Watch the video on how GSP influence the Exports and Imports, sectors affected by GSP, what an exporter should do to grow the Exports business?
Watch the video on how GSP influence the Exports and Imports, sectors affected by GSP, what an exporter should do to grow the Exports business?
In simple words, Exports marketing is nothing but marketing your products across borders.
Marketing is vital in any kind of business. It is the process of getting words out about your services/ products. Unlike domestic marketing, exports marketing is more systematic and strategic.
Exports Marketing commence with a solid market research and analysis. Having a product in hand or knowledge about products is not sufficient to enter exports. A major reason behind novice exporters’ failure is down to imitation of successful people. Simply, IT DOESN’T WORK! Times now support the survival of the smartest fit.
Being smart is not a hard thing. It doesn’t mean making things up or trying to give an extravaganza of trivial stuff.
I remember an old Tamil song ‘Unnai Arinthal nee Unnai Arinthal’ reveals the two main ingredients for the foundation of a successful marketing strategy. First, know about yourself. Second, communicate in such an educating way to manifest as a leader of your subject matter. The aim of this article is to focus on two topics: market analysis for exports and role of digital marketing in exports.
An exporter should have a complete understanding of his/her SWOT about their personality, both on personal and professional front. It is ignored by most of the exporters. Sometimes, they focus either on their strength or on their weakness.
A good SWOT Analysis helps in mapping the strength and opportunity exists. The most common characteristics of successful entrepreneurs are ardent learning and networking. These support in identification of the ways to mitigate the threats and weaknesses.
According to the International trade center, India has an untapped export potential of US$ 209 bn. Indian exporters have a huge opportunity in international trade if the knowledge and skill gaps are addressed. Market analysis is my most favorite part of exports marketing. The successful export strategy begins with a good market analysis. Once you have a product, you should do a deep market analysis. Market analysis should be able to give a clear picture of the size of your target market, competitors, and buyers.
In the International Trade, we compete with three categories of competitors. They are other exporters from our country, exporters from other exporting countries and local distributors of importing market.
Your market analysis should help you identify your advantage over all these competitors. The market analysis then develops into a marketing strategy. Let’s discuss segments of market analysis in exports.
Social: The social developments include factors like consumer behavior, demographics, religion, lifestyles, values, and advertising.
Technological: Focusing highly on technological advancements, factors like innovation, communication, energy, transport, research and development, patent regulations and life-cycle of products are considered.
Economic: Measures of interest rates, international trade, taxes, savings, inflation, subsidies, availability of jobs and entrepreneurship are used to evaluate the consumers’ buying position.
Environmental: Environmental developments involve ecosystem factors such as water, the wind, food, soil, energy, pollution and environmental regulations.
Political: The Political developments can highly influence individuals and organizations. It is important to be aware of likely upcoming shifts in power. Political developments can affect environmental, antitrust, financial markets, trade, and other kinds of laws. Factors dealt include political stability, regulation of monopolies, tax policies, price regulations, consumer protection, jurisdiction, and trade unions.
Understanding the trading relationship between two countries is significant. There are three types of trade agreements: Unilateral, Bilateral, and Multilateral agreements. When a single country imposes a restriction, or loosen restriction on a certain country, it’s called as the Unilateral trade agreement.
Bilateral trade agreements are between two countries to liberate the trade flow mutually between the countries, knowing this kind of agreements help in viable market penetration. Multilateral agreements are the most powerful trade agreements. They give a more competitive advantage for the economies involved.
Exports potential in terms of currency value, give insight about the target market position and viability for an exporter to decide whether it is worth attempting such market.
Trade Intensity is high when a country depends upon a single supplying country. It reveals the competitive advantage of a country, over other competitor countries.
India’s export share (1.8%) in the world is very meager compared to our fastest growing economy. To increase our exports share, we must know about our competitors. India has advantages over competitors in various sectors. But one must utilize the resources available.
One of the perks of exports business is exporting to different countries. If you are doing well in a market, market analysis can be done for other markets too.
