EXIM Concepts

8/12/2019 EXIM Concepts

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SIDBI

The Small Industries Development Bank of Indiais a state-runbankaimed to aid the

growth and development of micro, small and medium scale industries in India. Set up in1990 through an act of parliament, it was incorporated initiall as a wholl owned

subsidiar of Industrial !evelopment "ank of India. #urrent shareholding is widelspread among various state owned banks, insurance companies, etc. "eginning as a

refinancing agenc to banks and state level financing bodies for their credit to smallindustries, it has diversified in to man activities, including direct credit to the S$%

through more than &0 branches located in all ma'or clusters of S$% in India. "esides, it

has been plaing the development role in several was such as support to micro-financeinstitutions for capacit building and on lending.

SI!"I was established on (pril ), 1990. The #harter establishing it, The Small Industries

!evelopment "ank of India (ct, 19*9 envisaged SI!"I to be +the principal financial

institution for the promotion, financing and development of industr in the small scale

sector and to co-ordinate the functions of the institutions engaged in the promotion andfinancing or developing industr in the small scale sector and for matters connected

therewith or incidental thereto.

SI!"I retained its position in the top 0 !evelopment "anks of the orld in the latest

ranking of The "anker, ondon. (s per the $a )001 issue of The "anker, ondon,SI!"I ranked )/th both in terms of #apital and (ssets.

The business domain of SI!"I consists of small scale industrial units, which contribute

significantl to the national econom in terms of production, emploment and eports.Small scale industries are the industrial units in which the investment in plant and

machiner does not eceed s.10 million . (bout .1 million such units, emploing 12.)million persons account for a share of & per cent of India3s eports and 40 per cent ofindustrial manufacture. In addition, SI!"I3s assistance flows to the transport, health care

and tourism sectors and also to the professional and self-emploed persons setting up

small-si5ed professional ventures.

Advising Bank

The advising bank---notifing bank---advises the beneficiar that a letter of credit 67#8

opened b the issuing bank is available to him7her and informs the beneficiar about the

terms and conditions of the 7#. The advising bank is not necessaril responsible for the

pament of the credit which it advises.

The advising bank can be a branch office of the issuing bank or a correspondent bank,

which usuall is located in the beneficiar3s countr. The advising bank in the sample

letter of credit is The $oon "ank.

The issuing bank most often sends the 7# through its branch office or correspondentbank to avoid fraud. The branch office or the correspondent bank maintains specimen
http://en.wikipedia.org/wiki/Bankhttp://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Bankhttp://en.wikipedia.org/wiki/India


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signature6s8 on file where it ma counter-check the signature6s8 on the 7#, and it has a

coding sstem---secret test ke---to distinguish a genuine 7# from a fraudulent one.

The eporter can reuest the importer to specif his7her bank 6the eporter3s bank8 as theadvising bank in an 7# application. The eporter3s bank ma not be the issuing bank3s

correspondent bank, thus the issuing bank ma use other bank as the advising bank.

In man countries, it is beneficial to the eporter when the advising bank is the eporter3s

bank, where the eporter ma avail the reduced bank charges and fees because of specialrelationships with the bank. In addition, it is more convenient to deal with the eporter3s

own bank over a bank with which the eporter does not maintain a business account.

IIP

The Indian Institute of :ackaging was incorporated as a societ under the Societies

egistration (ct 1*&0, on 14th $a 19&&. The Institute has its head office and principal

laboratories at $umbai and regional testing and development laboratories at #alcutta,;ew !elhi and #hennai. The Institute over the ears has built up a ver strong and

capable epertise in various fields of packaging Sciences and Technologies, and with the

ecellent infrastructural facilities available, is geared to cater to the various needs of the

package manufacturing and package user industries, both with regard to domesticdistribution and eport market reuirements. The Institute is closel linked with

international organisations. It is recognised b the 8, the Institute

of :ackaging :rofessionals 6I=::8


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Government of India" under Section 2 of the !ct for the purpose of implementin' thevarious measures and policies formulated by the Export Inspection Council of India

Export Inspection Council" either directly or throu'h Export Inspection !'encies" its

field or'anisation renders services in the areas of

Certification of +uality of export commodities throu'h installation of +ualityassurance systems (In4process uality Control and Self Certification) in the exportin'units as well as consi'nment wise inspection

Certification of +uality of food items for export throu'h installation of 5ood safety

1ana'ement System in the food processin' units

Issue of Certificates of ori'in to exporters under various preferential tariff schemesfor export products

Red Clause and Green Clause

etter of #reditallowing the beneficiar of a documentar credit to receive funds for thepurchase of merchandise described in the credit. These funds, known as advances, are

deducted from the face amount of the draft when the beneficiar presents the letter for

pament. $ost red clause letters are opened in transactions where the beneficiar isacting as agent for the buer in the eporting countr, and purchases merchandise

destined for eport.

( clause in a letter of credit enabling the buer to receive pre-shipment advances againsta collateral represented b, for eample, warehouse receipts7warrants. It is commonl

used in the eport of agricultural commodities, where the compan ma raise funds to

harvest new crops for eport b pledging available stocks as collateral.
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EXIM Concepts