An Internship Report

On
“Market Research and Global Supply chain”
Conducted at

Last Mile Logistics

Associated Global Logistics Pvt. Ltd.

ATC GROUP

Prepared by: Under the guidance of

Udit Birthare Mr. Ravindra Rajwade – Director
MBA (International business) Mr. Osho Dongre - Sales Executive
School Of Economics
D.A.V.V Indore
Batch 2018-2020
1
 Table of Contents:

INTERNSHIP CERTIFICATE ……………………………………………………………… 3

ACKNOWLEDGEMENT ……………………………………………………………… ………….. 4

DECLARATION ……………………………………………………………………………….……..5

EXECUTIVE SUMMARY …………………………………………………………………………..6

CHAPTER 1: Contextual Background …………………………………………………….………..7

Associated Global Logistics Private Limited ……………………………………………….…18

CHAPTER 2: SERVICES RENDERED. ……………………………………………………………..21

CHAPTER 3: MARKET RESEARCH ……………………………………………………………..23

Chapter 4: EXIM Terms, Procedure and Shipment handled instances. ……….….28

Blockchain and the Shipping Industry ……………………………………………………….……..28

CBM Calculations …………………………………………………………………………………….….45

International Commercial Terms (INCO terms) ……….. 47

Instances of Shipments Handled by Associated Global Logistics. …………………...53

CHAPTER 5: Industrial Market Research. (Indore Area) and Inland Container Depot.
………………………………….. ……………………………………………………………………………….. 57

ICD Pithampur Visit ……………………………………………………………………………….60

Main Services offered ………………………………………………………………….........................61

ICD DHANNAD Visit ……………………………………………………………………………………62

BIBLIOGRAPHY …………………………………………………………………………………...63

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INTERNSHIP CERTIFICATE

3
 ACKNOWLEDGEMENT
“Gratitude is not a thing expression; it is more matter of feeling”
The internship opportunity I had with [Associated Global Logistics Pvt. ltd] was a
great chance for learning and professional development. Therefore, I consider
myself as a very lucky individual as I was provided with an opportunity to be a part
of it. I am also grateful for having a chance to meet so many wonderful people and
professionals who led me though this internship period.

Bearing in mind previous I am using this opportunity to express my deepest

gratitude and special thanks to the Executive Director [Associated Global
Logistics Pvt. Ltd] who in spite of being extraordinarily busy with her/his duties,
took time out to hear, guide and keep me on the correct path and allowing me to
carry out my project at their esteemed organization and extending during the
training.

I express my deepest thanks to Mr. Osho Dongre, [Sales Executive and Branch
coordinator] for taking part in useful decision & giving necessary advices and
guidance and arranged all facilities to make life easier. I choose this moment to
acknowledge his/her contribution gratefully.

I perceive as this opportunity as a big milestone in my career development. I will

strive to use gained skills and knowledge in the best possible way, and I will
continue to work on their improvement, in order to attain desired career objectives.
Hope to continue cooperation with all of you in the future,
Sincerely,

Udit Birthare

Place: Indore

Date:

4
 DECLARATION

I am , Udit Birthare, a student of M.B.A. (International Business), 2nd year of School

of Economics, Devi Ahilya Vishwavidyalaya, Indore Completed my summer
Internship training from Associated Global Logistics Pvt. Ltd from 27 May, 2019
to 10 July, 2019.

During the mentioned period I worked on Market research and completed my

summer internship training project entitled “Industrial Market Research and
Global Supply Chain” under guidance of Mr. Osho Dongre (Sales Executive and
Branch Coordinator). The Information submitted is true and original to the best of
my knowledge.

Date : Name

5
 EXECUTIVE SUMMARY

This is the Internship report based on the 45 days long internship

program that I had successfully completed in Associated Global
Logistics Pvt. Ltd (ATC Group) from 27.05.2019 to 10.07.2019
in partial fulfillment of MBA program on School of Economics,
Devi Ahilya University of Indore. As being completely new to
practical, corporate world setting, every hour spent in AGL gave
me some amount of experience all the time of which cannot be
explained in words. But nevertheless, they were all useful for my
career.