Market segmentation analysis is also important for export market analysis. An exporter must have an understanding how his product is being used in a target market. This is like STEEP analysis. But we do a single market analysis to make the product suitable to different segments. Thus, expanding the export potential.
Market concentration analysis helps in finding out whether an importing market is a diversified or monopolistic. Higher market concentration shows that the country offers the better opportunity for a new exporter.
The exercises mentioned earlier, give an insight about your competitors from other exporting countries and help you to identify your advantages over such competitors. Another level of competition is from your own country i.e., other exporters. You must have a clear understanding of local market. This includes industry practice, pricing and payments terms, product knowledge, understanding on packing methods. Certain institutions and Government commercial bodies help in understanding current scenario. Your unique selling features will gain a competitive advantage over others.
To reach out the genuine buyers, you must recognize your target market and buyer persona. Not everyone can sell to every kind of buyers. Once the exporter understands his/her procuring/manufacturing capacity, should target such kind of buyers.
Once marketing analysis is done and an understanding of target market size, competitors, and buyers are acquired, it’s time to develop your marketing strategy. Marketing strategy helps you to strategically do marketing and measure/analyze the result. Let’s see the steps of developing a marketing strategy.
Setting a Goal is the preliminary step. You can have a goal for 1 year, 3 years or 5 years. The goal must be in SMART form. i.e., Specific, Measurable, Achievable, Realistic and Time-Based.
For example: To export to in
You can make it more specific by adding quantity, price, package, and product specification. It’s better to concentrate on one product and one target country to start with.
After setting the Goal, we must identify the marketing channels. Exports Marketing can be done through B2B portals, placing an advert at the relevant magazine, appointing freelancers, your website and social media, networking, trade fairs and exhibitions, utilizing government marketing schemes and promotion councils’ meetings.
An exporter should identify the most effective marketing channels for him/her. Prioritise the order of marketing channels from most effective to less effective.
After prioritizing the marketing channels, each channel has a unique approach. Each approach is to be considered as a project. Do a flowchart of activities for each project. Make sure that the flowchart of activities reflects your goal. Have a timeline for each activity and keep track of the progress.
An effective roadmap/flowchart identifies your weakness/gaps and necessary action for that. Best practice is to involve your team members. Solopreneurs can take the help from a mentor or consultant.
Marketing and sales funnel is a pictorial representation of stages of your buyer before making an order. Your marketing activities should encourage the buyer to move to the final stage. The stages are creating your presence in a marketing channel, replenishing the resources/benefits/process of a marketing channel, receiving an inquiry from a buyer, timely responding to your buyer, progress or drop of inquiry, achieving an order.
Each step should be analyzed for the result. If the inquiry doesn’t progress to next stage, change your course of action. Inbound marketing methodology is the current trend in effective marketing. It’s a method of encouraging the buyers to contact the seller. Digital marketing follows the Inbound marketing methodology.
Digital marketing or data driven marketing is the term used to market a product or service using digital technologies. Digital marketing channels are websites, social media profiles, emails, mobile apps, search engines. Some of the techniques are search engine optimization, search engine marketing, content marketing and automation. Let’s see the role of digital marketing in exports.
Digital marketing plays an important role in international trade. Digital marketing goes beyond just having a website or social media profile. It is a part of brand strategy. Your website and social media profile should reinforce your brand and create a trust in your buyer’s mind.
A good website should be like a digital showroom of your products/services. Buyer should be able to have a proper understanding of your products/service, the purpose of your products/service, benefits of buying from you and people involved in your business, your best practices, frequently asked questions/certifications. Your social media profiles should resonate the same values as your website.
Website performance is very important. The website should be mobile responsive i.e., ability to be configured according to the mobile display. Search engine optimisation (SEO) is a vital feature for a website. Website speed should be less than 3 seconds according to global standards.
More than anything, website content is the key to winning your buyer’s trust. Your content should be educating. It shouldn’t be a copy and paste. Google penalizes such bootlegging websites.
An effective social media profile helps you to build a good network and interact with others. Social media such as LinkedIn, google+, Facebook, Pinterest, Instagram, and Twitter are used for effective B2B marketing.
