Export procedure in India
Firstly, Exports, like the import system, may consider one of the key components of international trade. Moreover, exports and imports have accelerated their growth after the LPG initiative. Exporting by country is subject to several legal and also compulsory methods made by the country of export. In this section, however, we will learn about these methods that stimulate domestic economic activity. Trade exports its goods and services to other countries by adhering to basic principles and law, thus making it very important in the study of the export procedure and import sectors.
Typically, an export procedure begins with the desire to ship goods and services to other foreign countries at certain prices, also these export procedures may outline below:
Step 1: Receipt Order
The Indian exporter will receive the order directly from the importer or through indent houses.
Step 2: Obtaining License and Allocation
After receiving the order from the importer, the Indian exporter has to obtain an export license from the Government of India, for which the exporter has to apply to the Export Trade Regulatory Authority and also obtain the appropriate license.
Step 3: Letter of Credit
The exporter asks the importer for a letter of credit if the importer does not send the letter of credit with the order.
Step 4: Determine the transfer rate
The exchange rate of the home currency with the foreign exchange may then determine. The foreign exchange rate changes from time to time, so they need to set the exchange rate.
Step 5: Forex Exchange Formalities
According to the Foreign Exchange Regulation Act of India (FERA), the law requires every exporter of goods to give a notice in the form prescribed.
Step 6: Preparation for the execution of the order
The exporter must make the necessary arrangements to execute the order.
Step 7: Formalities by a forwarding agent
The agent can require to obtain clearance from the customs department, prepare the shipping bill, and then pay the outstanding amount after disclosing the required details of the item to export.
Step 8: Loading Bill
The Indian exporter of goods issues a copy of the receipt to the shipping company and issues the Bill of Loading.
Step 9: Export advice to the importer
The Indian exporter sends the export consultant to inform the importer of the goods about the shipment.
Step 10: Issue the documents to the bank
The Indian exporter must ensure that he has all the required shipping documents.
Step 11: Realization of export earnings
The exporter of goods must comply with the banking procedures after submitting the transfer bill.
Export procedure and documentation
In the previous section, we learned about export processing methods and however, here we will learn about the required documents –
Step 1: Get an inquiry
Thus, The first step in the shipping documentation process is prompting someone to purchase the goods.
Step 2: Screen Potential Buyer and Country
After you get an inquiry from the buyer, the process is to check their business potential to do business with them.
Step 3: Provide a specification
After screening the buyer, then we must provide the specification for the transaction.
Step 4: Complete the sale
The buyer will reject or accept your offer, thus finalizing the sale.
Step 5: Prepare supplies and shipping documents
Business Invoice, Packing List, Certificate of Origin, Instruction Letter, also Loading Bills all want to prepare.
Step 6: Run a restricted party screening
Again, this process must be run before the goods can be shipped for export.
Step 7: Send in various forms and your items
There may be other documents that need to be prepared before the goods can be exported.
Needs of registration and export documents
Export is a broad concept that includes many of the preparations required by an exporter before starting an export business.
1) Establishing an Organisation
2) Opening a Bank Account
3) Permanent Account Number
4) Importer-Exporter Code Number
5) Registration cum membership certificate
6) Selection of product
7) Selection of Markets
8) Finding Buyers
11) Negotiation with Buyers
12) Covering Risks through ECGC
1. What are Indent Houses?
Imports of goods from abroad can be affected in two ways. Moreover, the Importation of goods can take place directly or through an intermediary. Another way is to import the goods through an intermediary and this is called an indenting house.
2. What is meant by ‘Letter of Credit’?
A letter of credit, also known as a “letter of credit,” is a letter from the bank that guarantees a seller that the buyer’s payment will be received on time and in the right amount. Besides, If the buyer is unable to pay for the purchase, the recommended bank must reimburse the full or partial amount of the purchase.
3. What is Bill of Lading?
Thus, The loading bill is a document issued by a cart corresponding to the shipment of the goods. Although historically the word has only been associated with a carriage passing by sea, a bill can be applied today to any kind of cargo.