This report includes how services being rendered by Associated

Global Logistics in regards to Freight forwarding, Custom house
brokerage, Documentation required in shipping, Allied services,
Area of service, Industrial sectors in Indore area and sea import
and sea export forwarding etc.

I have worked at Associated Global Logistics, Indore branch office

with reference to Market research and Sales execution, Global
supply chain and Documentation procedures as well as Ocean
freight pricing, customer support service and coordination.

6
 CHAPTER 1: Contextual Background

1.1 SUPPLY CHAIN MANAGEMENT

The management of the flow of goods and services, involves the

movement and storage of raw materials, of work-in-process inventory,
and of finished goods from point of origin to point of consumption.
Interconnected or interlinked networks, channels and
node businesses combine in the provision
of products and services required by end customers in a supply chain.

Supply-chain management in commerce has been defined as the "design,

planning, execution, control, and monitoring of supply chain activities
with the objective of creating net value, building a competitive
infrastructure, leveraging worldwide logistics, synchronizing supply with
demand and measuring performance globally.

SCM practice draws heavily from the areas of industrial

engineering, systems engineering, operations
management, logistics, procurement, information technology, and
marketing and strives for an integrated approach.

1.1.1 INDUSTRIAL HISTORY

The 100-year history of supply chain management began with

improvements of basic, labor-intensive processes and progressed to
current day engineering and complex international networks.

The supply chain industry’s beginning of operations research as well as

industrial engineering started with logistics. Fredrick Taylor, the founder

7
 of industrial engineering who wrote The Principles of Scientific
Management in 1911, targeted the process improvement of manual
loading in his work. Operations Research of analytics’ value started
during WWII for logistical military operational solutions in the 1940s.
Industrial Engineering and Operations Research often attempted to
function as separate identities and by using integrated frameworks to
address supply chain and logistics issues they have had successes. The
industry has begun titling this integration “Supply Chain Engineering.”

1.2 LOGISTICS

Management of the flow of goods between the point of origin and the
point of consumption in order to meet requirements of customers or
corporations.

In other words Planning, execution, and control of the procurement,

movement, and stationing of personnel, material, and other resources to
achieve the objectives of a campaign, plan, project, or strategy. It may be
defined as the 'management of inventory in motion and at rest.'

In other words, logistics is the management of the flow of things between

the point of origin and the point of consumption in order to meet
requirements of customers or corporations. The resources managed in
logistics can include physical items such as food, materials, animals,
equipment, and liquids; as well as intangible items, such as time and
information. The logistics of physical items usually involves the
integration of information flow, materials
handling, production, packaging, inventory, transportation, warehousing,
and often security.

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 Logistics industry includes activities such as:
 Warehousing
 Transportation
 Freight Management
 Handling damage claims
 Clearance
 Managing vendors and partners & Much more....
So AGL comes into Freight Management

Logistics management is the part of supply chain

management that plans, implements,and controls the efficient, effective fo
rward, and reverse flow and storage of goods, services, and
related information between the point of origin and the point of
consumption in order to meet customer's requirements. The complexity
of logistics can be modeled, analyzed, visualized, and optimized by
dedicated simulation software. The minimization of the use of resources
is a common motivation in all logistics fields. A professional working in
the field of logistics management is called a logistician.

1.2.1 Supply Chain and Logistics in the Future

After the 1980s, computer technology has far outpaced supply and
logistics utilization. Internet use has skyrocketed, changing our
perceptions of communication. Yet, supply chain and logistics planning
remains centered upon the distributed models after the advent of
personal computing. With academic research, a new generation of supply
chain and logistics planning technology based on centralized planning
with distributed collaboration is in reach. The value of research for the
advancement for traditional supply chain and logistics areas like
warehousing and distribution, transportation, and manufacturing
logistics is exceptional. Multiple non-traditional areas like health care and
humanitarian logistics will also reap remarkable benefits utilizing
traditional supply chain and logistics and the global insights accessible

9
with systematic supply chain and logistics performance research is
immensely valuable to world markets.