Consult Kriba specializes in creating content for international trade and audience. If you are looking for a practical, effective and updated online exports/imports course, our EXIM A -Z: A wholesome approach to exim business starts on 05.03.2018. The enrollment is open now with offer. To know more, click here
People from all over India out cried on the announcement of Goods and Services Tax (GST) in India. Is it really going to be a burdening tax to consumers, in the history of India? Or is it the best thing that has happened to the people of India? The most debated hot topic of India over the past few months has been implemented by the Government of India on July 1st, 2017, with the taxes ranging from 0% to 28%. More money is flowing out of customer’s wallet as all manufacturers and service providers started billing in accordance to GST. But the real question, unanswered so far, is whether the populace understands how GST works and avoid being exploited. Let us see.
In the pre-GST era, there were n number of terminologies associated with tax in India. Income tax, Wealth Tax, Property Tax, Import and Export duty, Excise duty, Value Added tax, Service tax, Central sales tax, Customs duty and the list goes on… These taxes were levied by both Central and State governments, broadly classified as Direct Tax and Indirect Tax.
Direct tax is what the taxpayer pays to the government, directly out of his pocket. Income tax, Wealth Tax, Property Tax comes under this category. The government collects tax from the manufacturer, retailer for selling a good or service, which is added to the selling price for the consumer. It is called an Indirect tax, as though the amount is collected from manufacturers and retailers, ultimately the consumer ends up paying it.
Application of Indirect tax started as early as the goods move out of manufacturer’s warehouse. The Central government levied excise duty for all manufactured goods. In a case of imported goods, four types of excise duty were applied. Specific duty is applied for each individual item of imported goods. In other terms, specific duty was levied based on quantity. Ad-valorem duty was charged on the total value of imported goods. Anti-dumping and Countervailing duties were added to them to protect the sales of Indian goods against the sales of imported goods. Excise duties were applied on exports as well, but the exporter can avail rebate once the goods were shipped.
When the manufacturing and consumption of the product or service are within the state, only the taxes of state government were applied. State government tax rates varied from state to state. The Central government received a share of tax in the name of Central Sales Tax only on the sales involving two or more states.
Too many terms used in Indirect tax caused havoc in the minds of people. An ordinary person could not come in terms with the types of tax. A person with less understanding would find it difficult to cope with the types of taxes applicable or not applicable on each item. To avoid any loss, people simply added the tax on top of the entire amount on each step, resulting in cascading of tax. i.e., adding tax for tax amount calculated previously.
The longer the supply chain, a customer had to pay more irrespective of no value addition. In short, the taxes paid by the customer is multiplied by the number of links in the supply chain. To curb the cascading of taxes, VAT and cenVAT were introduced. VAT was applied by state governments and cenVAT by the central government. Though they reduced cascading to some extent, they were not totally effective.
With the implementation of GST, all different types of indirect tax were combined under one roof. Now, there is just one term that needs to be understood.
Goods and Service Tax, commonly known as GST, is a consumption based tax. The goods or service is deemed taxable only when it is consumed by others. Through GST, the central government will get half of tax money. The state in which the goods or service is consumed will get the remaining half. State in which they are manufactured, will not get any share of tax.
GST comprises of three components: CGST, SGST, and IGST. In the intra-state sales of the goods and service, where they are manufactured and consumed within the same state, CGST and SGST are applicable. In inter-state sales, where the goods are manufactured in one state and sold to a person from another state, IGST is applicable.
CGST is Central GST, a term used to denote the share that goes to central government and SGST is state GST, the share to state government. IGST is Integrated GST, combined value of CGST and SGST, collected entirely by the central government, half of which is added as input credit to the government of the state, where the goods are consumed.
Government has fixed 5 different tax slabs as Nil GST, 5%, 12%, 18%, 28%. Goods and services that are essential for survival fall under 5% and 12% slabs, while the luxury goods and services are placed in 18% and 28% slabs.
