based on commercial invoice. So, bill of exchange combined with all such documents is termed as Documentary Bill of Exchange. The exporter presents those documents to his bank. Step 11. The Realisation of Export Proceeds: In order to have realisation about the proceeds of the export, the commodity exporter has to undergo specific formalities in the bank. While submitting the bill of exchange, all these formalities will begin. Usually, the exporter receives payment in the foreign exchange. 1.2 ALIGNED DOCUMENTATION SYSTEM In India since 1991 new standardized documents are introduced by the Government under Aligned Documentation System (ADS). It is according to UN layout key. These standard forms are commonly used by various exporters while preparing the documents related to exports and it gives convenience to each concerned parties. Also, these standard forms are being employed in over “100 countries”. ADS have simplified procedure pertaining to export documentation. Objective of ADS: The main aim of ADS is to support every member which belongs to the international trade. At first, the information collected is marked in Master Doc 1 and Master Doc 2 and these docs are printed in standard A-4 size paper of uniform length. Then the common data from these docs are written in the slots of same locations. Exporter can prepare 14 commercial documents from the total 16 docs using Master Doc 1. The two commercial documents which are not prepared include bill of exchange and Shipping Order. Now ADS helps in simplifying documentation related to trade by facilitates quick entry and reading. It thereby helps all the parties which belong to the trade. Preparing of Documents Under the Aligned Documentation System The Aligned Documentation System (ADS) is based on concept of UN key layout. This methodology enters the identical information on the same position of the standardized forms and are printed on uniform sized paper. It enables in preparation of one Master doc which contains common information present in all the documents and has taken the required copies 111 CU IDOL SELF LEARNING MATERIAL (SLM)

from same Master Doc using suitable mask technique and reproduction technique. In mask technique, a transparent film made of polyester having opaque white patches to mask out those data which is not at all required for any particular document. Here separate blank or mask is needed for each such doc. As and when needed, any information pertaining to specific doc can either pre-printed or included. For the sake of aligned documentation, they can be classified into commercial docs as well as regulatory docs. A commercial document is the one in which custom trade are needed for the good’s physical transfer from the exporter to respective importer. Among the total 16 commercial docs which are present in framework of export documentation, 14 no’s have standardized and been aligned to one. These are listed as Performa invoice, the packing list, commercial invoice, certificate of quality control inspection, any shipping instructions, mate receipt, intimation for any inspection, declaration of insurance, application for the certificate of origin, certificate of insurance, B/L or combined transport document, any shipment advice and letter for Collection / Negotiation of documents to the concerned bank. According to government notifications, all documents should have unique common number which is the PAN number. But regulatory and pre-shipment documents pertaining to export are termed as those docs which are prescribed by various bodies of Government which is following the requirements of various such rules and regulations made under those relevant laws which governs the export trade including export inspection, export trade control, any foreign exchange regulation and customs. From the total nine regulatory documents, the standardized and aligned four documents are: (I) Shipping bill or bill of export; (II) Exchange control declaration (OR from); (III) Export application dock challan / port trust copy of shipping bill; (IV) Receipt for payment of port charges. Following noted points should very carefully done while preparing the documents related to export which belongs to new system. They are made on forms which are pre-printed and can be found in market provided by related authorities. Also pre-printed shipping bills are being supplied by custom house agents or by Freight forwarders. For ensuring the clarity as well as legibility, these docs are typewritten which made easy for to take photocopy as well as for computerization works. Photocopy must be taken using either Master Doc-1 or Master doc-2 whichever is appropriate. But it is to be noted that the usage of the photocopy machine is not compulsory. However, these documents should also be prepared by hand and for this case the advantages of ADS will not reach to exporters. Same way, these documents can be made using a computer. The software package required for this activity is developed in Indian Institute of Foreign Trade - New Delhi and National Informatics Centre - New Delhi. Also noted that the form size as well the layout would be as prescribed and the exporters must strictly follow this based on its size, box-wise space and even its layout. For those exporters 112 CU IDOL SELF LEARNING MATERIAL (SLM)

whom no access to either computer or photocopy machine can type the appropriate information or data in boxes provided. Aligned Documentation System under Aligned Documentation System, different forms used in the International trade transaction are printed on the same sized paper and in a way that the identical items of information are provided same relative slots in each documents. ADS can be classified into Commercial Documents and thereby require physical shifting of goods or commodities and title from respective exporter to the concerned importer and realization of export sales. 3. Regulatory Documents: Regulatory pre-shipment documents for the exports are prescribed by different government bodies and the various departments for complying with various regulation and various rules which comes under the relevant laws governing such export trade as inspection of export, foreign exchange regulation, control on export trade, customs, etc. Out of nine regulatory docs, four numbers are standardized and aligned ones. These are shipping bills or bill of export, exchange control declaration form (GR Form), dock challan for export application or port trust copy of the shipping bill and receipt for payment for port charges. Figure 6.1: International Trade Documentation: Framework 113 CU IDOL SELF LEARNING MATERIAL (SLM)

1.3 COMMERCIAL INVOICE A commercial invoice is defined as special type of export document which provide help for your package to get clearance from customs. A well properly completed and perfect export commercial invoice which helps custom personnel to quickly decide the kind of taxes and import duties for your package. And this helps in preventing delays. In addition, customs officials can check and verify whether the package meets all the required requirements and can pass on information, for instance the recipient’s tax liability, to concerned country of destination. If you complete this invoice very correctly, a greater chance is there for package to arrive on stipulated time. Packages within the EU do not need this type of special invoice. A list belongs to EU countries can be found on website of the Dutch Tax and Customs Administration. If there is any doubt, one can also consult or check the list of exceptions because few countries or territories are part of EU but won’t be the part of EU customs territory. In addition to commercial invoice, some of the international shipments outside the EU require custom declaration (CN22 or CN23), a CP71 dispatch note, and very possibly a Certificate of Origin (CO). This article will mainly focus and discuss the various commercial invoices for the international shipping. Three copies of commercial invoices must be required for all such non-document shipments. Business or personal stationery can be used for these invoices if it has the required shipment data or information which is present on the invoice. Required Items  Items which are required for the commercial invoice include:  Shipper’s or seller’s address and its name and address which is displayed on address label including name of a contact person and his telephone number.  Consignee’s address and its name including destination country and postal pin code which is displayed on address label. For ensuring prompt delivery action, a contact person name and his telephone number should include.  Invoice date.  PO or the purchase order or the invoice number which ever applicable.  Purchaser’s (importer) address and his name when it is different from consignee mentioned, including the name of contact name and his telephone number.  Complete and full description of each item which is being transported or shipped. Which is that item?  What is the item prepared with? What is it uses? (Include Customs Harmonised Codes if you know.)  Country of origin. Where was the commodity or the item prepared or manufactured?  Total number of units, its value and total value of each particular item. For any samples or articles having no commercial value, a nominal value must be mentioned for purpose of customs.  Declared value for the carriage.  Total cost of the shipment which includes the currency of settlement. 114 CU IDOL SELF LEARNING MATERIAL (SLM)

