Having a share in the global trade is important for any developing country. Exporting one country’s products in the international market not only enhances the international trade but also earns foreign exchange for the country. Every country has its own set of rules and regulations that need to be followed while making exports. Procedure for export in India is quite lengthy and may take days and months on a go to be fully realized.
The entire export procedure in India is explained below in a step-wise manner. Whether you are already into this business or are about to start exporting in India, a look at the entire process discussed below is a must to experience a smooth trade without any glitch.
1. Receiving The Order Enquiry
Once the exporter has advertised for the product, a number of prospective buyers will send enquiry requests. It is important to find out whether the person is genuine or not. For that, the exporter sends a letter asking about the prospective buyer’s experience, status/standing, area covered, details of the firm they are already dealing with and mode of good purchase. Once satisfied with the information provided by the probable buyer, the exporter can jump to the next step.
2. Scrutinizing The Order
One should ensure indulge in a deep check of the buyer’s country; what restrictions are there on import, whether he/she would be able to make the payment or not etc. One should talk about the mode of payment, the schedule of delivery and the documents that can be required like commercial invoice, bill of exchange, bill of lading, certificate of origin etc. The export process should comply with the regulations of both importing as well as the exporting country.
3. Acknowledging The Order
After taking into consideration all the regulations, the order can be confirmed and should be acknowledged. A letter of confirmation needs to be sent comprising of acknowledgement receipt, delivery schedule, price, mode of shipping, packaging & marking details and the details of the bank.
4. Procuring The Goods
One of the main steps is arranging/procuring the goods. The goods that are being manufactured or procured should be as per the buyer’s specification and should be ready by the delivery date.
5. Getting Excise Clearance
Getting excise clearance of goods is the next step in the Indian export procedure. The exporter can either pay the duty at the time of exporting and get a refund later or take the other method of not having to pay the excise duty in the first hand. One needs to fill a bond in form B-I (General Security) or form B-I (General Surety). In this process, the Central Excise Office monitors the consignment and also sees that the form AR-4 has been applied for or not. While exporting the goods, this bond is then discharged after checking the application form.
6. Getting The Goods Inspected
Export in India requires a compulsorily added step of goods inspection for selected goods. An application has to be made to the Export Inspection Agency (EIA) along with some documents like commercial invoice, fee draft, export contract and technical specifications of the buyer.
7. Getting Insurance Policy
The exporter gets the goods insured from any damage or loss during the transit. CIF contract requires the exporter to get insurance while FOB and C&F contract require the importer to do the same. Marine Insurance Policy is one such policy.
8. Shipping Of Goods
Goods are shipped either by air or via sea based on the quantity of goods. The exporter hires clearing and forwarding agents to perform various shipping tasks. These agents have to be given certain documents like commercial invoice, originals of export order & letter of credit, GR-I form, AR-4 form, inspection certificate, excise gate pass, declaration form, list of materials and the railway receipt.
9. Preparing The Shipping Bill
The shipping bill has to be prepared in the next step. This bill consists of various things like details of importer and vessel, agent’s name, port & final destination, details of exporter, details of the goods, packaging marks, origin country, code number, details of GR-I for & AR-4 form, license number of exporter and the real value of the goods. This bill is presented to the Superintendent of port, which is then passed to the appraiser dock who returns it with other documents. A duplicate copy of this bill is given to the customs department’s preventive officer who passes it with a ‘Let Export’ order.
10. Getting The Mate’s Receipt
Mate’s Receipt is an important document that is attested by the ship’s captain. It is received after all the dock dues are cleared. This document is a proof that goods have been loaded on the vessel. This receipt is then delivered to the Port Commissioner’s shed. One can obtain the necessary documents like bill of lading etc., after showing this receipt to the shipping company.
11. Intimating The Importer About Shipment
In the next step, the importer or buyer is intimated about the shipment along with the details of the goods, the vessel and the delivery schedule. A non-negotiable copy of bill of lading and master document copy are also sent to the importer from the exporter.
12. Submitting Documents To The Bank
Various documents have to be submitted to the bank within 21 days of shipment so that the banks and arrange payments. Documents like bill of exchange, invoice, air waybill, bill of lading, foreign exchange declaration, certificate of origin or GSP, inspection certificate etc. Two copies of the above-mentioned documents are then sent to importer’s bank twice so that no documents are lost. The bank certificate and commercial invoice are sent back to the exporter. A duplicate copy of all the bank documents are sent to the Chief Controller of Imports and Exports and the Exchange Control Department of the Reserve Bank of India receives a copy of GR form sent by the bank itself. The entire export process takes 9 months to be completely realized.
From receiving the enquiry for the order to shipping the order and finally getting the payment from the buyer, the procedure for exporting in India is not an easy one. Every step mentioned above must be followed with utter care so that there is no problem while undertaking the export business.
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