The goal of GST is to ensure that every person pays their tax properly and to avoid cascading of tax.
The gist of GST is as follows, when the manufacturer sells his product to a wholesaler, will be charging as per GST slab. The wholesaler, while selling the same product to a retailer, should be adding tax only for the difference in the selling price, i.e., the profit margin. The retailer, who in turn sold to the customer, should add tax only for the profit margin. So, the end customer will be paying the tax for the amount that is added at the last stage. In long run, the prices of each good and service will come down.
While filing the tax returns, the retailer must ensure that the wholesaler has filed his returns and wholesaler must ensure that manufacturer has filed his returns, to avoid loss. Thus, the transparency in sales will be confirmed in future.
All these ideas behind GST tax structure will work only when the tax is included in the selling price. If the tax is calculated in addition to the selling price, it results in cascading of tax and yield no benefits to the consumer.
Let us consider below scenario and compare what happens when the tax is included/ not included in selling price:
The manufacturing cost of a product is ₹750, GST slab is 18%. Manufacturer from Tamil Nadu sells to a wholesaler in Tamil Nadu for ₹1003. The wholesaler sells the product to a retailer in Kerala for ₹1150. The retailer sells to a customer in Kerala for ₹1300.
1.Tax is included in Selling price (Idea behind GST):
Manufacturer in Tamil Nadu sells to Wholesaler in Tamil Nadu for ₹1003 inclusive of tax.
The manufacturing cost of the product is ₹750. The manufacturer adds ₹100 as his profit.
Base price of product (cost+ profit) = ₹850
18% tax on ₹850 = ₹153
Total selling price = ₹850 + ₹153 = ₹1003
Central Government CGST – 9%: ₹153/2 = ₹76.5
Tamil Nadu Government SGST – 9%: ₹153/2 = ₹76.5
Wholesaler in Tamil Nadu sells to Retailer in Kerala for ₹1150.50 inclusive of tax.
Base price from Manufacturer is ₹850. Wholesaler adds ₹125 as his profit.
New Base price of product = ₹850 + ₹125= ₹975
18% tax on ₹975 = ₹175.5
Total selling price = ₹975 + ₹175.5 = ₹1150.5
If manufacturer filed his tax = ₹175.5 – ₹153 = ₹22.5
If manufacturer did not file his tax = ₹175.5
Tax split up (Inter-state sales):
Central Government (IGST – 18%): ₹22.5
Kerala Government gets ₹11.25 as input credit (half of tax amount)
If manufacturer pays his tax = ₹125 + ₹153 = ₹278
If manufacturer did not pay his tax = ₹975 – ₹1003 = -₹28
The retailer in Kerala sells to Customer in Kerala for ₹1298 inclusive of tax.
Base price from Wholesaler is ₹975. Retailer adds ₹125 as his profit.
New Base price of product = ₹975 + ₹125 = ₹1100
18% tax on ₹1100 = ₹198
Total selling price = ₹1100 + ₹198 = ₹1298
If manufacturer and wholesaler filed their taxes = ₹198 – ₹175.5 = ₹22.5
If manufacturer did not pay, wholesaler paid tax = ₹198 – ₹175.5 = ₹22.5
If manufacturer paid tax, wholesaler did not pay = ₹198 – ₹153 = ₹45
If both manufacturer and wholesaler did not pay = ₹198
Central Government CGST – 9%: ₹22.5/2 = ₹11.25
Kerala Government SGST – 9%: ₹22.5/2 = ₹11.25
If manufacturer and wholesaler paid their tax = ₹125 + ₹175.5 = ₹300.5
If manufacturer did not pay his tax, wholesaler paid = ₹125 + ₹175.5 = ₹300.5
If manufacturer paid and wholesaler did not pay his tax = ₹125 + ₹153 = ₹278
If both manufacturer and wholesaler did not pay their tax = ₹1100 – ₹1150 = -₹50
Since GST is consumption based Tax and the product is only manufactured in Tamil Nadu, but consumed in Kerala, SGST collected in Tamil Nadu will be handed over to Kerala Government by the central government.
Tamil Nadu Government (Manufacturing state) = ₹0
Central Government = ₹76.5 + ₹11.25 + ₹11.25 (after deducting input credit in IGST) = ₹99
Kerala Government = ₹11.25 + ₹76.5 + ₹11.25 (Input credit from IGST) = ₹99
Manufacturing cost = ₹750
Profit to Manufacturer = ₹100
Profit to Wholesaler = -₹25 to ₹278
Profit to Retailer = -₹50 to ₹300
Tax to Government = ₹198 (State and Central Government)
Cost to consumer = ₹1298
Manufacturer in Tamil Nadu sells to Wholesaler in Tamil Nadu for ₹1000 exclusive of tax.
The manufacturing cost of the product is ₹750. Manufacturer’s profit is ₹250.
Base price of product (cost+ profit) = ₹1000
18% tax on ₹1000 = ₹180
Total selling price = ₹1000 + ₹180 = ₹1180
Tax split up (Intra state sales):
Central Government CGST – 9%: ₹180/2 = ₹90
Tamil Nadu Government SGST – 9%: ₹180/2 = ₹90
Since wholesaler paid ₹1180 for the product, he tends to sell at a higher cost to avoid loss. Wholesaler in Tamil Nadu sells to Retailer in Kerala for ₹1300 exclusive of tax.
Base price from Manufacturer is ₹1000. Wholesaler’s profit is ₹120. Tax amount paid by wholesaler = ₹180.
New Base price of product = ₹1000 + ₹120 + ₹180= ₹1300
18% tax on ₹1300 = ₹234
Total selling price = ₹1300 + ₹234 = ₹1534
If manufacturer filed his tax = ₹234 – ₹180 = ₹54
If manufacturer did not file his tax = ₹234
Central Government IGST – 18%: ₹54
Kerala Government: ₹27 as input credit (half of tax amount)
Total profit for Wholesaler:
If manufacturer pays his tax = ₹120 + ₹180 = ₹300
If manufacturer did not pay his tax = ₹1300 – ₹1180 = ₹120
Since retailer paid ₹1534 for the product, Retailer in Kerala sells to Customer in Kerala for ₹1700 exclusive of tax.
Base price from Wholesaler is ₹1300. Retailer’s Profit = ₹166. Tax amount paid by retailer = ₹234
New Base price of product = ₹1300 + ₹166 + ₹234 = ₹1700
18% tax on ₹1700 = ₹306
Total selling price = ₹1700 + ₹306 = ₹2006
If manufacturer and wholesaler filed their taxes = ₹306 – ₹234 = ₹72
If manufacturer did not pay, wholesaler paid tax = ₹306 – ₹234 = ₹72
If manufacturer paid tax, wholesaler did not pay = ₹306 – ₹180 = ₹126
If both manufacturer and wholesaler did not pay = ₹306
Central Government CGST – 9%: ₹72/2 = ₹36
Kerala Government SGST – 9%: ₹72/2 = ₹36
If manufacturer and wholesaler paid their tax = ₹166 + ₹234 = ₹400
If manufacturer did not pay, wholesaler paid his tax = ₹166 + ₹234 = ₹400
If manufacturer paid, wholesaler did not pay his tax = ₹166 + ₹180 = ₹346
If both manufacturer and wholesaler did not pay their tax = ₹1700 – ₹1534 = ₹166
Tamil Nadu Government (Manufacturing state) = ₹0
Central Government = ₹90 + ₹36 + ₹27 (after deducting input credit in IGST) = ₹153
Kerala Government = ₹36 + ₹90 + ₹27 (Input credit from IGST) = ₹153
Manufacturing cost = ₹750
Profit to Manufacturer = ₹250
Profit to Wholesaler = ₹120 to ₹300
Profit to Retailer = ₹166 to ₹400
Tax to Government = ₹306
Cost to consumer = ₹2006
When tax is included in sales price, everyone in the supply chain will get their profit share and consumer would not feel any burden in spending. If the tax is not included, the entire burden falls on the consumer, while all others get more profit. So, the entire responsibility of bringing down the cost lies with the consumer. They need to ensure that maximum retail prices need to be quoted inclusive of taxes.