 Reason for good’s export. For instance, sale, repair, inter-company.  Terms of Sale which defines the charges which include the total invoice value. For instance: Bill Shipper.  Number of packages and package total weight.  Shipper's signature and the date of signature. Figure 6.2: Commercial Invoice: Format 6.4 SHIPPING BILL A Shipping Bill is an important document required by the customs authorities for the clearance of goods. Many formalities have carried out for an exporter when transporting goods between the countries which includes submission of various applications, acquiring of licenses, duty payment etc. For getting the clearance for the export, the exporters have to 115 CU IDOL SELF LEARNING MATERIAL (SLM)

provide the application known as shipping bill. The exporter may be exempted from loading goods unless he provides it. The export may happen in different mediums such as ship, air and vehicle. The goods can only be taken on to the ship or board if goods are being accompanied by below mentioned documents. At seaport/ airport Shipping bill At land customs station Bill of export For goods transhipment Bill of transhipment. Table 6.1: Documentation List A shipping bill should be given or submitted through electronic means. But for the cases where electronic means are not working, the Principal Commissioner or the Commissioner should grant the exemption and accept the application physically application. It has got many forms of which they are differentiated using colour. The colour scheme is mentioned below: Sr. No. Form Name Colour 1. Dutiable Goods Yellow 2. Duty-free goods White 3. Goods with drawback claims Green 4. Goods allowed to be exported as Pink duty-free ex-bond 5. Export goods which come under Blue DEPB Scheme Table 6.2: Colour Schemes  How Does Shipping Bill Process Work? A shipping bill is ready when the approval for carrying the commodities or goods from the country using a container or ship is granted. Once the bill is ready and submitted, the custom authorities will do physical check and also do the good’s valuation for the export. They verify these shipping bills and endorse the copy like ‘LET EXPORT ORDER’ and ‘LET SHIP ORDER.’  Procedure for Generation of Shipping Bill 116 CU IDOL SELF LEARNING MATERIAL (SLM)

i. The exporter needs to be registered with Customs using their IEC Code No. or Customs House Agents (CHA) license No. and Authorized Dealer Code No. of the bank. It helps the export to proceed. ii. A declaration form in a given format which is signed or attested by exporter or his authorised CHA has to be given or submitted at service centre along with an invoice copy and packing list. iii. The generation of checklist has been done after the completion of the data entry and the same has been handed over to the exporter. iv. After verification of the data, the exporter intimates the same to the service centre. v. After which the data has verified and corrected, it will be automatically process. vi. If the total valuation of goods exceeds ten lakhs rupees or have any free samples which worth exceeds Rs.20, 000 or whether drawback amount exceeding 1 lakh amount, it will get assessed by Asst. Commissioner (export). vii. The exporter would be able to check the bill status with service centre after the completing the process. viii. Sometimes the queries raised to an exporter can be able to file his reply with the help of service centres. ix. All original docs including the checklist which are related to the goods such as the invoice, pack list etc have to be submitted or provided at docks by the exporter. x. ‘Let Export Order’ will be issued once everything is okay by the proper officer. xi. Once the ‘Let Export Order’ has been issued, the printout of the shipping bill is ready. 117 CU IDOL SELF LEARNING MATERIAL (SLM)

Figure 6.3: Sample of Bill Format 6.5 CERTIFICATE OF ORIGIN A Certificate of Origin is a certificate that is used to identify the country of manufacturing of any goods or commodity. The Certificate of Origin carries many other points of information such as what the product are its destination and the countries of export. It acts as necessary document which requires for export or cross-border trades and contains trade treaties and trade agreements among the nations.  Who Can Issues a Certificate of Origin? This certificate is issued either from the Indian Chamber of Commerce or Trade promotion Council of India for the exporters in order to make sure that the goods traded are of Indian origin, whether these goods are completely manufactured with in India etc. In order to make smooth transactions in trading as well as in commerce, there are millions of such certificates are issued worldwide. It must be signed on an Indemnity bond having non-judicial stamp 118 CU IDOL SELF LEARNING MATERIAL (SLM)

paper worth of Rs.10 by the exporter which needs to be duly notarized. The format for such Indemnity Bond is made available along with the Certificate of Origin Dept. Also, this certificate should be signed and stamped by the Chamber of Commerce or any such authority having the same qualification. It acts as a document to prove from where the goods are being traded. Certificate of Origin - Its Importance Its main importance lies in custom clearing of goods. Whenever the goods which are meant for the import or export do not carry this certificate, customs office would not allow the goods to be shifted from the warehouse. It is used by the Customs officer which helps them to examine any duties levied on the goods and also to examine whether these are legal for the export or import.  Certificate of Origin Types: Certificate of Origin are of two types where Chambers of Commerce issue: i. Non-preferential Certificate of Origin: In this type, the goods which are supposed to export, or import are not having any type of tariff treatment and the due duties should levy on the goods which are being shifted. ii. Preferential Certificate of Origin: In this type, preferential consideration in tariff will be given to the good in the form of duties which result in normal tariff reduction or exemption of the tariffs. This type of situation happens when more than two nations go for the trade agreement which may results in exemptions during trading. 119 CU IDOL SELF LEARNING MATERIAL (SLM)

Figure 6.4: Certificate of Origin Sample 6.6 SUMMARY  The Export Procedure & Documentation is much important functional area of exporting business administration. It has several legal implications for meeting the various requirements of respective country where it would be exported.  There are various documents required to be prepared and submitted to the concerned authorities in the standard format from time to time. They all are integrated and clubbed under Alignment Documentation System.  Nowadays, the documents should be granted and submitted electronically or physically or both.  The Commercial invoices, shipping bills, certificates of origin are highly important documents for exporters to continue the operations abroad.  Foreign Trade (Development & Regulation) Act, 1992 and Export-Import (EXIM) Policy are the ones which regulates the export trading.  The primary body which governs the export and import policies in our country is Directorate General of Foreign Trade (DGFT). 120 CU IDOL SELF LEARNING MATERIAL (SLM)

 The exporter should meet the Reserve Bank of India (RBI) guidelines.  An exporter also requires an Import-Export Code Number has to be there with the exporter which is issued from the respective regional licensing authority. 6.7 KEYWORDS  Multitude: The high number of people/objects; on a large scale.  Freight Forwarding: The mode of shipping to move goods from one place to another.  Bill of Lading: An official receipt which contains all the information of the goods including its description, port destination etc.  Destination: The final place where the export products /services would be delivered at.  Proforma: A standard format /template to be used for certain documentation process. 6.8 LEARNING ACTIVITY 1. Write the procedure (steps) for generating of shipping bill. Stages of Geneation of Shippipng Bill 1- 2- 3- 4- 5- 6- 7- 2. Explain the notable differences of following Certificate of Origin . Preferential Certificate of Origin Non-Preferential Certificate of Origin ___________________________ ___________________________ ___________________________ ___________________________ ___________________________ ___________________________ 121 CU IDOL SELF LEARNING MATERIAL (SLM)

6.9 UNIT END QUESTIONS A. Descriptive Questions Short Questions 1. How to obtain the Export License? 2. Define the ‘Foreign Exchange Rate.’ 3. How to prepare the Order execution? 4. Explain the Bill of Lading in short. 5. Enlist the documents required for Commercial Invoice. Long Questions 1. Explain the nature, functions and objectives of Aligned Documentation System in detail. 2. Discuss the structure of International Trade Documentation and how does customs, exporters and importers prepare this documentation? 3. Compare and contrast the commercial invoice and Shipping Bill with the examples. 4. Explain the procedures for Pre-shipment and Post-Shipment activities. 5. Demonstrate the role and responsibilities of customs authorities in Aligned Documentation System in different scenarios in our country. B. Multiple Choice Questions 1. Exporter draws a Bill of Exchange based on _________________________. a) License b) The commercial invoice. c) Bill of Lading d) None of these 2. The Bill of Exchange with commercial invoice is called ___________________. a) Documentary Bill of Exchange. b) License c) Certificate of Origin d) Bill of Lading 3. The new Aligned Documentation System (ADS) was introduced in India in the year _______. a) 1990 b) 1991 c) 1992 122 CU IDOL SELF LEARNING MATERIAL (SLM)