1.2.2. INDUSTRIAL HISTORY

In ancient history the combination of local supply for food and forage and
self-containment in hardware and services appears often as the logistic
basis for operations by forces of moderate size. Some of these operations
are familiar to many a schoolchild—the long campaign of Alexander the
Great from Macedonia to the Indus, the saga of Xenophon’s Ten
Thousand, Hannibal’s campaigns in Italy. The larger armies of ancient
times—like the Persian invaders of Greece in 480 BCE—seem to have
been supplied by depots and magazines along the route of march.
The Roman legion combined all three methods of supply in a marvelously
flexible system. The legion’s ability to march fast and far owed much to
superb roads and an efficiently organized supply train, which included
mobile repair shops and a service corps of engineers, artificers,
armourers, and other technicians. Supplies were requisitioned from local
authorities and stored in fortified depots; labour and animals were
drafted as required. When necessary, the legion could carry in its train
and on the backs of its soldiers up to 30 days’ supply of provisions. In
the First Punic War against Carthage (264–241 BCE), a Roman army
marched an average of 16 miles (26 kilometres) a day for four weeks.
One of the most efficient logistic systems ever known was that of
the Mongol cavalry armies of the 13th century. Its basis was
austerity, discipline, careful planning, and organization. In normal
movements the Mongol armies divided into several corps and spread
widely over the country, accompanied by trains of baggage carts, pack

10
animals, and herds of cattle. Routes and campsites were selected for
accessibility to good grazing and food crops; food and forage were stored
in advance along the routes of march. On entering enemy country, the
army abandoned its baggage and herds, divided into widely separated
columns, and converged upon the unprepared foe at great speed from
several directions. In one such approach march a Mongol army covered
180 miles (290 kilometres) in three days. Commissariat, remount, and
transport services were carefully organized. The tough and seasoned
Mongol warrior could subsist almost indefinitely on dried meat and
curds, supplemented by occasional game; when in straits, he might drain
a little blood from a vein in his mount’s neck. Every man had a string of
ponies; baggage was held to a minimum, and equipment was
standardized and light.

In the early 17th century, King Gustav II Adolf of Sweden and

Prince Maurice of Nassau, the military hero of the Netherlands, briefly
restored to European warfare a measure of mobility not seen since the
days of the Roman legion. This period saw a marked increase in the size
of armies; Gustav and his adversaries mustered forces as large as
100,000, Louis XIV of France late in the century even more. Armies of this
size had to keep on the move to avoid starving; as long as they did so, in
fertile country they could usually support themselves without bases, even
with their customary huge noncombatant “tail.” Logistic organization
improved, and Gustav also reduced his artillery train and the size of guns.
In the Thirty Years’ War (1618–48) strategy tended to become an
appendage of logistics as armies, wherever possible, moved and supplied
themselves along rivers exploiting the economies of water transportation,
and operated in rich food-producing regions.

After the Thirty Years’ War, European warfare became more sluggish and
formalized, with limited objectives and an elaborate logistics that
sacrificed both range and mobility. The new science of fortification made