GST promotes private consumption rate in a state, as state governments will get their share of tax only when the goods or service is consumed in the state. An increase in Private consumption will increase total demand, which in turn will help in the economic growth of India. If properly executed, it will help in tax reduction in future.
Watch out for the part 2 of this post titled “How to make GST work better for Indian exporters” on our website
India has one of the fastest growing economies in the limelight of global landscape. Indian economy tops in most of the economic growth contributing sectors. Service sectors such as IT enabled services, BPO & KPO, agriculture sector, Motorcycle division of automobile industry and retail market are the pulsating sectors of Indian economy. According to the World Federation of Exchanges, Bombay Stock Exchange and National Stock Exchange of India ranks 11th and 12th in the world respectively.
India has the strongest GDP growth among G20 countries according to Organisation for Economic Co-operation and Development (OECD). India’s tech start-ups hub ranks third largest in the world in a report by NASSCOM. Indian constellation of billionaires is the third largest and ultra-high net worth of households is the fourth largest in the world. RBI data reports that India’s foreign exchange reserves have grown from US$ 360 billion in March 2016 to US$ 366.781 billion in March 2017. The inflation rate is historically low at the rate of 2.6 % in May 2017. The Ease of Doing Business Index for India ranks Ludhiana, Hyderabad, Bhubaneshwar, Gurgaon, Ahmedabad, New Delhi, Jaipur, Guwahati, Ranchi, Mumbai, Indore, Noida, Bengaluru, Patna, Chennai, Kochi, and Kolkata, as the top 17 cities to flourish for entrepreneurs.
Export – led growth hypothesis (ELGH) indicate that Indian GDP has grown with an averaging about 7 percent per annum since 1995 following economic reforms in 1991. India’s export constitutes approx. 1.6% of the total global exports. In line with Ministry of Commerce report, India’s merchandise export registered a 17.48 % year-on-year growth, with US$ 24.49 billion as on Feb 2017. The country has seen a rise in exports by 8.32 % in May 2017. Petroleum, engineering, textiles, and gems & jewelry sectors have shown strong performance in exports during the month. Gujarat, Maharashtra, Tamil Nadu, Telangana, Andhra Pradesh are leading states in exporting from India. Each Indian state is known for their regional fine products in the global market. On the contrary, between 2011 and 2016 India suffered bear market in its traditionally prowess exports such as readymade garments, gems and jewelry, and agricultural products, Cars, diamonds, maize, trousers, make-up and skincare items, handbag, and cotton sweaters.
India’s main export partners are U.S.A, UAE, Hong Kong, China, U.K., Singapore, Germany, Vietnam, Bangladesh, and Belgium. The data on the top 25 importing countries of Indian products can be accessed through Indian Trade portal.
The Government of India has taken a number of initiatives to boost Exports. Ministry of Commerce is officially in charge of trade activities in the country. The government has established institutions to initiate and promote exports, train, and render benefits to exporters. Export promotion schemes are as follows:
MEIS and SEIS are aimed to boost India’s exports. Exports of notified goods/ products to notified markets are granted freely transferable duty credit scrips on realized FOB value of exports in free foreign exchange at a specified rate (2-5%). Exports of notified goods shall be entitled to MEIS benefit provided the FOB value up to INR 25, 000 per consignment, through courier or foreign post office using e-commerce. Visit MEIS for more details. Service providers of notified services are eligible for freely transferable duty credit scrip @ 5% of net foreign exchange earned as per Appendix 3E of FTP 2015-2020.
These schemes enable duty-free imports of inputs with the export obligation for export production. The schemes are Advance authorization scheme, advance authorization for the annual requirement, duty-free import authorization (DFIA) scheme, duty drawback of customs/central excise duties/service tax and a rebate of service tax through all industry rates.
