81840371 export scenario in india

7/31/2019 81840371 Export Scenario in India

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Export Scenario in India

• India is all set to become a major player in the world trade.

• India’s strategic location gives immense business opportunities.

• It has high labour advantage & has extensive scientific and

technical manpower.

• Wage rates are competitive compared to international level.

• Government provides incentives to exporters.

• Export of $80bn achieved against a target of $ 74Bn

• 24% Growth rate corresponded to the target of 16%.

• A growth of 34% in imports.

• Exports generated incremental employment of 10Lakh jobs in

2004-05.



Export of Principal Commodities (Rs. Crores)

CommodityApr-Dec

2006Apr-Dec2007(p)

% Growth % Growth

Plantation Rs.3062 Cr. 2672 -12.74 0.58

Agri. & Allied Prods. 27556 34847 26.46 7.61

Marine Products 5681 5473 -3.68 1.19

Ores & Minerals 21052 22711 7.88 4.96

Leather & Mnfrs 10138 9899 -2.36 2.16

Gems & Jewelery 52534 58464 11.39 12.76

Sport Goods 452 374 -17.29 0.08

Chemicals & relatedproducts

61075 63177 3.44 13.79



Export of Principal commodities (Rs. Crores) – contd.

Engineering & related

products

86687 93206 7.29 20.55

Electronic goods 9800 9587 -2.17 2.09

Project goods 530 324 -38.9 0.07

Textiles 54493 52559 -3.55 11.47

Handicrafts 1532 1309 -14.59 0.29

Carpets 3202 2612 -18.42 0.57

Cotton raw INCL waste 2902 3861 -18.42 0.51

Petroleum products 65328 79484 21.67 17.35

Unclassified exports 10446 47511 67.62 3.82

Total 416685 458076 9.93 100.00



Export by Region (Rs. Crores)

Region Apr-Dec 2006Apr-Dec

2007(P)% Growth % Share

1. Europe 93966 106456 13.29 23.29

EU Countries(27) 87724 98607 12.41 21.53

Other WE Countries 5997 7538 25.70 1.65

East Europe 244 310 26.62 0.07

2. Africa 27850 33200 19.21 7.25

Southern Africa 9511 9783 2.86 2.14

West Africa 7680 10974 42.88 2.40

Central Africa 681 760 11.73 0.17

East Africa 9977 11681 17.08 2.55

3. America 81162 80768 -0.49 17.63

North America 67332 65211 -3.15 14.24

Latin America 13830 15555 12.47 3.40



Export by Region (Rs. Crores) – contd.

Region Apr-Dec 2006 Apr-Dec2007(P) % Growth % Share

4. Asia & Asian 208094 230781 10.90 50.38

East Asia 5448 3980 -26.94 0.87

Asian 43155 43542 0.90 9.51

Wana 97357 89058 15.13 19.44

NE Asia 60676 699756 14.96 15.23

South Asia 21456 24444 13.92 5.34

5. CIS & Baltics 4971 5049 3.66 1.10

CARs Countries 671 707 5.42 0.15

Other CIS Countries 4199 4341 3.37 0.95

6. Unspecified regions 739 1819 146.24 0.40

Total 416685 458076 9.93 100.00



Top 10 Commodities of Export (Rs. Crores)

Rank RegionApr-Dec

2006

Apr-Dec


1. Petroleum (Crude &Products)

65328 79484 21.67 17.35

2. Gems & Jewellary 52534 58464 11.29 12.76

3. Machinery & Instruments 22226 24660 10.95 5.38

4.

RMG Cotton INCL

Accession 22388 20951 -6.42 4.51

5. Drugs Pharm. Fine Chen. 19504 20743 6.36 4.53

6. Manufactures of Metals 16908 19565 15.71 4.27

7. Transport Equipment 15203 19025 25.14 4.15

8. Other Commodities 10430 17502 67.80 3.82

9. Cotton Yarn, Fabric 14103 13640 -3.28 2.98

10. Iron Ore 117.19 13168 12.39 2.87



Top 10 Commodities of Export (Rs. Crores)

Rank Country Apr-Dec 2006Apr-Dec


1. USA 63573 61561 3.17 13.44

2. UAE 40672 46140 13.44 1007

3. China PRP 25493 27259 693 595

4. Singapore 21479 20743 463 453

5. UK 18671 19804 607 432

6. Hong Kong 14855 17936 2074 392

7. Germany 12818 14682 1453 321

8. Netherlands 8523 14439 6942 315

9. Belgium 11075 12109 934 264

10. Italy 11792 11235 473 245

Total 416685 458076 993 100



Export to SAARC Countries & CIS Countries

• South Asian Free Trade Area (SAFTA): it provides phased tariff

liberalization programme (TLP) under which in two years Non-least

developed contracting states (NLDCS). Bangladesh, Bhutan,

Maldives & Nepal are (LDCS).