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towns almost impregnable while enhancing their strategic value, making
18th-century warfare more an affair of sieges than of battles. Two
logistic innovations were notable: the magazine, a strategically located
prestocked depot, usually established to support an army conducting a
siege; and its smaller, mobile version, the rolling magazine, which carried
a few days’ supply for an army on the march. Secure lines of
communication became vital, and whole armies were deployed to protect
them. The increasing size of armies and of artillery and baggage trains
placed heavier burdens on transport. Also, a revulsion against the
depredations and inhumanity of the 17th-century religious wars resulted
in curbs on looting and burning and in regulated requisitioning or
purchase of provisions from local authorities. Because of the high cost of
mercenary soldiery, commanders tended to avoid battles, and campaigns
tended to become sluggish maneuvers aimed at threatening or defending
bases and lines of communication. “The masterpiece of a successful
general,” Frederick the Great remarked, “is to starve his enemy.”
The era of the French Revolution and the Napoleonicdomination of
Europe (1789–1815) brought back both mobility and range of movement
to European warfare, along with an immense further increase in the size
of armies. Abandoning the siege warfare of the 18th century, Napoleonic
strategy stressed swift offensives aimed at smashing the enemy’s main
force in a few decisive battles. The logistic system inherited from the Old
Regime proved surprisingly adaptable to the new scale an d pace of
operations. Organization was made more efficient, baggage trains were
pared down and some of their load shifted to the soldier’s back, and much
of the noncombatant tail was eliminated. The artillery train was
increased, and the rolling magazine was used as the occasion demanded.
The heavily burdened citizen-soldier marched faster and farther than his
mercenary predecessor. In densely populated and fertile regions, moving
armies continued to subsist, by purchase and requisition, on the
countryside through which they marched, spreading out over parallel
roads, each corps foraging to one side only. Even so, the numbers
involved dictated greater dependence on magazines.

12
Napoleon made relatively few logistic innovations. He militarized some
services formerly performed by contractors and civilian personnel, but
the supply service (intendance) remained civilian though under military
control. A significant change was the establishment in 1807 of a fully
militarized train service to operate over part of the line of
communication; this was divided into sections that were each serviced by
a complement of shuttling wagons—foreshadowing the staged resupply
system of the 20th century. The 600-mile advance of Napoleon’s Grande
Armée of 600,000 men into Russia in 1812 involved logistic preparations
on an unprecedented scale. Despite extensive sabotage by the Russian
peasantry, the system brought the army victorious to Moscow.

1.3 FREIGHT FORWARDERS

FIATA, the International Federation of Freight Forwarders Associations

and CLECAT, the European Association for Forwarding, Transport,
Logistic and Customs Services, have adopted an official description of
“freight forwarding and logistics services”: "Freight Forwarding and
Logistic Services" means services of any kind relating to the carriage
(performed by single mode or multimodal transport means),
consolidation, storage, handling, packing or distribution of the Goods as
well as ancillary and advisory services in connection therewith, including
but not limited to customs and fiscal matters, declaring the Goods for
official purposes, procuring insurance of the Goods and collecting or
procuring payment or documents relating to the Goods. Freight
Forwarding Services also include logistical services with modern
information and communication technology in connection with the
carriage, handling or storage of the Goods, and de facto total supply chain
management. These services can be tailored to meet the flexible
application of the services provided.

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 1.3.1 WORKING OF FREIGHT FORWARDERS

There is a lot that goes into arranging your international shipping. While
the freight forwarder handles the details of your international shipping, it
is important to know what a freight forwarder does not do in order to
understand what a freight forwarder actually does.

A freight forwarder does not actually move your freight itself.

The freight forwarder acts as an intermediary between a shipper and
various transportation services such as ocean shipping on cargo ships,
trucking, expedited shipping by air freight, and moving goods by rail.
A freight forwarding service utilizes established relationships with
carriers, from air freighters and trucking companies, to rail freighters and
ocean liners, in order to negotiate the best possible price to move
shippers’ goods along the most economical route by working out various
bids and choosing the one that best balances speed, cost, and reliability.

Freight forwarders handle the considerable logistics of shipping goods

from one international destination to another, a task that would
otherwise be a formidable burden for their client.
Export.gov puts it this way:
To comply with export documentation and shipping requirements, many
exporters utilize a freight forwarder to act as their shipping agent. The
forwarder advises and assists clients on how to move goods most
efficiently from one destination to another. A forwarder’s extensive
knowledge of documentation requirements, regulations, transportation
costs and banking practices can ease the exporting process for many
companies.

It usually provides a full range of services including:

 Tracking inland transportation,
 Preparation of shipping and export documents,
14
 Warehousing,
 Booking cargo space,
 Negotiating freight charges,
 Freight consolidation,
 Cargo insurance,
 Filing of insurance claims.