d) 1995 4. The Indian Institute of Foreign Trade is located at ______________________. a) Mumbai b) Chennai c) Delhi d) Hyderabad 5. Among the 16 documents, __________ numbers have standardized and aligned with one another as per ADS at present. a) 14 b) 12 c) 15 d) 16 Answers: 1-b; 2-a; 3-b; 4-c; 5-a. 6.10 REFERENCES Textbooks  Singh, M. (2016). Export Import Business Guide: Learn export import business and become a leader. Create space Independent Publishing Platform.  Das, Gurcharan (2002). India Unbound. Anchor Books, Noida.  IMF REOAP (Various Issues). Regional Economic Outlook: Asia and Pacific. Washington, D.C. Reference Books  Kumar, Dharma (2005). The Cambridge Economic History of India, Volume II : c. 1757–2003. New Delhi: Orient Longman.  Panagariya, Arvind (2008). India: The Emerging Giant. Oxford University Press.  Alamgir, Jalal (2008). India's Open-Economy Policy. Routledge. Websites 123  https://www.trade.gov/common-export-documents  www.fao.org  http://www.etcweb.net/  https://www.maersk.com/ CU IDOL SELF LEARNING MATERIAL (SLM)

124 CU IDOL SELF LEARNING MATERIAL (SLM)

UNIT 7: EXPORT PROCEDURE & DOCUMENTATION Structure 7.0 Learning Objectives 7.1 Introduction 7.2 Consular Invoice 7.3 Mate’s Receipt 7.4 Bill of Lading 7.5 Marine Insurance Policies Types 7.6 Summary 7.7 Keywords 7.8 Learning Activity 7.9 Unit End Questions 7.10 References 7.0 LEARNING OBJECTIVES After studying the unit, the students will be able to:  Examine the consular invoice.  Analyse the Mate’s receipt.  Explain format bill of lading.  Discuss marine insurance policies types. 7.1 INTRODUCTION The formation of a suitable corporate structure and encouraging conditions ease the development of foreign commerce. The actual standard of economic growth in any growing nation such as India is the export growth index. It will only get advance through the favourable structure which is its basic goal. The management helps to safeguard the likes of consumers, acquire situations of rivalry and promote the corporate structure. The current managing structure in our nation is extremely encouraging. The government’s frame of mind towards the rapid step supports the structure to obtain the comfort development after moving the congestion, obstruction for the track of growth and improvement. 125 CU IDOL SELF LEARNING MATERIAL (SLM)

A bill wrapping the lading of products guaranteed by the ambassador of the nation for which the good is foreordained. It is a form recording lading of products and exhibit details such as the seller, collector, and worth of lading. It introduces the information of the deals as well as information about from where the products have transported and also testing the realness of lading information which contains seller, collector, worth of lading, etc. It also provides the details about the worth, lading character, its size, and the same get pre-validated. The major objective of the diplomatic bill is to license the command from gathering the right facts of the products concerning capacity, score, standard, origin, etc. in shipping nation and to evaluate buying responsibilities and for the motive of demography. It also helps to collect agents for proving these products containing the character of goods. Also, the export amount should be verified to certify that discarding has not taken place. The partner’s receiving form on which all the information given on the B/L are grounded; the facts or the details on both partner’s receipt and B/L must therefore be ordinary or similar. The partner’s receiving would not directly be the same from the ship or consigning record presenting when the material is purchased besides but would be assembled from a yacht’s or boat’s result or computation. It presents the right size and the situation of the material got. It further assists in guiding successful management in a larger process for the export project. 7.2 CONSULAR INVOICE The certificate or the bill is mostly used in Latin American countries, Uganda, Mauritius, Kenya, Tanzania, Myanmar, Australia, New Zealand, Nigeria, Iraq, Ghana, Fiji, Guinea, Cyprus, Zanzibar, etc. is known as the consular invoice. This is the most dominant one which has to be reported to the Importing country’s Embassy in sequence to have the documentation. In the consular invoice, several details regarding the importing products such as amount, score, capacity, size, origin, etc. are revealed and therefore support the management of the importing nation to examine the import responsibilities as well for the objective of demography. But few importing nations recommend and demand to have the authentication in the consular invoice from the consular of the importing nation which is located in the exporting nation. In demand to have this bill or documentation, some value as the fee has to be deposited by the exporter, and these fees may range in other nations. Its major objective of getting a consular bill is to obtain attestation of the facts available in the bill. The importer will have an enormous comfort when he gets the signed bill by the consular as the details provided in it such as its origin, standard, score, and capacity should be actual and attested. It is very essential to satisfy the importing nation’s collecting agents about the products imported are the same as provided in the bill. If not, they will check the product’s parcel which will postpone the delivery and hence disturb the importer. Therefore, to have the freedom from all these issues, the importer demands the particular exporter to give a bill, 126 CU IDOL SELF LEARNING MATERIAL (SLM)

which is the consular invoice, from the exporter’s nation consulate. This consulate invoice has three copies. Out of these, the first copy is kept by the consulate officer, the second copy is with importing nation’s agents and the third copy will be kept by the exporter which will be useful to bargain or collect in the bank. This detail is also useful in accounting for the import responsibilities and is helpful for the objective of demography. For obtaining the consular invoice, the exporter must deposit three-bill printouts to the related importing nation’s consulate, and against that, they verify the bill settling the payment. One printout is provided to the exporter while the other two printouts are given to the importing nations collecting agents for accounting for the importing duties. Accounting for the consular invoice and other shipping certificates, the exporter can bargain with the importer. The exporter bargains a printout of the consular invoice to the importer.  Consular Invoice – Its significance It can be identified as below: i. Its significance towards the Exporter a. It is termed as that if the bill has been signed by the importing nation’s consulate, it provides a promise to the exporter about the insignificance of import limitations in the nation of the importer. Also, there will be no issues remain on foreign exchange. b. It provides a guaranteed custom free from the exporter’s nation for communicating the products. ii. Its significance towards the Importer a. Outstanding consular invoice assist the customs from restrains unpacking in the importing nations and hence delivering the products quicker. b. It assists in ignoring huge difficulties in unpacking for the importer. iii. Its significance towards the Customs a. Consular invoice assists the collecting agents of Exporting nation from quick delivery of the products. b. It assists the collecting agents to impose huge import duties despite unpacking the goods. 127 CU IDOL SELF LEARNING MATERIAL (SLM)

Figure 7.1: Consular Invoice – Format 7.3 MATE’S RECEIPT A mate’s receipt is termed as a receipt that is released and underwritten by the freight ship’s captain, for goods loaded on the board. It should be a dare in practically few of accustomed business such as containership or drought or the freight but would be removed along the routes like ro-ro shipping and container with various new certificates defined by Standard Shipping Note. It is the certificate with numerous aspects shown on the B/L are origin; the details showing on mate’s receipt and bill of lading should be same. The mate’s receipt should not be cheated from the shipping note displayed when the goods are purchased with them but must be accumulated from the ship’s counter or computation and present the same size and the situation of the goods as arrived. When the situation of freight size explains it, then it should be validated with comments such as “torn bags”, “stained bales”, “rusty drums”, etc. and must, where the vessels and vessel’s counter does not agree, be drawn from the little statistic, with the clause “X other (drums) in debate; if on-board to be carried”, “X being the variance within the counters”. It will commonly be on the vessel owner’s document, in a triple book or pad kept on board. The basic should be handed over to the carrying individual to the cargo or the yacht, a duplicate should handover to the officer, and a second duplicate should be kept in the cargo 128 CU IDOL SELF LEARNING MATERIAL (SLM)