• NLDCS to bring down tariffs to 20% & LDCS to 30%.

• Non LDCS to bring down tariffs from 20% to 0.5% in 5 years while

LDCS will do in 8 years

• NLDCS to reduce their tariffs for LDC products to 0.5% in 3 years

• Preferential trade agreement (PTA) gives access to only certain

goods, reduce tariffs

• India enjoys PTA with Afghanistan, Chile & MERCOSUR (Brazil,

Argentina, Uruguay & Paraguay).



Export to Afghanistan

• PTA through reduction & elimination of tariffs on the movement of

goods.

• 8 items are covered in preferential tariffs granted by Afghanistan,

38 items granted by India as per agreement.

Export to Bangladesh• Trade is governed by agreement signed in April 2006 & is valid for

3 years.

• Use of waterways, roadways, railways are permitted for

transporting goods between two countries.

• Under this agreement mutually most favoured nation (MPN)

granted to each other.

•Both nations will grant vessels flag of any third country.



Export to Bhutan

• Agreement provides free trade & commerce between two countries.

• Agreement signed on 29th March, 2006 & is valid for 10 years.

• All exports & Imports of Bhutan to & from other countries other than

India will be free from & not subject to custom duties & trade

restrictions of India.

• India provides transit facility for Bhutan’s trade.

• Agreement on excise duty on goods of its origin exported to the

other.



Export to Maldives

• Governed by agreement signed on 31st

March 1981.

• Most favoured nations to each other.

• Merchant Cargo Vessel of each country will be given MFN.

Both countries shall encourage & facilitate:

Visit of commercial and technical representative

Participation in trade fair

• Arranging exhibitions exemption from custom duties as per laws.

• India has agreed to supply commodities though may be in

restricted list as per quota.



Export to Nepal

• Indo Nepal treaty of trade valid upto 2012.

• Treaty of transit.

• Agreement of cooperation to control unauthorized trade.

Export to Pakistan

• There is no formal trade agreement.

• India has granted MFN status but Pakistan has not.

• Pakistan imports from India 1075 items.



Export to Sri Lanka

• Indo Lanka trade agreement

• Free trade zone for movement of goods through elimination of

tariffs being aimed to achieve

• Products of origin are eligible for preferential treatment.

• For development of specific sectors of industry, both countries

agree to lower value addition norms being considered.

• Joint committee/group on customs etc.

• Duty free access to all exports from Sri Lanka.

• Sri Lanka to provide tariff concessions on exports to Sri Lanka.



Export to CIS Countries

• CIS has no formal political institution.

• Reasons affecting trade are: distance, language barrier, inadequate

transit facility, inadequacy of information regarding business

opportunities.

• Lack of interaction.

• Inadequate banking facilities in CIS countries

• Trade facilitation measures were taken

International transit agreement for movement of goods Banking facilities in CIS countries created by India

Double taxation avoidance agreement (DTAA)

Bilateral investment promotion agreement (BIPA)



• Trade Promotion Measures

More interaction

Joint commissions

FICCI/CII etc.

Indian trade promotion organization

Export Credit & guarantee organization

Export promotion councils

Apex chamber of commerce

EXIM Bank, Indian missions



Export Strategy

• Define strategy fo export

• Layout plan for export

• Carryout SWOT analysis

• Study government rules & regulations

1. Decide company objectives for export

2. Study foreign markets with the following in view

3. Economic stability of importing country

4. Political relations between two countries5. Distance of potential market & cost implications

6. Transport and distribution infrastructure to the importing

country



Market Information

• Department of Commerce and Government agencies con provide

market information.

• Export promotion councils/commodity boards.

• Federation of Indian Export Organization.

• Indian Institute of foreign Trade.

• Indian Trade Promotion Organization.

• Overseas Chambers of Commerce & Industry.

• Embassies & High Commissions.

• Analyze Trade Economic Statistics.

• Hire consultant for International Trade & Marketing.

• Talk with successful exporter.

• Engage in market research through, internet, yellow pages,

advertisements, friends etc.

• Select a product.



Operations

• Export business can be operated through merchant exporter or

manufacturer exporter.

• Agent on behalf of exporter.• Channels of export: agent, open a branch office overseas, export

through canalized agency, trading house, export house or direct

export.

• Locating buyers from magazines, business directories, export

assistance centers etc.

• Advertisement in TV etc.

• Brochures, photographs, details of company can be sent to

overseas buyers.