1.3.2 INDUSTRIAL HISTORY

One of the earliest freight forwarders was Thomas Meadows and

Company Limited of London, England, established in 1836. According to
"Understanding the Freight Business," written and published by the
executive staff of Thomas Meadows and Company in 1972, the advent of
reliable rail transport and steamships created demand for the fledgling
freight forwarding industry. Trade developed between Europe and North
America, creating additional demand. The first international freight
forwarders were innkeepers in London who held and re-forwarded the
personal effects of their hotel guests.

The original function of the forwarder was to arrange for carriage by

contracting with various carriers. Forwarder responsibilities included
advice on documentation and customs requirements in the country of
destination. His correspondent agent overseas looked after his
customers' goods and kept him informed about matters that would affect
movement of goods.
In modern times, the forwarder accepts the same responsibilities. It
operates either as a domestic carrier or otherwise with a corresponding
agent overseas or with his own branch-office. In a single transaction, the
forwarder may be acting as a carrier (principal) or as an agent for his
customer or both.

15
1.4 COMPANY BACKGROUND

1.4.1 ATC GLOBAL LOGISTICS PVT. LTD

Popularly known providing Total Logistics Services. We are one of the

leading Custom House Agent (Custom Broker), International Freight
Forwarder, IATA Air Cargo Agent, Licensed Multimodal Transport
Operator, Import - Air Consolidator, Export Ocean Consolidator /
(Groupage) and specialised Exhibition Forwarder in India, dealing with
all your Transport, Logistics and Cargo requirements by sea, air and road.
Founded in 1957, ATC registered a continuous and sustained growth and
continues to be financially well - consolidated. We have constantly
enhanced the service profile & coverage as ATC, we are a Full Service -
Pan India group of companies.

The company has kept pace with changing times increasing needs of
clients and has widened range of customised services. To ensure effective
handling of cargo the company has specialised divisions for import and
export, sea and air, custom clearance / international freight forwarding.
With an extensive network of associates in all major countries, we are
also exclusive member of United Shipping Associates.

16
 1.4.2--ATC at glance

 Founded in 1957

 PAN INDIA Company

 Total Logistics Solution

 Offer Services by Air, Sea, Road & Multimodal

 Door to Door Service

 24 Offices in 17 Cities In India

1.4.3--A.T.C. GROUP COMPANIES

 A.T.C. (Clearing & Shipping) Pvt. Ltd.(Custom Clearance)

 Associated container Line Pvt. Ltd.(NVOCC)

 Associated Global Logistics Pvt. Ltd.(Import Ocean Forwarding)

 Associated Consolidation Services Pvt. Ltd.(Import Air Forwarding)

 Associated Warehousing Co. pvt. Ltd.(Open Warehouse)

 Associated Transport Company (Road Transport)

 B.M.Associates

 S.M.E.Logistics Pvt Ltd

17
1.5 COMPANY PROFILE

Associated Global Logistics Private Limited

Company Details

CIN U63090MH2003PTC141100

GSTIN
Company Name ASSOCIATED GLOBAL LOGISTICS PRIVATE LIMITED
Company Status Active
RoC RoC-Mumbai
Registration
141100
Number
Company Category Company limited by Shares
Company Sub
Non-govt company
Category
Class of Company Private
Date of
30 June 2003
Incorporation
Age of Company 16 years +
Supporting and auxiliary transport activities; activities of
Activity
travel agencies

18
1.6 - INTRODUCTION

Associated Global Logistics Private Limited is a Private incorporated on

30 June 2003. It is classified as Non-govt company and is registered at
Registrar of Companies, Mumbai. Its authorized share capital is Rs.
5,000,000 and its paid up capital is Rs. 500,000. It is involved in
Supporting and auxiliary transport activities; activities of travel agencies

Associated Global Logistics Private Limited's Annual General Meeting

(AGM) was last held on 30 September 2018 and as per records from
Ministry of Corporate Affairs (MCA), its balance sheet was last filed on 31
March 2018.

Directors of Associated Global Logistics Private Limited is Ravindra

Sadashiv Rajwade.