record for tallying with B/L before underwriting, and for matching with the products or the shipping plan. It is not accounted as a form of title to the products, or the goods shipped and should not pass any heading by its transport or the approval levied. In ports and trades where mate’s receipts are helpful, the captain should show the underwritten mate’s receipt to the officer in view to be set with the underwritten bundle of original bills of lading before putting the ship into the sea.  Duties of Mate’s Receipt Safeguarding Request Commodities or parcels which are landed in a bad state could not be re-delivered. Therefore, it should be handled with care while boarding the good in the ship to prevent tampering, damage, spillage, brokerage, leakage, stain, and to protect from tearing. Till the time all the refurbishing does not take place, these parcels should not be accepted. We should be careful regarding the ship which is carrying Mate’s receipt and returning to the port, should carry parcels too. It is extended for those products which are landed on the port and have been handed over to the assigned person for issuing the B/L. The mate’s receipts are the cargo owner’s first line of protection in protecting a ship’s claim for destroying. The receipts must be true and show the size and ship situation which is landed on the port. Where the working officer of the cargo can calculate the amount received on land will not be the same from the persons’ or cargos’ counting. The minimum size should be declared on the receipt and conditioned disclosed, for instance, “28,750 packages being landed on the port. 350 packages in controversy, to be handed over if traced on the port at discharge”. It is not very easy to scrutiny the ship size landed in a bulk carrier, majorly it is highly difficult for the chief to handle the order survey for tallying along with the vessel’s data. For example, the cargo can be stuffed at the harbour, where the environment and the sea situation would make the survey incorrect. By validating the Mate receipt which represents the volume, cargo’s data, size, standard, fulfilment, amount, and situation to the cargo owner. A portion, possible treatment may be for the cargo’s design and ship’s approach to be locked and guaranteed by the individual surveyor assigned by the owner. P&I club. At the release point, the surveyor has to be available in the state to validate that the packages sealed are not being destroyed before opening the parcel. The surveyor has been organized by the collectors or the salvor to handle this act. Whereas the chief must track the points of the task at the releasing point in the note pad available on the dock. His certificate to the officer for underwriting the bills of lading on his part should declare that they are to be provided in precisely on the Mate’s receipt. 129 CU IDOL SELF LEARNING MATERIAL (SLM)

However, when the parcel or ship lands on the harbour in a bad state, it should not be accepted. Underwriting the Mate’s receipt in such a destroyed condition is cheating. It is comparatively better to refuse the sealed parcel or ship when dampening or any cascade etc. But this is not feasible as there are few working individuals and stuffed with goods in the cargo. Frequently, it is not feasible to scrutiny the state of products within the parcel. For example, wheat may get infested, tea may get spoiled, etc. Rather the working officers of the cargo can take caution in all this stuff and if any damage discovers, it should bring in the notice to the salvor or the collectors. The Mate’s receipt must be underwritten in goodwill and should be validated “situations, fulfilments, standard, and amount attached”.  Cargo tallying Now for accounting while unlading and lading of huge parcels or ships is very tough for the cargo officers in an effective way except few normal packets such as nuggets or posts. There will be additional officers engaged as counting staff apart from the cargo officers for completing the same in some of the harbours for protecting self from any shortfall declare. But this involvement of additional officers may not be ideal or efficient in some administration region and the chief has to guarantee the perfect act which is to be pursued in a special area after taking permission of his P&I club. If these accounting officers are doing the job with the ship’s owner and the captain, their receipts can be trusted rather than Mate’s receipt and the job perfection of accounting officers will be completed with the help of clerks available at that time of the cargo or the ship. The vessel’s counting must be recording on lading and unlading and not landwards or in an easier as the cargo’s responsibility starts and stops when the ship proceeds over the vessel’s rail. This data from the counting must be recorded exactly on board for any protection instead of demand against the cargo or the vessel. Mate’s receipt is termed as a receipt that is published by the captain of the cargo before loading the goods. It is transparent that it is handed over before the loading period starts. Mate’s receipt is provided to the Port Trust Authorities. After settling all the bills due to the port, the customs officer receives the Mate’s receipt from Port Trust Authorities. Mate’s receipt is fully transferable. This receipt must be handed over to the cargo authorities for collecting the bill of lading in the barter. Bill of lading is made on the account of the Mate’s receipt. Mate’s receipt is not a certificate of title of goods. It is a receipt of products. But it is a very important form that its non- availability does obstruct the exporter from accepting the goods title form, which is, the bill of lading. Type of Mate’s Receipts 130 CU IDOL SELF LEARNING MATERIAL (SLM)

i. Clean Mate’s Receipt: If the stuffing of the ship or its parcel in the cargo looks or is packed well, then the chief officer presents a receipt, and it is termed as Clean Mate’s Receipt. ii. Qualified Mate’s Receipt: When the stuffing of the commodities in the cargo is discovered not good and unsatisfactory, then the chief officer presents a receipt, and it is termed as qualified Mate’s receipt. It will also be generated despite if the shipping company might not accept any guarantee for the destroy taken place during the transportation.  Fulfilment given in the Mate’s Receipt i. Freight strand trademark and its title. ii. Carrier’s location and its title. iii. Cargo title and its size. iv. Freight harbour information. v. Unloading harbour and its dispatch information. vi. Score and the count for the container. vii. Information regarding parcel in the container and its description. viii. Total count of parcels and the total count of containers: Goods information is emphasized on its standard. ix. Container level and its seal count. x. Gross or total weightage in kilogram and its capacity in cubic meters: Shipping invoice number and the invoice date. xi. Commanding head’s underwriting and abbreviation.  Significance of Male’s Receipt i. It provides an acceptance of the products or the goods which are collected for the export on loading the cargo or the ship. ii. This receipt is freely moveable. For having the B/L, this receipt must be provided to the shipping company. iii. B/L, studied as the name of the commodities, will be built out of mate’s receipt. iv. It assists the exporter in paying the dues in the Port Trust Authorities. Mate’s receipt is termed as a form that is utilized in the vessel shipment. This is generated mainly by cargo or its officer when the goods are accepted. It provides the initial image of the goods that are being accepted and the ledger describing it helps in understanding the size of the goods, and underwriting, and relevant state. That can be obvious from the signs we discover during collecting time. The total or the number can be done by comparing and the receipt from the comparing officer will be fixed with the mate’s receipt. These details are very crucial as they will be used for generating B/L. The B/L helps generate “in honour” or “in uniformity” with the mate’s receipts and/or the comparing officer’s receipt. 131 CU IDOL SELF LEARNING MATERIAL (SLM)

Many times, the form that is generated by the officer of the freight submits the action of the mate’s receipt but is defined as “dock receipt”. It is named after the receipt being underwritten by the initial mate in the cargo. But afterward, it is also signed by the officers of the cargo. The facts shown on the mate’s receipt are tallied with the figures and goods information shared by the salvor. Though the mate’s receipt is a receipt for goods and proof of its standard, identity, and state, it is not a document of title. It does not provide the holder the identical rights. Figure 7.2: Mate’s Receipt – Sample 7.4 BILL OF LADING The word “bill” is being defined as a document describing the amount and value of the goods and services rendered or delivered. The word “lade” in literal terms identifies as the place where the goods and the commodities being shipped on the freight. Therefore, the B/L provides the ledger detailing the goods being collected on the freight for transport. Also, it studies as an invoice which behaves like a bond between the company and the salvor which is helpful in trading. This freight or the trading companies will generate this B/L to the shipper. 132 CU IDOL SELF LEARNING MATERIAL (SLM)

