Export - Import

Procedure and Documentation

Content
• What is international trade?
• Significance of procedure and documentation
• Trade barriers
• Meaning of export import
• Deemed Export
• HS classification system
• India Foreign Trade
• India foreign Trade policy
• Export documentation, order processing and clearance
• Insurance
 Meaning of International Trade
✔ International trade is referred to as the exchange or trade of goods and services between
different nations. Domestic trade occurs within the political boundaries of a nation whereas
international trade occurs across the political boundaries of different nations.

✔ International trade has exceptionally increased, which includes services such as foreign
transportation, travel and tourism, banking, warehousing, communication, distribution, and
advertising. Other equally important developments are the increase in foreign investments and
production of foreign goods and services in an international country.

✔ These foreign investments and productions help companies to come closer to their international
customers, thus serving them with goods and services at a very low rate.

✔ All the mentioned activities are parts of international business. It can be concluded by saying that
international trade and production are two aspects of international business, which is growing
day by day across the globe.
✔ International trade also known as Foreign trade, external trade or inter-regional
trade. It consists of imports, exports and entrepot.
✔ The inflow of goods in a country is known as import trade, whereas outflow of
goods from a country is known as export trade.
✔ Many times, goods are imported for the purpose of re-export after some
processing. This is known as entrepot trade.
✔ International trade involves different currencies and is regulated by the laws,
rules and regulations of various countries involved in it.
✔ Foreign trade is exchange of goods, services and capital across international
borders or territories.
✔ Generally, no country is self-sufficient. It has to buy from other countries, what it
cannot produce or can produce less than its requirements. Similarly, it sells to
other countries the goods which it has in surplus quantities.
 Reasons For International Trade

✔ Uneven distribution of Natural Resources

✔ Difference in level of Technology

✔ Advancement in Information Technology

✔ Division of labour and Specialisation

The principle of comparative advantage is the basis of international trade.

Each nation or region specialises in the production of those goods and services
in which it enjoys maximum comparative advantage and imports or purchases
its other requirements from the other nations. Thus, principle of division of
labour and specialisation is the basis of world trade.
 Significance or Merits of Foreign Trade
✔ Division of Labour and Specialization

✔ Optimum allocation and Utilization of Resources

(resources are channelized for the production of only those goods which give highest return)

✔ Facilitates Transfer of Technology

✔ Price Stabilization
(goods and services move from the places of abundance to the places of deficiency and stabilize the demand and
supply positions)

✔ Improves Balance of payments Position

✔ Generate Employment Opportunities

✔ Higher Standard of living

✔ Facilitates Economic development
✔ Assistance during natural calamities
✔ Global Peace
 Demerits of Foreign Trade
✔ Restricted growth of Home Industries
✔ Economic Dependence
✔ Political Exploitation
✔ Misuse of Natural resources
✔ Import of Harmful goods
✔ Rivalry among Nations
✔ Invasion of Culture
✔ Shortage of essential goods
✔ Threat to world peace
✔ Hardships in times of wars
✔ Spread of economic Troubles
 Meaning of Export And Import
As per Foreign Trade (Development and Regulation) Act, 2010

Export means:
(a) In relation to goods, taking out of India any goods by land, sea or air.

(b) In relation to services or technology:

• Supplying services or technology-

✔ From India into the territory of any other country. For e.g. A user in Australia receives services from India
through its telecommunication or postal infrastructure. Such supplies may include consultancy or market
research reports, medical advice, distance training etc.

✔ In India to the service consumer of any other country. For e.g. Nationals of Australia, Afghanistan have
moved to India as tourist, Students or Patients to consume the services in India.
 Export
✔ By a service supplier of India, through commercial presence in the territory of any other Country.

✔ By service supplier of India, through presence of Indian natural persons in the territory of any other country.

Import means:
(a) In relation to goods, bringing into India any goods by land, sea or air.

(b) In relation to services or technology:

Supplying services or technology-

✔ From the territory of another country into the territory of India.
✔ In the territory of another country to an (Indian) service Consumer.
✔ By a service supplier of another country, through commercial presence in India.
✔ By a service supplier of another country, through presence of their natural persons in India.