• Open bank account.

• Import export code number.

• Registration cum membership certificate (RCMC) for exporter as

per foreign trade policy.

• PAN, VAT registration, export licence.



Appointing Overseas Agent

• Agent is someone who acts on behalf of a principal.

• He can be paid salary or commission.

• Benefits of appointing agent.

a) Local knowledge & established networks.

b) Knows demand & supply.

c) Can identify immediate & prospective competitors.

d) He is a source market knowledge & intelligence.

e) He can render valuable advice on future market trends.

f) He can provide support for transportation, accommodation,

laison with Government depts whenever required by exporter.



Factors for Appointing Agent

• Current status & history of agent.

• Agencies held now by agent

• Sales coverage, territory etc.

• Capability to promote sales etc.

• Trade & bank references

• Commission & payment terms

• Type of agent : Commission agent, spare parts, service stocking

agent.



Agency Agreement

1. Not have business dealings with competing firms.

2. Not reveal any confidential information to competitor.

3. Not enter into agreement binding to the Indian company.

4. Refer all quarries to India.

5. Performance requirement – minimum sales volume.

6. Safeguarding Indian company’s interest.

7. Termination.

8. Specify terms of agreement, period of agreement & renewalprocess.

9. What county’s laws will apply.

10. Language of contract.



Export Promotion & Incentives

Assistance to States for Infrastructure Development of

Exports (ASIDE)

• To encourage & participate in promotion of exports

• Objectives of ASIDE are:

a) Developing infrastructures like roods, ports etc

b) Setting up ICDs & CFS

c) Creation of state level export promotion industrial parks/zones.

d) Augmenting common facility in existing zones.

e) Equity participation in infrastructure projects.

f) Development of minor ports & jetties.

g) Assistance in setting up common affluent treatment plants.h) Power supply.

i) Any other activity notified by department of commerce.

• Funds are allocated to the above works for improvement of

infrastructure to the states.



Marketing Development Assistance (MDA)Objectives1. Assist individual exporters for export promotion activities abroad.

2. Assist export promotion councils to undertake export promotionactivities abroad for their products.

3. Assist approved organizations/trade bodies to undertake innovativeactivities for export promotion

4. Assist EPCs to contest countervailing duty/antidumping cases

initiated abroad.5. Assist focus area export promotion programmes in specific regionsabroad. Like Focus CIS, Africa.

6. promote residual essential activities connected with marketingpromotion efforts abroad.

7. Financial assistance with grant is available to exporters to travel toLatin America, Africa, CIS region, Asian countries, Australia & NewZealand.

8. In other areas financial assistance without travel grant is available.9. MDA is available for exporters with annual export turnover upto

Rs.15 Crores.



Market Access Initiative Scheme (MAI)

• MAI has been launched to promote exports on sustained basis.

• It is based on ‘focus product’, ‘focus market’.

• Assistance is extended to EPCs & other bodies involved in exports.

• Activities funded under MAI are:

• Market studies, setting up show rooms, warehouse sales promotion

companies, participation in international trade fairs, brand

promotion, registration charges for Pharma & Testing charges for

engineering products.

• Assistance ranges from 25% to 100% of total cost.



Towns of Export Excellence (TEE)

• Some towns have been substantially towards exports.

• Recognition is being granted to these industrial clusters to

maximize their potential & to move up in value chain.

• Towns producing goods of Rs.1000 Crores or more will be notifies

as Towns for Export.

• However towns for excellence in handlooms, handicrafts,

agriculture, fisheries sector threshold limit would be Rs.250 Crores.

• Recognized associations of units will be able to access funds under MAI for creating technological services.

• Common service providers are eligible for EPCG.

• Such areas will receive priority assistance from ASIDE.



Focus Market Scheme

• The objective is to offset the high cost and other disabilities to

select international market to enhance export competitiveness to

these countries.

• Exporters are entitled for 2.5% duty credit scrip of the FOB value of

exports.

• The scrip & items imported under the scheme are freely

transferable.

• Coverage of FMS increased to include 10 more countries

Mongolia, Bosnia, Albania, Macedonia, Croatia, Honduras, Djibouti,Sudan, Ghana, Colombia.

• Products which have low penetration are considered for export

incentives as FPs.



Focus Product Scheme

• Incentives export of such products which have high employment

intensity.

• To offset infrastructure inefficiency costs, these incentives are

provided.

• Exports of notified products through EDI enabled ports to all

countries are eligible for duty credit scrip equivalent to 1.25% of

FOB value of exports.

• Exports made by EOUs who do not avail tax benefits exemption

are eligible.

• Deemed exports, are not eligible.

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81840371 export scenario in india

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