Zero duty EPCG scheme, Post Export EPCG duty scrip scheme, EOU/EHTP/STP & BTP SCHEMES, Towns of Export Excellence (TEE), Rebate of duty on “export goods” and “material” used in manufacturing of such goods, Export of goods under Bond i.e. without payment of excise duty, Market Access Initiative (MAI) Scheme, Marketing Development Assistance (MDA) Scheme, Status Holder Scheme are the available EPCG schemes.
Other exports promotion initiatives are Export Processing Zone, Free Trade Zone, and Special Economic Zones. The main objectives of these initiatives are to attract foreign investments, to promote technology and infrastructure for economic growth, to promote export-oriented activities, ease of importing goods for exporting and to achieve export-led growth.
Export promotion councils and commodity boards are non-profit organizations financially supported by the Government of India. These councils perform both advisory and executive functions to promote the exports of a specific group of products, projects, and services. EPCs play an important role in projecting India as a reliable supplier. They also monitor and encourage the exporters to adhere to the international standards and specifications. EPCs educates the exporters to take advantage of the trends and opportunities in the international markets for the respective goods and services. They are the first point of contact for the exporters regarding any info related to their products. The exporters must become members of the concerned EPCs and commodity boards to avail the benefits. The EPCs will in turn issue RCMC (Registration Cum Membership Certificate) depending on the details furnished by the exporter. There are 27 Export Promotion Councils including commodity boards in India.
Indian Institute of Foreign Trade (IIFT) provides consultancy to export enterprise, conduct training, commodity studies, overseas market surveys. IIFT conducts “Niryat Bandhu @ Your Desktop”, an online certificate program launched by DGFT. Most proficient and experienced faculties are handling each segment of exports procedure. The program is to mentor new and potential exporters.
Indian Institute of Packaging (IIP) is set up by the government of India with the purpose of maintaining packaging standards to be compatible with those of developed countries.
Export Inspection Council (EIC) is responsible for the enforcement of quality control and compulsory pre-shipment inspection of various exportable goods. Five export agencies across the country are under the technical and administrative control of EIC.
Indian Council of Arbitration (ICA) is the apex body for promoting and encouraging amicable settlement of trade dispute.
India Trade Promotion Organization (ITPO) is the premier trade promotion agency to promote exports through trade fairs and exhibitions. ITPO also provides assistance to State Governments in setting up Regional Trade Promotion Centres (RTPC) in the State’s capital and major cities.
Export Credit Guarantee Corporation of India offers insurance to cover the risk of exporting on credit. ECGC provides
There are different policies available to suit the requirement and credit worthiness of an export order.
EXIM Bank of India is a premier financial institution to enhance and to empower the Indian exporters to extend the trade to a new horizon. EXIM Bank offers financial services, marketing advisory services, research and analysis, Export advisory services and term deposit scheme. They launched export facilitation portal, Exim Mitra for trade related and financial product information.
The government of India formulates the foreign trade policies based on facilitating or controlling foreign trade, economic reforms and globalization. Foreign trade policy 2015-2020 is currently followed FTP to promote the exports. These policies are to encourage exporters through incentives, facilitating the technological and infrastructural up-gradation through imports of goods and equipment, activating Indian embassies as key players in the export strategy. The main objectives of FTP are to double the contribution percentage on the global trade and stir the economic growth by generating employment.
India has signed different trade agreements with neighboring and developing countries to promote and ease the international trade. There are 20 trade agreements that are currently in force. They are PTA between India and Afghanistan, India-Africa trade agreement, Asia Pacific Trade Agreement, CECA between India and ASEAN, Agreement on trade, commerce and transit between India and Bhutan, PTA between India and Chile, CEPA between India and Japan, CEPA between India and Republic of Korea, CECA between India and Malaysia, PTA between India and MERCOSUR, Agreement of Cooperation with Nepal to control Unauthorized Trade, Agreement on South Asia Free Trade Agreement, Treaty of Transit between India and Nepal, Agreement on SAARC Preferential Trade Agreement, Revised Treaty of Trade between Government of India and Government of Nepal, CECA between India and Singapore, Free Trade Agreement between India and Sri Lanka, India – Thailand Free Trade Agreement.