Provided that ‘import’ and ‘export’ in relation to the goods, services and technology Special Economic Zone or
between two Special Economic Zones shall be governed in accordance with the provisions contained in the
Special Economic Zones Act, 2005.
 Deemed Export
✔ There are certain transactions in which the goods supplied do not leave the country and the
payment for such supplies is received either in Indian rupees or in free foreign exchange
reckoned at par with exports. Such transactions are termed as “deemed Export”.

✔ The Export and Import policy (EXIM Policy 1997-2002) defined Deemed Exports as the goods
(and not services) manufactured in India and transported locally i.e. they do not leave India.

✔ Deemed export basically means that the supplier may receive the payment for this
transaction in either Indian rupees or convertible Forex.

✔ For e.g. when a Kerala based manufacturer suppliers goods to an Export oriented Unit in
Maharashtra, who further ships the product to its customer in the US- the first part of the
transaction is classified as deemed export while the second transaction is considered an
export.
 Classification of Export and Import
✔ Permissibility of import and export is governed by the nomenclature, India Trade Classification
(ITC) Harmonised system (HS) classification of import and export goods, published by the
Directorate general of Foreign Trade (DGFT).

✔ HS is an international nomenclature of goods classification developed by World Custom

Organisation (WCO) inn 1998.

✔ Adopted by 190 countries

✔ HS consists of 6-digit codes for all traded goods, which are used to satisfy custom requirements
worldwide.

✔ This code is important because it determines the tariff/duty rate and also keep a record of
international trade statistics.

✔ ITC (HS) code has 8 digits ( the first 6 digit are common as per WCO with an additional 2 digit for
added specificity).
 Export and Import - ‘FREE’ unless regulated
Export and Import - ‘FREE’ unless regulated by way of “prohibition” “restriction” or “exclusive trading
through State Trading Enterprises (STEs) as laid down in Indian Trade Classification (Harmonized
System) (ITC (HS)) of Export and Import.

(a) Prohibited Goods

Prohibited items are not permitted for import and export. Only 4 items – tallow fat, animal rennet, wild
animals and unprocessed ivory are completely banned from importation.
Prohibited items of exports are all form of wild animals, exotic birds, beef, sea shells, peacock feathers
etc.

(b) Restricted Goods

Permitted under Licence
Procedures/conditions specified against restricted items may be required to be compiled with in
addition to the general requirement of licence in all cases of restricted items. Restricted Imports-
horses, bulls, cows, buffaloes etc.
Restricted Exports- paddy, chemical fertilizers etc.
(c) State trading Enterprises
Export through STEs is permitted without a License through designated STEs only as mentioned
against an item and is subject to conditions stipulated in the Foreign Trade Policy. Some of these
designated agencies are Food Corporation of India, Mineral and Metal Trading Corporation of
India, Agricultural and Processed Food Export Development Authority etc.

(d) Country and Product Specific Restriction:

Prohibition on import and export of arms and related material from /to Iraq.
Prohibition on direct/indirect import and export from/to Democratic People’s Republic of Korea.
Prohibition on direct/indirect import and export from/to Iran.
Prohibition on import of Charcoal from Somalia.

Export of SCOMET items

Export of dual use items and technology is either prohibited or is permitted under a licence. In
Foreign Trade Policy, dual use items have been the nomenclature of Special Chemicals,
Organisms, Material, Equipment and Technologies (SCOMET). Some examples of SCOMET items
are nuclear material, toxic Chemical agents, micro-organisms, aerospace systems, electronics,
computers and information Technology etc.
 Categories of Exporter

✔ Manufacturer Exporters
Manufacturer exporters are the producers who export goods directly without any intervention from
intermediaries. They may appoint agents abroad for selling their products.

✔ Merchant Export
Merchant Export are the exporters who purchase goods from domestic market and sell them in the foreign
countries as per demand. They are indirect exporters.

✔ Export House Agents, Status Holder & Service Export House

An Export House Agent is a firm that undertakes most of the exporting activities like to travel abroad, do
research and to prepare an export plan, to advise exporter on marketing mix, to undertake promotional
activities, to handle logistics & documentation on the behalf of an exporter usually for a commission.
Export house was introduced in 1960 followed by Trading House in 1981 and then to Status Holder. The
concept of service Export House was introduced in EXIM policy 2002-07.
The service providers who have achieved a stipulated level of export performance are eligible for the
recognition as status holders. Service providers who are recognized as status holders are eligible for all the
facilities and incentives given to export house and trading house. These facilities include import of capital
goods under EPCG scheme, import of restricted items.
Canalising Agencies:
Canalisation of import and export means import and export of commodities through specified
government agencies such as State Trading Corporation of India (STC), Metals and
Minerals Trading Corporation (MMTC) etc. the items specified in the canalized list can be exported only
through specified canalizing agency.
For e.g. onion (all varieties) Canalising agency : State Trading Enterprises (STEs) subject to the
conditions laid down by DGFT.