Associated Global Logistics Private Limited's Corporate Identification

Number is (CIN) U63090MH2003PTC141100 and its registration
number is 141100. Its Email address is audit@atc.in and its registered
address is 901 PENINSULA TOWER GANPATRAO KADAM MARG LOWER
PAREL MUMBAI MH 000000 IN , - , .

Current status of Associated Global Logistics Private Limited is - Active

They are Full service - PAN India Logistics provider in the business
since 1957. They offer exciting career opportunities across our
verticals viz ocean import, ocean export, air import and air export.
We also offer openings in supporting functions of finance,
administration, sales & marketing, Operations management, and I.T.
We are based at more than 26
locations across India, giving you a wide range of choice. At ATC, you
don't need to restrict yourself to your profile. We open a world of

19
opportunities for you where you can explore- innovate- learn and
create.
We have a rich heritage of more than 50 years into the business and
have been earning goodwill in the market for our ethical practices.
We stand for the values of truthfulness, dedication, integrity,
innovation and excellence.

We nurture our employees in this value based and friendly culture.

We are a diversified family of 325+ members,
inclusively working together. We strive for a safe, positive and
learning work environment where mistakes are seen as
opportunities to
learn and superiors are actually your mentors. You will be part of a
cooperative and sharing team where you learn from your colleagues.
We
are committed to our inspiring and empowering H. R. Principles and
expect your commitment as well.

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 CHAPTER 2: SERVICES RENDERED.

2.1 ASSOCIATED GLOBAL LOGISTICS PVT. LTD.

Associated Global Logistics (AGL) is focused and specialized in

Ocean Import Freight Forwarding. The dedicated team of
Professionals provides personalized service with keeping track of
cargo from getting ready till delivery at port / factory.

AGL is certified as ISO 9001:2008 compliant organisation.

Numerous Customers’ acknowledgements and referrals
demonstrate our commitment to excellence in service quality,
and a continued focus on improving the customer experience.
2.2 Service Offered under AGL :
● Competitive Ocean freight :

○ LCL –FCL – Break Bulk – Multimodal

● Collection of Consignment (Ex Works)

○ Pre-carriage arrangements

○ Documentation

○ Customs / port formalities, in the country of

Shipment and Transit.

○ Packing

○ Third Party Inspection

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 ● Tracking and Monitoring of consignments

● Pre-scrutiny of documents

● Follow up with suppliers

● Multiple Supplier Consolidation

● Door to Door / Integrated Logistics

● Import Customs clearance at destination (using services of ATC

and SME)

● DAT / DAP ( DDU / DDP) Capable

● Dismantling of Used machinery

● Site Handling : Shifting & Installation

● Special logistic services :

○ Project Forwarding

○ Hotel + Construction Forwarding

○ Exhibition Forwarding

○ Third Country exports

○ Transit cargo to Nepal and Bhutan via Kolkata.

○ Delivery Order : Time (20 minutes)

● ISO - activity and benefit

22
 CHAPTER 3: MARKET RESEARCH

3.1 Industrial Sector

Location & Geographical Area.

Indore is located in the western region of Madhya Pradesh, on the
southern edge of the Malwa plateau. It lies on the bank of Saraswati and
Khan Rivulets, which are tributaries of the Shipra River and has an
average elevation of 553.00 meter above mean sea level.
,Indore is often referred as the commercial capital of Madhya Pradesh
with a bulk of its trade coming from Small, Mid and Large scale
manufacturing & service industries. These industries range from
Automobile to 3 Pharmaceutical and from Software to Retail and from
Textile trading to Real estate. Major industrial areas surrounding the city
include the Pithampur Special Economic Zone and the Sanwer Industrial
belt. (MSME, 2019)

23
 3.2Existing Status of Industrial Areas in
Indore Region.

S.No. Industrial Area Working units

1. Sanwer Road (Sector A, B, C, D, E and F) 1500

2. Pithampur Industrial Area 309

Distt Dhar - Sector 1,
Sector 2(SEZ and Non SEZ) 105
Sector 3(SEZ) 543
3 Laxmi Bai nagar, Ditt Indore 102

4 Pologround, