Beruflich Dokumente
Kultur Dokumente
INDUSTRIES
SYBMS
Pratik Bhambri
#09
Maninder Singh
#17
Jay Gupta
#21
Anil Jain
#23
Pronoy Kapoor
#25
Vikas Patil
#43
Tanveer Singh
#47
ACKNOWLEDGEMENT
Components of export.
Export procedure.
Policies.
Export Prospects.
Quality Control.
EXPORT POTENTIALS OF SMALL-SCALE
INDUSTRIES
Foreign Trade involves exports and imports. Export trade relates to export of
goods and services. All the countries are interested in promoting exports and
restricting imports to the maximum possible extent. India is one important
player in the global trade. We import goods from many countries and also
export goods to countries. Revolutionary changes are taking place in the
volume, composition and direction of India's export trade. The liberalization
policy of the government since July 1991 has created a most congenial
atmosphere for exports. Both exports and imports are almost free from being
subject to negative list. Under the liberalized conditions of expanding
opportunities, 551 contributions to this sector may be of enormous
significance. In the export business, an entrepreneur needs to know the
export environment and procedures of not only in India but also of other
countries to which the firm's products or services had to be exported. Exports
are an important instrument for the creation of employment opportunities in
small scale industries, cottage industries and in the agriculture sector as well
as in the medium and large-scale industrial sector. In this chapter, we
propose to study different aspects of India's export trade with special
reference to small-scale industries.
This statement is true and relevant in case of developing countries like India
who can export trade as a tool/vehicle of economic growth and development.
Economic development of many countries like Japan, South Korea, Thailand,
etc. is basically due to their export potential. Thus, export trade acts as an
engine of economic growth. Growing export gives many benefits. Economic
growth and generation of massive opportunities within the country are two
major benefits of large-scale exports.
Export trade is the driving force of economic development. It facilitates inflow
of machinery, technology and funds, promotes new industries/economic
activities and provides employment to people through industrial activities.
The economic development of many countries is due to their exporting
capacity. Growing export trade is responsible for their economic growth and
development.
In addition, export trade is also useful for promoting employment
opportunities within the country. India's foreign trade policy is now treated as
an instrument of economic growth with thrust on massive employment
generation.
A number of measures have been initiated for the growth and expansion of
Indian Industry keeping in mind the need for employment generation.
The reduction of duty from 15% to 10% under EPCG scheme will enable the
exporters to import capital goods. This will improve the quality and
productivity of Indian industry: The SSI units have received a boost under this
policy.
SIL on Export of products of SSIs has been increased from 1% 2% as a special
incentive for exports of SSI products; additional 1% SIL on the total value of
exports will be given to export houses and all forms of trading houses.
Under the Gems and jewellery replenishment scheme, third party export
have been allowed so that small exporters are able to sell their products in
the international market and can claim REP licenses based on disclaimer
certificate from the third party exporters like MMTC.
This will increase the export of small-scale industries engaged in Gems and
jewellery business. Building up a strong domestic production base is an
important aspect of the new policy.
This is reflected in the provision aimed at encouraging domestic sourcing of
inputs so as to cut the cost involved in importing goods, which may well be
supplied at equally competitive rates by the domestic industry. All the above
measures will help the Indian industry not only to be globally competitive but
it will also help to produce the items which India was importing earlier.
The EXIM policy has liberalized the imports. 542 items have been transferred
from the restricted list to OGL list and SIL list. 70% of the items are consumer
goods. This may affect the Indian industry, especially the SSI units.
COMPONENTS OF EXPORT:
EXPORT PROCEDURE:
Some of the major steps involved in exporting products are described below:
(a) lDBI:
They provide direct financial assistance to the exporter in participation with
approved commercial bank. Credit is given during the pre-shipment and post
shipment stages.
(c) ECGC:
The export credit guarantee corporation provides financial guarantees on the
basis of the export performance on behalf of the exporter.
(d) STC:
The small industry exporter can obtain export finance from state trading
corporation under its export aid to small-scale industry scheme on
concessional terms.
(a) SSIDO:
The small industries development organization provides Techno Managerial
assistance and extension services as follows:
(i) Identifying the potentials of small-scale units and motivating them to
undertake production of export worthy items.
(ii) Creating export consciousness among the entrepreneurs
(iii) Providing export consultancy services in respect of export
procedures, documentation and export incentives.
(iv) Organizing training programme in export marketing in various
SISI's
v) Sponsoring small-scale unit sale-cum-study teams and trade
delegations to be sent abroad.
(vi) Arranging meetings, seminars and open house discussions in
collaboration with the concerned export agencies.
(vii) Disseminating export marketing information to export worthy
units.
(b) SDI:
The State Directorates of Industries looks after export promotion work in
small scale sector at the state level. Some of these directorates have setup
separate export promotion cells for the purpose.
There are State Export Corporations in certain states and export wings of
Small Industries Development Corporation in other states.
These corporations and wings undertake promotional activities including
arranging and coordinating facilities for export production and marketing for
small industrial products in their respective areas.
Some of them have set up display window and adopted various publicity
measures in different foreign countries with the assistance received from the
state govt.
Some undertake foreign market research surveys, arrange visits by
industrialist to foreign market for creating favourable image of their export
products and also for canvassing business. .
(c) SISI:
The Small Industries Service Institutes render technical assistance and help
small scale units in producing goods for export by way of suggesting more
useful technical process, better plant layout, saving of materials, more
dependable testing apparatus etc. with a view to achieve cost economies &
quality improvement.
Export marketing courses are conducted at all SISIs. The SISI at Mumbai,
Calcutta, Madras and Delhi undertake pre-shipment inspection of export
items.
(3) Raw Material:
The import policy provides certain concession in the allotment of imported
raw materials to small-scale units for export production.
The import accords a grater reference to small-scale units in the matter of
supply of imported raw material required by them.
In general the large unit exporting 25% or more of their production are
entitled to import their raw material required from free currency area to the
extent of 1/3 of their full requirement of raw material.The industrial raw
material assistance centre of the state trading corporation supply imported
raw material to actual users and registered exporters. The small units are
moreover exempted from certain procedural formalities in applying for an
import license.
POLICIES
Objectives:
The first revision to EXIM policy was announced y Shri Arun Jaitley on 31st
March, 2003. The new policy for 2003-04 showers a host of incentives for
exporting communi:: prepares solid ground for accelerated growth in exports.
In the new policy, imports, curbs are lifted and the services exports gets
boost.
The Exim Policy 2002-2007 was replaced by a new Foreign Trade Policy (FTP)
for 2004-2009 in September 2004.
This sudden change and the introduction of new policy was due to the
formation of new UPA government under the leadership of Dr. Manmohan
Singh.
The first annual supplement to the five year's FTP 2004-2009 was announced
on April 9, 2005 and the second annual supplement was announced on 7th
April 2006.
This second supplement is the current foreign trade policy for the year 2006-
2007. The term Exim Policy is now replaced by the term Foreign Trade Policy.
The foreign trade policy focus on sectors such as services and agro-based
industries which are labour-intensive with capacity to generate large-scale
employment opportunities.
Free trade warehousing zones will be set up with hundred per cent FDI.
Merchandise and service exports to reach$300billion by 2009.
Biotechnology parks would be set up and the popular DEPB scheme will
be given continuation till a suitable alternative is introduced.
Special packages for gems and jewellery, leather and footwear sectors.
Duty entitlement passbook scheme rates issue and tax notices under
section 80 HHC to be taken up by P.M.O.
DEPB extended till March 31, 2008, new scheme in next six-months.
Duty-free imports of tools and machinery for handicrafts and gems and
jewellery sector.
EXPORT PROSPECTS
Ministry of Commerce:
Director of Exhibitions:
(vii) Get information about rules and regulations for import levied by a
foreign country.
Trade fair authority brings out four journals which are Udyog Vyapar Patrika,
Journal of Industry and Trade, Indian Export Service Bulletin and Economic
and Commercial News. Journal provides information about special articles of
foreign trade of India, information on country's economy, government trade
policies, etc.
Government of India has set up this institute with trade, industry, universities
and educational and research institutions.
It is an autonomous body registered under the Societies Registration Act.
Their main activities are:
The Commodity Boards have been set up to help the exporters in the export
of traditional items. Commodity Boards are even set-up under the
administration of Ministry of Commerce. They perform the following
functions:
(a) It issues suitable insurance policy to the exporters against possible risks
of export business; and
(b) It provides financial guarantees to banks and exporters against deferred
credit terms.
Advisory Bodies:
Concept of Star Trading House was introduced in 1990. Any exporter or group
of exporters can become star trading house. For registration as Star Trading
House the average annual net foreign exchange earnings should not be less
than Rs. 300 crores in preceding 3 years of base period. The STHs can
dispose off the imported goods to actual users only. The additional licenses
for STHs will be calculated at rate of 15% of the NFE on the total eligible
exports made in the preceding licensing year. Licenses are not negotiable.
Export promotion from small-scale sector has been accorded a high priority in
India's Export Promotion Strategy. It includes simplification of export
procedures and provides incentives to small scale sector for higher
production in order to maximise export earnings. The following schemes have
been formulated to help 5SIs in exporting their products:
Quality Control
According to Alford and Beatly "quality control may be defined as that
industrial management technique or group of techniques by means of which
products of uniform acceptable quality are manufactured."
In simple words quality control is the systematic control of various factors
that affect the quality of the end product. The quality of the final product will
depend on the quality of raw materials used, quality of equipments and
degree of skill and proficiency of the workers, etc. Through quality control
quality standard is ensured, Quality control detects the causes of variations
in the characteristics of the products and indicates necessary adjustments by
which these variations are brought down within the tolerance limit.