Export Consortia:
Export consortia are the organizations set up voluntarily or under the direction of the government by a
number of independent manufacturers for the co-ordination of their export activities.
Such consortia offers a number of advantages to its members:
Saves unproductive expenditures such as advertising
Sharing of information
Economies of scale
 India’s Foreign Trade
✔ Foreign trade of India includes all imports and exports to and from India.
✔ Foreign trade in India is administered by the Ministry of Commerce and Industry,
Government of India.

✔ The Foreign Trade( Development and regulation) Act,1992 governs all international
transactions in goods and services in India while the payments for import and export
transactions are governed by the provisions of the Foreign Exchange Management
Act,1999.

✔ The Customs Act,1962 governs the physical movement of goods and services
through various modes of transportation.

✔ To promote image of India as a producer and exporter of quality goods, the Export
(Quality Control and Inspection) Act, 1963 was passed.
✔ Since India opened its markets starting 1990-91, there has been an exponential rise in the
country’s foreign trade exposure – exports have increased more than 16 times and imports
more than 19 times.
✔ India exports approximately 7500 commodities to about 190 countries and import around
6000 commodities from 140 countries.
✔ India exported US$ 275.9 billion and imported US$ 384.4 billion worth of commodities in
2016-17.
✔ India exported US$ 291.80 billion, declining 6.8% and imported US$ 394.43 billion worth of
commodities in 2020-21.
✔ India’s merchandise exports in January 2021 were USD 27.24 billion as compared to USD
25.85 billon in January 2020.
✔ It is worth noting that raw materials and intermediates account for a considerable proportion
of India’s exports, while finished products have an overwhelming presence in India’s imports
basket.
✔ While the global trade slump sprung by the COVID-19 pandemic is expected to outlast the
global crisis following 2008-09, India’s foreign trade statistics offers scope for optimism.
Foreign trade saw a dip of 6.8 percent for India – a better performance than the forecasted
9.2 percent decline in global trade by the World Trade Organization (WTO) in October 2020.
Export ✔ The uncertain global trade situation caused by
the pandemic severely hit global merchandise
trade in 2020, and India was not immune to the
impact. Exports in FY 2020-21 amounted to a
total of US$291.8 billion, declining 6.8 percent.

✔ Among the top exported items – mineral fuels

(oil) and gems and precious metals were the
two most exported items, for a combined share
of 18 percent.

✔ 2021 also predictably witnessed a surge in the

performance of the pharmaceutical industry,
whose production accounted for the third most
exported category of items for the financial
year.
Export

✔ Exports to USA
continued to dominate
with a share of over 17
percent of India’s total
exports.

✔ This was followed by

China and the UAE,
swapping positions, as
exports to the UAE
dropped significantly in
2020-21.
✔ Imports during FY 2020-21,
on the other hand, saw a
decline of more than 16
percent, amounting to
US$394 billion.

✔ Mineral fuels and precious

stones and metals remained
the top imported items, with
an increased demand for
animal/vegetable fats and
oils.
✔ For imports in FY2020-21,
India’s top three
destinations were China,
USA, and UAE, with imports
from Switzerland rising to
fourth top sourcing
destination.

✔ Switzerland accounts for a

significant proportion of
India’s precious metal
imports, led by gold.
Region wise distribution for Indian exports in 2020-21

Looking at the region wise

share of exports, the data
indicates a steady growth in
exports from 15.31 percent in
2014-15 to 19.77 percent in
2020-21 to North America,
countered by a decline in
Asia’s share of 48.52 percent
in 2014-15 to 46.52 percent
in 2020-21.
✔ The past few years have seen a steady decline in Asia’s share in India’s export basket
accompanied by an increase in trade with countries in the west. This is likely because India is
pulling away from trade partnerships in the east and looking to establish new trade relations in
relatively under-tapped markets in western countries.

✔ The Indian government withdrew from the Asia-Pacific Regional Comprehensive Economic
Partnership (RCEP) in November 2019 due to the assessment that Indian exports were not
flourishing to the region despite reduced non-tariff barriers (NTB) as ASEAN nations and India
offer similar labor-intensive products in their export basket.