The goods or the products might be assigned to the sequence of the exporter. It describes that the assignments or the commodities can be collected by anyone that the exporter assigns. In that case, the exporter would have to release the B/L on its backside. When the bank bargains regarding the bill of lading, it would be validated in the name of the bank that would further validate to the importer, on the receipt of the payment. B/L is generated with 2 sets underwritten in the original. The shipping company also generates non-negotiable prints (not certified) which are not considered as a document of title of goods but kept in a file for records. The backside of B/L should mention the Terms and conditions of the freight bond. The terms are mostly the same in all the B/L. A Bill of lading must be transparent in terms of encouraging the exporter to go ahead with the procedure easily.  Main Purposes The main purposes have been stated below: i. For getting certificate of title of goods. ii. For getting receipt from the shipping company. iii. As bond of consignment for the freight trading.  Different classification of B/L i. Collection of Shipment B/L: This category of B/L has been generated to the shipping company only when the goods are under the charge of the shipping company before boarding. ii. On-Board Shipped B/L: This category of B/L assists the company in verifying and certifying the freight carrying in the ship on board. iii. Clean B/L: This B/L describes that there must not be any kind of fault in the commodities at the time of collecting or before boarding by the shipping company and hence it gives a clear view, therefore, defines as clean B/L. iv. Clause or Dirty B/L: This category of B/L defines as if this B/L is being generated then the goods might be destroyed or damaged and mainly expresses as “bale number 5 hook-damaged” or “package number 10 broken”. If the shipping company has discovered this receipt, they would restrict their duties to be performed at the delivery location. A note should be taken that the bank will only accept the clean B/L during the negotiation time. v. Trans-shipment or Through B/L: This category of B/L is generated when the transport company has several modes of transport like water, rail, road, air, etc. from the starting location till the destination and hence defined that this shipment could be en-route. vi. Stale B/L: Following international commercial practice, B/L attached with other certificates should be submitted to the bank not exceeding twenty-one days from the date of shipment as mentioned in the B/L. The exporter should obey the 133 CU IDOL SELF LEARNING MATERIAL (SLM)

preconditions stated. In other words, it is not feasible for the bank to identify the certificates before the cargo, or the consignment may reach the destination. vii. To order B/L: This category of B/L is being generated indicating the order of a specified person. viii. Charter party B/L: This category of B/L is generated when the goods are being transported on the chartered ship. ix. Freight paid B/L: This category of B/L is generated to the shipper when he settles the cost of the freight and therefore it mentions “Freight paid”. x. Freight collect B/L: This category of B/L is generated when the shipper is not paid the freight but not been taken at the destined location, then Freight collect B/L would be generated and hence marked as “Freight Collect”. Since the commodities might destroy during transit, the importer could demand “clean B/L” or “clean on-board shipped B/L”. If transit has taken place during the time of the journey, it may be delayed. Though the B/L is a certificate that is non-negotiable but still it is transferable. It assists the exporter in claiming the value from the bank even though the commodities have not reached the destined location. Parties declared in B/L: In this bill, three crucial columns being discussed as Consignee, Consigner, and a command from the communicating party. The communicating party is that party to whom the notice about the arrival of goods, at the mentioned location, is being delivered. When the B/L is designed to the command of, the person, in whose name it is generated to the command of, has the authority to validate further. To illustrate - Consigner: Cherry Blossom and Company, Bhopal consignee or to the order of: Tweety and company, Singapore. Notifying Bank: Yes Bank, Singapore. For instance, Tweety and company have full authority as a consignee on the commodities or the freight and further Cherry Blossom and company should not be able to move the title of goods to the third party. In-state, the bill is not yet settled against the goods, the consignor may lose the title of goods and hence B/L might not generate. Suppose the consignee has settled the bill, then he can demand as must be having a negotiable copy of B/L. Otherwise, the consignor can only demand and collect the amount of the goods.  Bill of lading – Its contents i. The consignee’s title and its location. ii. The freight’s title and its location. iii. Boarding harbour title. iv. The boarding date of the commodities. v. Destination harbour title and delivery location. vi. Size, score, standard, and other information. vii. Size of the parcel. 134 CU IDOL SELF LEARNING MATERIAL (SLM)

viii. Freight value settled or payable. ix. Size of generated originals. x. The shipping company title. xi. Date and days of the journey. xii. Underwriting of the issuing officer. Figure 7.3: Bill of Lading - Sample  The Importance of Bills of Lading It is not essential to provide all the original documents for the goods to be deposit before final delivery. Therefore, the exporters have the access to all the original documents despite bills of exchange or payments or other assurance payments are done. Moreover, the bill of lading is most essential at the time of goods transit or freight carriage. Hence, it is useful in two ways, one as a bond between the consignee 135 CU IDOL SELF LEARNING MATERIAL (SLM)

and the freight carrier company and second as a receipt generated by the cargo company to the shipper company. Therefore, B/L could be described as a legal certificate that provides all the essential information to the freight and the consignee for proceeding with the carriage through many countries. The original B/L printout must be handover to the cargo, and a duplicate of it should also be handover to packaged freight. A blank bill of lading template is available from this link: https://templatelab.com/bill-of-lading/  Negotiable and Non-Negotiable Bill of Lading A Negotiable Bill of Lading: This bill helps deliver goods and commodities to the concerned party carrying the original Negotiable bill of lading. It chooses the power and the title of the carrier. Now at the harbour where the goods are delivered, the consignee or the buyer or collecting agent has to show the original bill of lading to the carriage without which the goods and the commodities will not be handover or released to the party. A Non-Negotiable Bill of Lading: This bill helps deliver goods and commodities to a particular receiver or a collector at a particular location decided before. With the help of this bill, he cannot claim the goods, but by disclosing his identity he can claim the goods.  Purpose of Bill of Lading The bill of lading certifies that the carriage document validates as the evidence of the bond of freight of the goods or the commodities. A B/L is negotiable which carries several legal obligations describing here. It presents evidence for the freight bond which carries terms and conditions against which transit of goods and commodities initiates. It characterizes as a receipt that validates that the cargo or the ship has collected the goods in proportion to the bond and the goods that are collected are in a good state. This form permits the sale of commodities across the world and for lifting the financial credit. The B/L might not characterize as a document of title in the neighbourhood as well as international organizations. The Bill of lading provides the discharge power to the beneficiary.  Types of Bill of Lading Corresponding to the implementation technique and its functions, the bill of lading can be separated as below: i. Based on Execution Method a) Straight Bill of Lading: It describes that the goods and the commodities are only being dispatched for a particular consignee which is non- 136 CU IDOL SELF LEARNING MATERIAL (SLM)

negotiable under any prevailing circumstances. It also defines that the consignee does have more power than that of a consignor. This category of the bill may also be defined as a non-negotiable bill of lading. It should also be clear to all that this type is not considered safe from banker’s view and used for military cargo. b) Open Bill of Lading: It describes this bill as moveable and the consignee’s name can be changed with the consignee’s signature. It can be transferred as many times as possible. This can also be termed as a switch bill of lading. ii. Switch bill of lading a) Bearer Bill of Lading: This bill talks about those who are qualified for the delivery. It can be formed categorically by the bank or it is a demand invoice that fails to propose the consignee whether it is an original document or being validated by the bank. It could be negotiated by delivering goods in person and best help for the big carriage which will charge in a small amount. b) Order Bill of Lading: This bill helps in describing properly to negotiate with the party. It states that delivery must take place only after the consignee demands using the words like “deliver to Cherry India Ltd.”. These goods and commodities will only be delivered to an authentic B/L party and the officer who is delivering the goods also check the B/L and confirms. The order bill of lading:  Can be defined as a new type of bill and is highly used across the world.  Need to take care that the goods or commodities are delivered safely to an authorized B/L owner.  In other countries, there might be people with a different procedure, language, and customs. Consignor might find little difficulty in delivering the goods. There could be people who may try to collect goods or commodities illegally. In accordance to avoid these frauds, the consignee should represent the B/L to the customs office of the ship at the delivery port who properly checks the bill of lading. And thereafter when the officers reassure, he will give a delivery order and gives back the verified B/L. After sharing the B/L and genuine delivery papers, any person can receive the goods from the cargo. 137 CU IDOL SELF LEARNING MATERIAL (SLM)

