View
0
Download
0
Category
Preview:
Citation preview
IMPORT FOR TRADING
1(c)ashutosh kumar1
Dr.S.Thilaga/EXIM Management/BA5060/Unit III
CONTENTS:Definition
Types of export
Role of govt in export
Export/import process
Export/import financing
Exim policy
Comparison of trade policy
India’s Exim policy 2009-14
Objective of india’s Exim policy
Balance of trade
Bibliography
2
(c)a
sh
uto
sh
ku
ma
r
2Dr.S.Thilaga/EXIM Management/BA5060/Unit III
DEFINITION
The term export is derived from the
conceptual meaning as to ship the goods
and services out of the port of a country
The seller of such goods and services is
referred as an "exporter" who is based in
the country of export
Whereas the overseas based buyer is
referred to as an "importer"
3
(c)a
sh
uto
sh
ku
ma
r
3Dr.S.Thilaga/EXIM Management/BA5060/Unit III
CONTD.
In International Trade, "exports" refers to
selling goods and services produced in the
home country to other markets
Exporting is the most popular way for
companies to become international
Exporting is usually the first mode of foreign entry used by companies 4
(c)a
sh
uto
sh
ku
ma
r
4Dr.S.Thilaga/EXIM Management/BA5060/Unit III
CONTD.
Selling to foreign markets involves numerous high risks, arising from a lack of knowledge about and unfamiliarity with foreign environments, which can be heterogeneous, sophisticated, and turbulent
Manufactured goods accounted for almost 60 percent of the exports of developing countries 5
(c)a
sh
uto
sh
ku
ma
r
5Dr.S.Thilaga/EXIM Management/BA5060/Unit III
TYPES OF EXPORT
Direct export
Direct exporting occurs
when a manufacturer
or exporter sells
directly to an importer
or buyer located in a
foreign market
Indirect export
Indirect exporting
involves the use of
independent
middlemen(brokers,
bank) to market the
firm’s products
overseas
6
(c)a
sh
uto
sh
ku
ma
r
6Dr.S.Thilaga/EXIM Management/BA5060/Unit III
DIRECT EXPORT/IMPORT
indian Importer American Exporter
1. Importer Pays for Goods
2. Exporter Ships Goods After Being Paid
7
(c)a
sh
uto
sh
ku
ma
r
7Dr.S.Thilaga/EXIM Management/BA5060/Unit III
A TYPICAL INTERNATIONAL
TRANSACTION
french ImporterAmerican Exporter
Bank of New York Bank of paris
7. ExporterPresentsDraft to Bank
10 and 11 Exporter Sells Draft to Bank
6. Goods Shipped to France
12. Bank TellsImporterDocuments
14. B of NY Presents MaturedArrive
Draft and Gets Payment
13. Importer Pays Bank
1. Importer Orders Goods
2. Exporter Agrees to Fill Order
3. Importer Arranges for LOC
8. B of NY Presents Draft to Bank of Paris
9. Bank of Paris Returns Accepted Draft
4. Bank of Paris Sends LOC to B of NY
5. B of NY Informs Exporter of LOC
8
(c)a
sh
uto
sh
ku
ma
r
8Dr.S.Thilaga/EXIM Management/BA5060/Unit III
Composition of India’s Exports
Agricultural & Allied
Products
Ores &Minerals
ManufacturedItems
Fuel &Lubricants
9
Composition of India’s Imports
PetroleumProducts
Capital GoodsPearls &PreciousStones
Iron & Steel
(c)a
sh
uto
sh
ku
ma
r
9Dr.S.Thilaga/EXIM Management/BA5060/Unit III
ROLE OF THE GOVERNMENT IN
PROMOTING EXPORTS
Export promotion activities generally comprise:
1.export services programs
2.market development program
Export-import bank tariff concessions
1.foreign trade zones
2.foreign sales corporation(FSC)
10
(c)a
sh
uto
sh
ku
ma
r
10Dr.S.Thilaga/EXIM Management/BA5060/Unit III
EXPORT PROCESSES
Evaluate export potential
financial resources
management capability/experience
competitive advantages abroad
Do country analysis (more later)
country receptiveness to imports and investment
trade barriers/requirements
infrastructure
11
(c)a
sh
uto
sh
ku
ma
r
11Dr.S.Thilaga/EXIM Management/BA5060/Unit III
CONTD.
Do market analysis
market size/product potential
distribution channels
Determine entry method
goal of entry
select distribution “partner”
determine channel length
assess risks
determine costs 12
(c)a
sh
uto
sh
ku
ma
r
12Dr.S.Thilaga/EXIM Management/BA5060/Unit III
SOURCES OF EXPORTER
FINANCING
r:Financing exporter credit to the importe
- Bankers’ acceptance (of the draft)
- Factoring
- Forfeiting
- EXIM bank
13
(c)a
sh
uto
sh
ku
ma
r
13Dr.S.Thilaga/EXIM Management/BA5060/Unit III
PROCEDURES OF EXPORT AND IMPORT
TRANSACTION
General Procedures of Export Transaction:
Preparation for Exporting
BusinessNegotiation
Implementation of Contract
Settlement ofDisputes
14
(c)a
sh
uto
sh
ku
ma
r
14Dr.S.Thilaga/EXIM Management/BA5060/Unit III
EXPORT/IMPORT FINANCING
Letters of Credit (LOC)
Bank guarantee on behalf of importer to exporter
assuring payment when exporter presents specified
documents
Drafts (Bill of Exchange)
Written order by exporter, telling an importer to pay a
specified amount of money at a specified time.
Bill of Lading
Issued to exporter, by carrier. Serves as receipt,
contract and document of title.