✔ There has also been a shift in the approach towards global trade as India looks to build up trade
exposure with western countries, a somewhat interesting development following geopolitical
events like the US-China trade war, recent Australia-China trade tensions, and Brexit.
✔ Free trade agreement (FTA) negotiations are currently ongoing or planned to start in 2021 with
the UK, European Union (EU), USA, Australia, and UAE. Both, the EU and UK are keen to
re-establish their credentials as strong trade partners to India – eyeing its large consumption
market and growing disposable incomes besides wanting to expand sourcing destinations.
 India’s foreign trade policy

✔ Once again postponed from October 2021 to March 2022, the next Foreign Trade Policy (FTP)
(following FTP 2015-20) wants to grow India’s annual good and services exports to over US$1
trillion by FY 2026-27.

✔ The new FTP is much awaited as it will offer government-supported strategies to cash in on
the expected rebound in global economic growth.

✔ Key objectives will include ensuring India’s greater integration with the global supply chain
and reducing logistics costs.

Incentive schemes
✔ The government remains supportive of incentive schemes. However, it has been working to
revamp existing export schemes so they are in sync with WTO stipulations.
✔ The Service Exports from India Scheme (SEIS) is expected to be revamped with a wider coverage of
businesses, offering exporters duty credit scrips at five to seven percent of the net foreign exchange
earned.

✔ For merchandise exporters, Remission of Duties and Taxes on Exported Products (RoDTEP) is
expected to be a part of the new FTP, which offers reimbursement of central, state, and local
taxes/duties. It replaces the previous Merchandise Export from India Scheme (MEIS), which was not
compliant with WTO rules.

✔ Currently, negotiations are underway to expand the beneficiaries of RoDTEP. This is because there
has been much disappointment among industry and trade stakeholders (and are key to the country’s
export base) who have been left out of the remit of the new RoDTEP scheme, such as
pharmaceutical, steel, and chemical industries; export-oriented units (including bio-technology parks
and electronic hardware technology parks); Special Economic Zones (SEZ); free trade warehousing
zones and custom bonded warehouses operating under the Manufacturing and Other Operations in
Warehousing Regulations etc.

✔ Another trade promotional scheme is the Export Promotion Capital Goods (EPCG), which facilitates
the import of capital goods for manufacturing to augment the competitiveness of India’s exports.
 Focus on new bilateral trade pacts

✔ Following its withdrawal from the RCEP, India is actively working to forge new trade partnerships with other
countries.
✔ India has launched negotiations with the UAE, aiming to conclude trade talks and sign a mutually beneficial
Comprehensive Economic Partnership Agreement (CEPA) by March 2022. The CEPA deal aims to improve
bilateral economic relations, expand existing trade and investment relations, and could be a stepping-stone
to expanding India’s trade ties with the UAE’s neighboring Gulf countries – presently dominated by energy
items.
✔ Progress is also being made around an India-EU free trade agreement as negotiations resumed after an
eight-year halt. Political convergence on key regional and global issues provide background support
as formal talks on two key pacts on investment protection and geographical indications began in September.
✔ Meanwhile, India-UK talks are set to enter a new stage in November, with hopes to reach an Interim
Agreement by March 2022, followed by a Comprehensive Agreement.
✔ While it seems that foreign trade is on path to recovery, COVID-19 has certainly affected the ambitions of
countries worldwide. The pandemic necessitated national spending to boost exports and foreign trade, but
that has stretch government budgets thin, including India’s.
✔ Even prior to the pandemic, India faced massive capital requirements to improve infrastructure, R&D,
logistics, etc. to establish a competitive advantage over Asian and global rivals. Consequently, it
has liberalized market access and since last year, launched sector-specific incentive (PLI) programs to
develop industrial ecosystems around key product segments.
✔ Even prior to the pandemic, India
faced massive capital requirements to
improve infrastructure, R&D, logistics,
etc. to establish a competitive
advantage over Asian and global rivals.
Consequently, it has liberalized market
access and since last year, launched
sector-specific incentive (PLI)
programs to develop industrial
ecosystems around key product
segments.
✔ India’s government has its priorities
well laid out and plans to work
consistently on removing
long-standing obstacles to boost jobs
creation, trade growth in services and
merchandise, and privatization
through investment facilitation.
 Future focus:

✔ Expanding trade flows, diversifying trade items.

✔ Experts predicted foreign trade to bounce back in FY 2021-22. Now in Q3 FY 2021-22, recovery is afoot with
exports growing to US$33.1 billion in August, 45 percent higher than this period last year. Since the beginning of
the current financial year, exports have amounted to an estimated US$163 billion. The target for exports for the
current financial year is set at US$400 billion, and one India is set to achieve.

✔ According to India’s Minister for Commerce and Industry, Piyush Goyal, last year [India’s] services export was
US$194 billion, and goods was US$290 billion. He said, as reported in the Economic Times, “We would like both
services and goods exports to compete with each other and together reach the US$2 trillion mark”. He also said
the export target for the textiles sector was US$44 billion.

✔ Goyal also brought attention to the fact that India is trying to diversify its trade portfolio; cotton and
cotton-based textiles dominate Indian exports, but work is underway to shift to man-made fiber and technical
textiles, which now dominate international textiles trade. In a related development, India recently unveiled its
production-linked incentive scheme for these segments in the textiles sector. This illustrates the government’s
broad thinking and linkages between manufacturing aspirations and trade opportunities.
✔ Meanwhile, to gauge India’s recent positive trade performance despite the pandemic, it must be
noted that a major proportion of the increase in exports is attributed to shipments of petrol and
diesel. Official data showed the export of petroleum products was up by 139 percent in August to
US$4.6 billion – driven by a spike in global prices, compared to an increase in non-oil exports by 36.6
percent to US$28.6 billion.

✔ Another factor is the economic rebound experienced by major economies from the beginning of
2021. US-India trade in goods showed an increase of 40 percent in June this year and is expected to
surpass pre-COVID-19 pandemic highs. The Chinese economy also put behind the downturn in 2020,
growing 18.3 percent in the first quarter of 2021, though slowing down in the second quarter.

✔ With that in mind, it is important to consider the economic health of the entire network of world
trade when evaluating the prospect of any single nation. The steady rebound of economies
worldwide can be interpreted as a strong sign but breakdowns in multilateral relations, geopolitical
rivalries, or supply chain blockages due to COVID shutdowns, logistics barriers, and steep shipping
and container costs indicate some more pain is in store in the near term for international trade.
 Challenges to India’s Foreign Trade Development
✔ Effects of Global Trade Cycle

✔ Technological Differences

✔ Competition from other countries

✔ Poor Product Standards

✔ High Costs

✔ Infrastructural Bottlenecks

✔ High risk and uncertainties

✔ Neo-protectionism
 Preliminaries for Export

A. Strategy and Preparation for Foreign Trade

✔ P’s of international marketing (4 P’s common product, price, promotion & place) 9
additional P’s, resulting into 13 (payment, personnel, planning, practices, paperwork,
partnership, policies, positioning, protection

✔ International Marketing plan

focus on executive summary, marketing objectives, product/service analysis, market analysis,
competitive analysis, segmentation, marketing strategy, implementation, evaluation.

✔ Assessing a Product’s market potential

✔ Making Export/import decisions
✔ Approaches to international marketing
B. Identifying Foreign Markets

✔ Firm related factors

• Ethnocentrism (home country orientation)
• Polycentrism (host country orientation)
• Regio centrism (regional orientation)
• Geo centrism (world orientation)

✔ Market related factors

• Economic factors
• Economic policy
• Business regulations
• Political factors
• Trends
• Market accessibility
C. International Market Selection Process
✔ international marketing objectives
✔ Parameters for selection
✔ Preliminary screening
✔ Shortlisting the markets
✔ Evaluation and selection
✔ Test marketing
✔ Commercial production

D. Methods of Entering International Markets

✔ Exporting
✔ Licensing
✔ Franchising
✔ Contract manufacturing
✔ Contract marketing
✔ Joint ventures
✔ Foreign direct investment
✔ Merger and acquisition
E. Constraints in Entering Foreign Markets
✔ Political embargo
✔ Political instability
✔ incompatibility of technical standard
✔ Trade barriers
✔ Trade blocs

F. Export Contract
All export order are invariably quoted on the basis of detailed documentation and written agreement
signed by both importer & exporter known as export contract.