Indian products have a good value in the International market. But the credit just doesn’t go to the products alone. India’s geographical location, its climatic condition, vast English-speaking and young population, Entrepreneurial mindset, its ability to reach faster to the global screen are also key strengths of the Indian exports. Indian exports have grown, so as the imports. Indian products are known for the value addition and niche. The majority of the exporters go extra mile for their importers to protect the interest of their buyers. Amidst global demand, uncertainties in the political realm of the developed countries, economic recovery, Government initiatives are real fuel to the Indian export growth.
We cannot ignore the pain points as well. India ranks 130 in ease of doing business according to THE WORLD BANK. The trade deficit shot up to a nearly 30-month high of US$ 13.84 billion because of the increase in gold imports. There is a decline in agricultural output. India needs improvement on many frontiers in ease of doing business. This gives an opportunity to the start-ups. These are the basic information; an Indian exporter should be aware of. There are more to be detailed in the upcoming posts.
Consult Kriba aims to educate and empower Indian exporters to excel in the International trade.
This is my first blog after 6 years. I really wanted to start with something inspiring. I am now working on setting up my own consultancy after being in the International trade since 2011. I thought the journey started when I enrolled in Agilam Institute of Foreign trade for the Diploma in International trade. But it wasn’t! The seed of desire was sown when I was six years old. I loved to sit with my grandfather helping him with his ledger. I got no interest in fairy tales but keen about hearing those real stories of how my grandfather toiled to set up his own empire. I remember him saying that his fifth attempt turned out to be a charm. It registered in my mind that those 4 failures were each step closer to his success. He never looked back after that. He is still that energetic and authoritative (He is 90 years old now). Is he not inspiring? Unquestionably He is (At least to me).
Below is the journey of three women entrepreneurs will inspire you. I feel blessed to have known them personally.
Ramu, aged 52 is from Tirunelveli. She is an LIC insurance advisor and collaborates with her spouse’s rice wholesales business, exports. She became an entrepreneur at the age of 49. She always tells that she wanted to achieve something great in her life. She works round-the-clock and her ambition is to receive an award from the President. Despite all the challenges, she stays motivated by keeping her staunch Christian faith. Her strength is that she motivates herself saying ‘If I can’t, then who can’.
Kruthika is the founder of “vilvah store” – a fresh handmade natural. Kruthika started her venture after her mother’s demise due to over dosage of skin medication. She wanted to spread awareness of fresh and natural skincare and cosmetic products. Spending most of her time in research and development, she brings out the best product for her customers. Though sourcing premium quality raw materials is a major challenge, reviews and positive feedbacks from the customers keeps her motivated. She recognizes that her key strengths are diligence, energy, and aspiration to provide the quality products. For more details, click the links below
Nandhini is a multifaceted business woman. An inspiring and interesting lady. You feel a buzz if she is around. Her excitement about frivolous stuff makes you realize that petite things do make an impact. She is a minimalist actively focussing into zero waste lifestyle in an urban. Her blogs record her thoughts and experiences of her transition being a hoarder to an organized minimalist and a zero waste. It so happened to be influenced as a guidance, motivation, and support to others. While sticking to strict deadlines and grammar anxiety are the significant challenges faced, the amount of love, massive reach, and positive aura contributes to her motivation. Her strength is the ability to connect with varied demographics, choosing relevant topics, and her writing style. Her blog is www.durgeshnandhini.com.
Setting up a business is not an activity, it is an attitude. We are living in one of the best times of entrepreneurial era. We might tend to feel low at times, with no stones turned. It’s enough if you are passionate about being an entrepreneur. Your perseverance will not let you down. There are loads of information, webinars, and authentic materials available on the internet. The government of India is also taking remarkable steps to make India the preferable location to do business. There are many altruistic mentors providing astounding support to budding innovators.
To conclude, I can write about many who influence others in a positive way. These three ladies are just an example. Money is neither an obstacle nor motivating factor for an entrepreneurial spirit.
YOUR PASSION IS THE KEY.