15
(c)a
sh
uto
sh
ku
ma
r
15Dr.S.Thilaga/EXIM Management/BA5060/Unit III
WHAT IS EXPORT IMPORT POLICY
(EXIM POLICY)?
Export Import (Exim) Policy or Foreign Trade Policy (FTP) is a set of
guidelines and instructions in matters related to the import and export of
goods in India.
Established by the Directorate General of Foreign Trade (DGFT)
Regulated by The Foreign Trade Development and Regulation Act 1992
Exim policy contains various policy decisions with respect to import and
exports of the country.
Prepared and announced by the central government.
Aim
Developing export potential
Improving export performance
Encouraging foreign trade
Creating favorable balance of payment position.
16
(c)a
sh
uto
sh
ku
ma
r
16Dr.S.Thilaga/EXIM Management/BA5060/Unit III
CONTD.
of Trade Policy will strongly influence the
direction, trend and growth of foreign trade a country
Industrialisation and self-sufficiency in essential commodities were the important objectives of India's trade policy
trade policy is an important economic instrument which can be used by a country, with suitable modifications from time to time, to achieve its long-term objectives
Trade Policy can be free trade policy or protective trade policy
17
(c)a
sh
uto
sh
ku
ma
r
17Dr.S.Thilaga/EXIM Management/BA5060/Unit III
COMPARISON OF TRADE
POLICY
FREE TRADE POLICY
A free trade is one which does not impose any restriction on the exchange of goods and services between different countries.
A free trade policy involves complete absence of tariffs, quotas, exchange restrictions, taxes and subsidies on production, factor use and consumption.
PROTECTIVE TRADE POLICY
A protective trade policy pursued by a country seeks to maintain a system of trade restrictions with the objective of protecting the domestic economy from the competition of foreign products.
Many of the underdeveloped countries continue to have protective trade policies even today.
18
(c)a
sh
uto
sh
ku
ma
r
18Dr.S.Thilaga/EXIM Management/BA5060/Unit III
INDIA'S EXIM POLICY 2009-2014
The Union Commerce Ministry, Government of
India announces the Export Import policy in every
five year. This is also called EXIM policy. This policy
is updated every year with some modifications and
new schemes. New schemes come into effect on
the first day of financial year i.e. April 1, every
year. The Foreign trade Policy which was
announced on August 28, 2009 is an integrated
policy for the period 2009-14. This policy is
updated on every financial year. 19
(c)a
sh
uto
sh
ku
ma
r
19Dr.S.Thilaga/EXIM Management/BA5060/Unit III
OBJECTIVES OF EXIM POLICY 2009-
2014
To arrest and reverse declining trend of exports which will be
reviewed after every two years.
To Double India's exports of goods and services by 2014.
To double India's share in global merchandise trade by 2020
(long term aim). India's share in Global merchandise exports
was 1.45% in 2008.
Simplification of the application procedure for availing various
benefits.
To set in motion the strategies and policy measures which
catalyze the growth of exports. 20
(c)a
sh
uto
sh
ku
ma
r
20Dr.S.Thilaga/EXIM Management/BA5060/Unit III
INDIA'S FOREIGN TRADE IN JUNE
2012
Exports:
India’s exports through June 2012 were valued at US$29.21 billion, which
was 46.45 percent superior to the level of US$19.94 billion seen in June
2011. On an expanded timeframe, the growing value of exports for the
period April-June 2011-12 was US$79.00 billion against US$54.22 billion
over the same period a year earlier – good for a 45.71 percent increase.
Imports:
India’s imports for the duration of June 2012 came to US$36.87 billion,
showing a growth of 42.46 percent over the level of imports valued at
US$25.88 billion in June 2011. An increasing value of imports for the
interval of April-June 2011-12 was US$110.61 billion as against US$81.20
billion over the same period in 2010 – good for a 36.22 percent increase.21
(c)a
sh
uto
sh
ku
ma
r
21Dr.S.Thilaga/EXIM Management/BA5060/Unit III
1,400,000
1,200,000
1,000,000
800,000
600,000
400,000
200,000
0
1,600,000
2004-05 2005-06 2006-07 2007-08 2008-09 2009-10
Foreign Trade Trends in India
Export Import
22
(c)a
sh
uto
sh
ku
ma
r
22Dr.S.Thilaga/EXIM Management/BA5060/Unit III
Balance of trade = Exports - Imports
A positive balance of trade is known as a trade surplus
A negative balance of trade is known as a trade deficit or,
informally, a trade gap.
India reported a trade deficit equivalent to 7659 Millions USD in
June of 2011.
India is poor in oil resources and is currently heavily dependent
on coal and foreign oil imports for its energy needs.
Other imported products are: machinery, gems, fertilizers and
chemicals.
BALANCE OF TRADE
23
(c)a
sh
uto
sh
ku
ma
r
23Dr.S.Thilaga/EXIM Management/BA5060/Unit III
24
INDIA’S BOT
(January 2009 – July 2011)
(c)a
sh
uto
sh
ku
ma
r
24Dr.S.Thilaga/EXIM Management/BA5060/Unit III
AN
YQ
UE
RY
?
25
(c)ashutosh kumar
25Dr.S.Thilaga/EXIM Management/BA5060/Unit III
BIBLIOGRAPHY
Wikipedia
Official website of Indian export-import
portal
Internet
Oxford dictionary
26
(c)a
sh
uto
sh
ku
ma
r
26Dr.S.Thilaga/EXIM Management/BA5060/Unit III
THANKING
YOU
THANKING
YOU27
(c)a
sh
uto
sh
ku
ma
r
27Dr.S.Thilaga/EXIM Management/BA5060/Unit III
Recommended