Elements of export contract

✔ Name and address of parties
✔ Product standard and specifications
✔ Quantity of product
✔ Inspection details
✔ Contract value & taxes
✔ Terms of Delivery
✔ Terms of Payment
FOB contract
Free on board (FOB) is the most frequently used price quotation in the international market.
Under this quotation, the exporter undertakes to pay all expenditure till loading of goods on
the board the ship, including documentation charges. All expenditure thereafter ocean freight,
marine insurance, unloading charges are borne by the importer.

CIF contract
Under the Cost, Insurance and Freight (CIF) contract, the seller has same obligations as under
Cost and Freight (C&F) contract but with the addition that he has to procure marine insurance
against buyer’s risk of risk or damage to goods during carriage.
The seller contracts for insurance and pays the insurance premium.

Note: Force Majeure in export contract

Force majeure means act of god or factors beyond the control of parties that makes the performance of
the contractual obligations impossible, such as wars, floods etc.
parties are relieved of their
obligations on happening of such event and contract come to an end.
 G. Exchange Earner’s Foreign Currency (EEFC) Account
It is an account maintained in foreign currency with an authorized dealer category- 1 bank i.e. a
bank authorized to deal in foreign exchange. It is a facility provided to the foreign exchange earners,
including exporters, to credit 100 % of their foreign exchange earnings to the account, so that the
account holders do not have to convert foreign into rupees and vice-versa thereby minimizing the
transaction costs.
Features
✔ Name of the account
✔ Extent of credit
✔ EEFC account for SEZ units
✔ Permissible credits
✔ Permissible debits
Export Procedures

✔ Registration stage

✔ Pre-shipment stage

✔ Shipment stage

✔ Post shipment stage

 Registration stage

An exporter is required to register his organization with a number of institutions and authorities which directly and
indirectly help him in the smooth conduct of export trade.
✔ Registration of organization
e.g., a joint stock company under companies act, 2013

✔ Opening Bank Account

Authorized by RBI to deal in foreign currency transactions

✔ Obtaining Importer Exporter code (IEC)

Issued by Director General of Foreign Trade (DGFT)

✔ Obtaining permanent account number (PAN)

✔ Registration with Tax authorities

✔ Registration with Export Import Council (EPC)

✔ Registration with Export Credit and Guarantee Corporation of India (ECGC)

✔ Registration with other authorities like Federation of Indian Export Organisation (FIEO)
 Pre- shipment Procedure

✔ Approaching Foreign buyers

✔ Inquiry and offer

Is a request from a prospective importer about description of goods. Inquiry is processed by exporter by making
it as offer in the form of PERFORMA INVOICE.

✔ Confirmation of order

✔ Opening letter of Credit (LOC)

✔ Arrangement of Pre-shipment of goods

✔ Packing and marking

✔ Pre-shipment inspection

✔ Central Excise Clearance

✔ Obtaining Insurance Cover

✔ Appointment of C&F agent

 Shipment procedure

✔ Reservation of shipping space

✔ Arrangement of internal transportation up to the port of shipment

✔ Preparation and processing of shipment documents

Letter of credit along with export contract or export order
commercial invoice (2copies)
Packing list
Certificate of origin
GR form
ARE-I form
Certificate of inspection, where necessary & Marine insurance policy

✔ Customs clearance

✔ Obtaining “ carting Order” from the port trust authorities

✔ Obtaining “let Export order” from the customs examiner

✔ Obtaining “let ship order” from the customs preventive officer

✔ Obtaining mate’s receipt and bill of lading

Post shipment Procedure

✔ Submission of documents by C&F agent to exporter

✔ Shipment Advice to importer

✔ Presentation of documents to bank for negotiation

✔ Dispatch of Documents

✔ Acceptance of Bill of Exchange

✔ Letter of Indemnity

✔ Realization of Export Proceeds

✔ Processing of GR form

✔ Realization of Export Incentives

 Excise Clearance for exportable goods
Excise duty is a tax imposed by the central government on goods manufactured in India. It is collected at
source. The exporter are totally exempted from the central excise duty. However, necessary clearance must
be obtained by the exporters in one of the following ways:

Export under Rebate

Under this an exporter is required to pay excise initially and can claim it from central excise department after
the shipment of goods.

Export under Bond

Under this, an exporter is required to execute a bond in the favour of excise authority, for a sum equivalent to
the amount of excise chargeable on such goods. Such bond is supported by an appropriate bank guarantee to
safeguard excise department’s financial interest against non-sanctioning of excise refund.
 Conditions and limitations (under payment of excise duty)

✔ Excisable goods shall be exported after payment of duty, directly from a factory or warehouse.
✔ Excisable goods shall be exported within six months from the date on which they were cleared for export.
✔ Rebate claim by filling electronic declaration shall be allowed from such place of export and such date, as
may be specified by board in this behalf.
✔ Market price of the excisable goods at the time of exportation is not less than the amount of duty claimed.
✔ Amount of rebate of duty admissible is not less than 500₹.

Conditions and limitations (under without payment of excise duty)

✔ Exporter is required to furnish a general bond (surety or security) to Assistant Commissioner or Deputy
Commissioner of central excise having jurisdiction over the factory or warehouse of the exporter or the
maritime commissioner for the sum equivalent to the duty chargeable on goods.
✔ The manufacturer exporter may furnish a letter of undertaking in the form specified in lieu of a bond.
✔ The goods must be exported within six months from the date on which these were cleared for export.
✔ When the goods are to be exported from a place other than registered factory or warehouse, the excisable
goods as packed in original condition should be identifiable as to their origin.
Procedure for Central Excise Clearance for Export
1. Application to the Assistant Collector of Central Excise (ACCE) 2. Information to the Range Superintendent
3. Sealing of Goods 4. Processing of ARE-I forms
5. Examination of goods at the place of export 6.Submission of claim
7. Verification of the application 8. Refund of duty
9. Cancellation of documents (if the excisable goods are not exported, the assistant commissioner of central excise or
deputy commissioner of central excise cancels the export documents on request of the exporter.

Processing of ARE-I form

ARE-I ARE-I ARE-I ARE-I ARE-I
(original) (Duplicate) (Triplicate) (Quadruplicate) (Quintuplicate)

Submitted to the superintendent or inspector of Central Excise

Returned to exporter/his agent Retained by the range Returned to

superintendent exporter

Submitted to the commissioner of custom at the port of shipment

Returned to Sent to maritime commissioner or excise Returned to exporter

exporter/his agent rebate audit section in case rebate is to for claiming incentives
claimed by EDI
Quality Control and Pre-shipment Inspection
To promote export of quality goods as per international standards, GOI has introduced compulsory quality control and
pre-shipment inspection for 90% of the items of export as per (Quality Control and Pre-Shipment Inspection) Act, 1963.

Objectives
✔ To fulfil commitments to WTO
✔ To ensure Quality of exports
✔ Instilling Confidence among foreign buyers
✔ To minimize impediments to foreign trade
✔ To built image
✔ To comply with International laws

Methods of Quality Control and Pre-shipment Inspection

✔ Self Certification
✔ In process Quality Control
✔ Consignment wise Inspection
 Marine Insurance Policy

It is a contract under which the insurer undertakes to indemnify the insured against losses,
caused due to perils of the sea. Here, perils of the sea include:
✔ Sinking of ship
✔ Damage to the ship and cargo due to dashing of waves.
✔ Dashing of the ships on rocks
✔ Fire or explosion on the ship
✔ Spoilage of cargo due to sea water
✔ Destruction of ship/cargo by crew or captain of the ship, piracy and such other risks.

Section 3 of the marine insurance act,1963 defines a contract of marine insurance as an

insurance cover for marine cargo, air cargo and post parcels. Thus, marine insurance covers
transportation of goods by any of the following modes of transit singly or jointly:
✔ Sea, air or land
✔ Inland water voyages
✔ Rail/road
✔ Air
✔ Post
Procedure for Marine Insurance Policy
1. Selecting Insurance company
2. Deciding Appropriate type of Policy
3. Application to the insurance company
4. Payment of Premium
5. Issue of insurance Policy
6. Processing of the policy

Types of Marine Insurance Policy

On the basis of subject matter
✔ Cargo insurance
✔ Hull insurance
✔ Freight Insurance
✔ Liability Insurance

On the basis of Duration

✔ Time policy
✔ Voyage Policy
✔ Mixed policy
On the basis of terms

✔ Construction risk policy

✔ Port risk policy
✔ Floating policy
✔ Open Cover Policy

Procedure for filling Marine Insurance Claim

1. Intimation of loss
2. Appointment of the surveyor
3. Landing Remarks
4. Submission of Claim
5. Finalization of the claim
Thank you