Figure 7.4: Switch Bill of Lading As the bill of lading is issued to “to order” of the shipper, it is a negotiable document of title. It states that the possession can be transferred to any other person using the authorized signature. There are two categories of the commodities where payment is made later on and delivery takes place under the label “To Order”. To Order, Blank Endorsed: This bill is not issued in the name of any party but “To order” of the consigner, intentionally – consignee name below the “notify party”. Its title can only be filled when the consignor stamps and underwrite on the bill of lading. To Order, Bank: This bill is consigned to a bank intentionally with the consignee’s name mentioned below the “notify party”. The bank validates the bill of laden to the specified party along with the payment of (or to promise for paying) the outstanding payment of an attached bill of exchange. “To Order” bills of laden are usually helped in credit transactions 138 CU IDOL SELF LEARNING MATERIAL (SLM)

documents and further may be sold, bought, or traded, or could be kept as security to borrow funds from lenders or bankers.  Corresponding to Technique of Operation Collected for Shipment Bill of Lading: This bill confirms that the carriage collected the commodities. But it is not written that they are on-board with any specific cargo and finally, dispatched from officer/solver to the consignee. Shipped Bill of Lading: It is generated when freight or commodities are boarded on cargo and it generates a contract with the captain of the ship and the consignee. A Clean Bill of Lading: It states that the commodities have been boarded on the cargo or ship in a clean and good state. It could not help in assuring whether goods will be in good condition in transit while going through different countries due to weather change. The word soiled bill of lading is nothing but the opposite of it, which states that the commodities or shipments were collected by the officer and were in a good state. Through Bill of Lading: It is a legal certificate in which delivery takes place from one location to another location directly. It permits shipping for the national and international freight as it has a receipt with all the information about the ship, freight bond, and many times goods title also. Combined Transport Bill of Lading: It provides the fact about the carriage being shipped In Huge Containers by Sea and Roads, Respectively. I.E., Multi-Model Transportation. Dirty Bill of Lading: Considering the state of freight-carrying commodities does not seems to be good, then at that time the owner can add query A blank endorsement on a bill of lading indicates the seller has not specified a recipient or buyer for the goods. If a seller or exporter does not have a buyer for their goods at the time of shipment, they can indicate \"to order\" or \"to order of\" in the consignee section of the bill of lading regarding the state by submitting the clause covering this and therefore, the bill of lading shifts to “Dirty bill of lading” originated on the conditions showing about commodities as damage cargo, leaking package, torn cartons, shortage in the total number of goods, etc. Sets of Bill of Lading: To promote goods and commodities to reach the destination at the given time although the original invoice is misplaced, therefore, there must be a habit to keep 3 sets of invoices sign. These three originals are described as the first original, the second original, and the third original at its uppermost for recognition. Along with it a duplicate print of the “non-negotiable” document should be kept stamped. These original bills of lading must be underwritten by the chief and if the officer signs these originals then there is no 139 CU IDOL SELF LEARNING MATERIAL (SLM)

need for other copies. This clause must be mentioned on the three original copies of B/L. This is the main reason that bank demands these three sets of original copies before negotiating the letter of credit which takes care of goods or freight. This assists in obstructing the claim initiated by other officers who carry the B/L before the bank does. Bill of Lading as Bond of Carriage The bill of lading is generated after the bond is signed between the owner and the shipper. This contract is issued at the time of goods being loaded on the cargo. This bond is useful for the carrier if commodities or the vessel gets destroyed at the time of loading on the cargo or to the ship and therefore, can be used at the time of claiming. Hence, the bill of lading should be considered as the original bond between the owner and the carrier. The basic rules and conditions covered in the bond of freight of goods transporting through sea are Rotterdam Rules, US CGSA, Hamburg Rules, Hague Rules, and Hague – Visby Rules. These rules considering the freight bond will be written on the first page of B/L. At the time of booking of the shipment by the consignee, the shipper will give an endorsement where all the clauses are written by the carrier. Also, he writes all the terms and conditions considering the bond and booking of the carriage.  Contents of Freight Bill of Lading The bill of lading comprises the following details: i. The complete title and location of the consignee and the carrier. ii. The purchase orders or specific counts or bill number that assists the carrier and the receiver to dispatch the commodities for collecting or accepting at delivery. iii. The date of collecting it will help in tracking the freight. iv. The information of the goods describing the count of units as shipper, capacity, and size of the package, along with the nature of cargo being carried. v. If the goods are hazardous, they must be informed on the invoice and hence easy to identify to follow special rules and requirements when shipping. vi. The information about parcels used such as palates, pills, crates, cartons, drums, etc. vii. Any special notes or instructions for the carrier.  Bill of Lading Tracking Different companies use different forms of bill of lading which makes it difficult to track them unless a specific tracking service is provided by the carrier. There are few companies that tie-up with the shipping carriers to track the bill of lading for easy trade. 140 CU IDOL SELF LEARNING MATERIAL (SLM)

7.5 TYPES OF MARINE INSURANCE POLICIES Marine Insurance is a very wide and encompassing subject that can be categorized into many policies with marine insurance as one of them. As per the needs and specifications of the transporter, an appropriate type of policy can be narrowed down and selected for operation. To manage the risk involved, several types of marine insurance are designed for the owners and the carriage. It is designed very nicely for the clients’ benefits also. Depending on the capacity and companies’ business nature, one can choose the appropriate plans which may give good profits. It can cover several risks faced by the owners of the ship, freight owners, and many other companies involved in the shipping business and terminal handlers. But various unfavourable conditions affect the vessel such as bad weather, pirate attack, navigation issues, therefore, it is wise to choose suitable and appropriate insurance as per the risk involved in the transportation of goods. This policy also covers third-party insurance as they may directly or indirectly involved. Therefore, depending on the requirement one can choose from the various marine insurance policies as listed below: Marine Insurance and Its Type The companies should have full knowledge regarding the types of insurance available that suits the nature of the business. The different types of Marine insurance are: Hull and Machinery Insurance: It is well known that the hull of the ship is the most notable structural entity of ship. To define the hull, it can be said that it is the watertight enclosure of the ship, which protects the cargo, machinery, and accommodation spaces of the ship from weather, flooding, and structural damage. Therefore, any damage or mishap to the hull is covered under this insurance. This insurance is opted for by all the owners of the ship. Along with-it owners also take machinery insurance as it is also considered as a major part of the ship. Under machinery insurance, any damage to the electrical part, mechanical part, or operational part is also covered. Therefore, these two insurances cover all the important parts of the ship and hence, being opted by all the shipping companies. Marine Cargo Insurance: Many times, mishandled cargo at the harbour or during transit is borne by the owner of the ship, therefore, he has to bear all the types of risk involved in it. The types of risk include loss of goods, damage, or misplace items. That may cause a great financial loss to the owner of the ship. In order, to safeguard from all such risks, marine cargo insurance is being opted for by the owners of the ship. It also brings the third-party liability insurance which will cover the damages happens to the harbour, ships, railway tracks, other cargo/goods or human. Liability Insurance: Huge damages can take place to the expensive cargo or goods such as crash, pirate attack, or collision. Also, the life of the staff working on it is at risk. Therefore, 141 CU IDOL SELF LEARNING MATERIAL (SLM)

this insurance helps in covering all the unpredictable risks involved along with-it during transit. Freight Insurance: The loss of freight covers under this insurance. It means the owner of the ship may not want to bear the loss that could happen to freight or ship such as loss or damage. Hence, this insurance covers all these types of losses. What it all cover? The movement of the cargo or ships cannot be similar for all the customers. Therefore, the requirements of the insurance may not be similar for the customer during transit under different conditions prevailing. Below is the list of points covered under the section of marine insurance:  During a fire, cargo sinking, blast, and shipwrecking times.  While loading and unloading the vessel, losses occurred.  Insurance covering for the total loss.  At the time of lightning or Earthquake occurring.  At the time of unforeseen expenses of administration.  Jettison or washing overboard.  During derailment, Collision, accident, and overturning.  During natural calamities.  General average. The different types of marine insurance policies are detailed below:  Voyage Policy: A voyage policy is that kind of marine insurance policy which is valid for a particular voyage.  Time Policy: A marine insurance policy that is valid for a specified period – generally valid for a year – is classified as a time policy.  Mixed Policy: A marine insurance policy that offers a client the benefit of both time and voyage policy is recognized as a mixed policy. This policy helps in handling different uncertainties during the voyage as well as within the vessels and also provides flexibility.  Single Vessel Policy: This policy is suitable for small shipowner having only one ship or having one ship in different fleets. It covers the risk of one vessel of the insured. For those having fleet of ships, this policy will be costing them.  Fleet Policy: In this policy, several ships belonging to one owner are insured under the same policy.  Floating Policy: A marine insurance policy where only the amount of claim is specified and all other details are omitted till the time the ship embarks on its journey, is known as a floating policy. For clients who undertake frequent trips of cargo 142 CU IDOL SELF LEARNING MATERIAL (SLM)

transportation through waters, this is the most ideal and feasible marine insurance policy.  Unvalued Policy: In this type of marine insurance policy, the value of the cargo and consignment is not put down in the policy beforehand. Therefore, reimbursement is done only after the loss of the cargo and consignment is inspected and valued. This is also known as the open policy.  Valued Policy: A valued marine insurance policy is the opposite of an open marine insurance policy. In this type of policy, the value of the cargo and consignment is ascertained and is mentioned in the policy document beforehand thus making clear the value of the reimbursements in case of any loss to the cargo and consignment.  Block Policy: This policy also comes under maritime insurance to protects the cargo owner against damage or loss of cargo in all modes of transport through which his/her cargo is carried i.e., covering all the risks of rail, road, and sea transport. 7.6 SUMMARY  The export business association is fundamental and essential from a documentation point of view.  There are legal, financial, and administrative tools involved in serving the importer, exporter, and also to government agencies.  The consular invoice, mate’s receipts, and bill of lading are highly important to export the products and also the services to foreign countries.  The Scope of Marine insurance is very helpful in meeting the contractual obligations of exports. The exporter must have the marine insurance policy for aligning such agreements as cost insurance and freight (CIF) or carriage and insurance paid (CIP), to have protection from the buyer’s or even from their bank’s interest and honour the obligation towards the contract.  Also, for the case of Delivered Duty Unpaid (DDU) and the case of Delivered Duty Paid (DDP), the seller may not be advised to ensure the commodities or the goods but generally happens.  There is a total of 19 varieties of insurance policies that ensure the different types of risks which are associated with the export activities.  Bill of lading is defined as a document that acknowledges the receipt of goods or cargo which are on board and is issued by the shipping company or by his agent. It also made me understand that these goods should be delivered in the order prescribed as well as the same condition during the receiving time to the consignee or agents after the freight receipt.  The B/L is also important because it has the document of title of goods and must be useful for the exporter. Bill of lading is unique for any shipping company. The Bill of 143 CU IDOL SELF LEARNING MATERIAL (SLM)

lading is being prepared by the exporter using the form which is obtained from the shipping company or their agents.  All the risks including the pirate attacks, extreme weather, navigation problems that are being faced by cargo owners, ship owners, terminal handlers, and also by different intermediaries in the export business are being covered in marine insurance. 7.7 KEYWORDS  Invoice: Information about the volume, value, quality, grade, source, etc., of the goods.  Cargo Tallying: Checking/Verifying the records of all cargo loaded into or discharged from the vessel.  Vessel: A large boat used for transportation of goods via sea.  Dock Receipt: A document proving that goods have arrived at a port.  Transhipment: Moving a container from one vessel to another while in transit to its final destination. 7.8 LEARNING ACTIVITY 1.Enumerate the covers provided under the Marine Insurance policies. ---------------------------------------------------------------------------------------------------------------- ---------------------------------------------------------------------------------------------------------------- 2.Prepare the list of contents for the freight bill of lading. ------------------------------------------------------------------------------------------------------------ ------------------------------------------------------------------------------------------------------------ 7.9 UNIT END QUESTIONS A. Descriptive Questions Short Questions 1. Which countries need the Consular Invoice? 2. What is the importance of invoice to the importer? Give example. 3. Define ‘Cargo Tallying.’ 4. Signify the role of Mate's Receipt in short. 5. Explain the objectives of Bill of Lading. Long Questions 1. Define the Bill of Lading and explain the types with examples in detail. 2. Illustrate the Consular Invoice use for the importer, exporter and custom authorities in different scenarios. 144 CU IDOL SELF LEARNING MATERIAL (SLM)

3. “Mate's receipt is useful in defending claims.” Justify with examples. 4. Prepare the sample of Mate’s Receipt based on points you studied for Agricultural Export Products. 5. Draft the Bill of Lading covering the key elements as discussed in the text. B. Multiple Choice Based Questions 1. Which of the following terms / rules are used under ‘the contract of carriage’ for carrying goods by sea? a) Hamburg Rules b) Rotterdam Rules c) Hague – Visby Rules d) All of these 2. ____________________ insurance covers the risks faced by ship owners, cargo owners, terminal handlers and various intermediaries in the shipping business. a) International b) Marine c) Trade d) None of these 3. __________________ insurance is covering the applicant from any mishap to the ship. a) Cargo b) Liability c) Hull d) Freight 4. The damage of goods, loss of ship can be covered under _______________ insurance. a) Freight b) Cargo c) Hull d) Liability 5. When the ship is exposed to crash, collision or piracy attack, _____________ insurance can help to recover the losses. a) Liability b) Freight c) Cargo d) Hull Answers: 1-(d); 2-(b); 3-(c); 4-(a); 5-(a). 145 CU IDOL SELF LEARNING MATERIAL (SLM)

7.10 REFERENCES Textbooks  Somani, J. (2016). Export-Import Management with Global Marketing. Himalaya Publication.  Kunal Sen. (2008). International Trade and Manufacturing Employment Outcomes in India: A comparative study, Journal of Management, Vol. 9(11).  WTO. (2009). Research and Analysis.  Seyoum, B. (2009). Export-Import Theory, Practices, and Procedures. Taylor & Francis. Reference Books  Singh, M. (2016). Modern Global Export Marketing Methods: Web, digital & social media. Create space Independent Publishing Platform.  John, K. C.; Kevin, S (2004). Traditional Exports of India: Performance and Prospects. Delhi: New Century Publications. p. 59. ISBN 81-7708-062-8.  Ford, D., (1997). Understanding Business Markets: Interactions, Relationships and Networks, The International Marketing and Purchasing Group (IMP), The Dryden Press. Websites  https://niesbud.nic.in  www.vskills.in  www.enterpreneur.com  www.indiantradeportal.com 146 CU IDOL SELF LEARNING MATERIAL (SLM)

UNIT 8: EXPORT PROCEDURE & DOCUMENTATION Structure 8.0 Learning Objectives 8.1 Introduction 8.2 Steps in Export Procedure 8.3 Export Contract 8.4 Forward Cover 8.5 Export Finance 8.6 Institutional framework for Export Finance 8.7 Excise Clearance 8.8 Pre-shipment Inspection 8.9 Summary 8.10 Keywords 8.11 Learning Activity 8.12 Unit End Questions 8.13 References 8.0 LEARNING OBJECTIVES After studying this unit, student will be able to:  Describe the systematic flow of the ‘Export Procedure’.  Examine the ‘Export Contract’.  Articulate the ‘Forward Cover’.  Elaborate the ‘Export Finance’.  Outline the institutional framework for export finance.  Explain pre-shipment inspection. 147 CU IDOL SELF LEARNING MATERIAL (SLM)

8.1 INTRODUCTION Documentation serves a significant role in bringing about the processes of Exports and Imports. The significance is more visible in the arena of Imports. Here, the efficaciousness of the process of Customs Clearance is determined by the presence of relevant documents, and the accuracy of the content in the available in the same documents. Even the submission of documents in alignment of stated deadlines, and the appropriate filing of requisite applications related to Customs Clearance, are important. In case, there is a delay in acquiring the necessary documents or in filing them, the importer faces losses. He may no longer have access to good opportunities in his line of business. He may also have to sustain demurrage in connection with the cargo being imported. The Customs Clearance department requests a specific group of documents from various people. These people include the importer and other people associated with him. There is the Clearing Agent, who prepares and submits the documentation for the Customs department. Similarly, there is the specific Freight Forwarder, the airline, or the shipping line. The importer has to ensure that any of the above-mentioned documents, the packing list, and the commercial invoice reach the Customs Clearance department. The selected documents should be in alignment with the importer’s chosen method of transport. If you are starting export- import business, then you need to be well aware all of the import and export procedure(s) and documentation. Knowing import and export procedure(s) and documentation is critical if you want all runs smoothly without surprises. It is important to know import and export procedure(s), so one can plan and prepare all the actions in the right order. It is equally important to have knowledge of documentation. In case, there are errors in the preparation of documents or presentation of incorrect papers, the business owner may not be able to import or export. Export procedure(s) or import procedure(s) are directly connected with documentation. Because anyone who wishes to export needs to provide or fill the documents required for export. Every procedure or process is related to some kinds of documents. Failing to provide the documents or failing to perform some export procedures might cause serious problems and costs. The Export Procedure(s) is significant stage in the overall process. Entrepreneurs should adhere to the following export and import procedures, for they are extremely important. It does not matter if the entrepreneur is importing/exporting. It does not matter if an import- export agent or an import/export company is involved. It is essential to have a consultation with the concerned country’s authorities and institutions, prior to setting up any company. At the outset, it becomes necessary to fill in the details in some forms. The details pertain to full names, addresses, contact, etc. Additionally, the government of the concerned country demands certain fees for granting permission for setting up a company. Only when 148 CU IDOL SELF LEARNING MATERIAL (SLM)

everything turns out to be satisfactory, it becomes possible to set up a company. The local bank also plays a role, in that it ties up with the concerned company for launching a company bank account. It would be good to make it an international account, for the company might have to deal with transactions across the globe. This is possible via the filling in of various documents. It would be good for the business owner to show the outline of a business plan to the bank too, such that the bank also gains a fair idea about the new commercial enterprise’s future activities. After completing the above-mentioned steps, the company’s owner should send in an application for a business license. Here, the business deals with importing or exporting of goods. The license goes by the name of IEC number (import/export license code number). For instance, if the company were in India, its owner would receive a CODE containing a 10-digit number. The General Director of Foreign Trade, Department of Commerce, Government of India, is in charge of handing out this CODE. Thus, a company wishing to do business in India, would have to approach the local branch of the Department of Commerce. Outlined below, are some laws relating to the receipt of an IEC number in India. 8.2 STEPS IN EXPORT PROCEDURE The policy which is being regulated the Foreign trade of India is Foreign Trade Policy comes under the Central Government exercising the powers was the Development & Regulation Act (Section 5, Foreign Trade Act 1992). The new Foreign Trade Policy came into effect from April 1, 2015 – 20 is come into existence. So, under the FTD& R act, the foreign export is explained as any action of trading any commodities or goods from our country by sea, land or air involving the money transaction.  STARTING EXPORTS It is known that for doing a business on export requires huge preparations by the exporter as it is wide concept. The below mentioned steps are required for starting any export business. Setting Up an Establishment: Prior to launching a business in exports, one should have a sole partnership firm or proprietary concern or a company having very good name and attractive logo. i. Launching a Commercial Account: The exporter should have a financial account in an authorized bank capable of dealing Foreign Exchange. ii. Obtain a PAN: Both the exporter and importer should have PAN (permanent account number), which is issued by the Department of Income Tax. (Click here for applying PAN Card). 149 CU IDOL SELF LEARNING MATERIAL (SLM)

iii. Obtain an IEC number: The policy for Foreign Trade demands that an exporter should have an IEC number from our country India, and it is a compulsory one. The procedure and instructions for obtaining this number is mentioned in the Foreign Trade Policy’s Para 2.05, 2015-2020 and are linked to PAN. This is done by applying online using the URL www.dgft.gov.in according to ANF 2A. It has having Rs.500 as an application fee and this payment can be done either through online Banking or through credit card/debit card with the required documents mentioned in the application. (Click here to obtain the details) iv. RCMC: The Registration Cum Membership Certificate awards permission to import or export goods, as well as other concessions or benefits under the Foreign Trade Policy (FTP - 2015-2020). The RCMC also permits an exporter to have access to guidance or services. The specific authorities/FIEO/Export Promotion Councils/Commodity Boards are in charge of RCMC. v. Product Selection: Except the items in prohibited or restricted list, others can easily or freely export from India. We can make product decision after observing the export trends of different product. vi. Market Selection: Once done the research works about the markets in the overseas such as its competition, its size, terms of payment and its quality requirements, the exporter chooses it. They can also understand the markets based overseas markets, in alignment with the many benefits they have in certain countries that the FTP governs. Friends, Indian Mission in the abroad, agencies handling promotion of exports, colleagues, and relatives are helpful in getting information. vii. Discovering Purchasers: Tools that prove effective for discovering buyers, include exhibitions, trade fairs, browsing of different websites, purchaser-seller meets, and B2B portals. Other useful pathways are the Chamber of Commerce overseas, EPCs, and Indian Missions across the globe. It might also be worthwhile to try creating websites that display product catalogues, pricing of products, modes of payment, etc, in multiple languages. viii. Sampling: The export orders will be made available easy by supplying the samples as demanded by the Foreign buyers. As per the FTP 2015-2020, there one may go in for unlimited technical samples and the bonafide trade. ix. Expense/Pricing: It is vital to garner the attention of purchasers and promote sales in light of heavy global competition. It is imperative to consider several aspects before working out the pricing. To illustrate, one of them is expenses related to sampling. Another is the obtaining of proceeds from exports, based on certain terms connected to sales. These terms include C&F (cost and freight), FOB (free on board), CIF (cost, 150 CU IDOL SELF LEARNING MATERIAL (SLM)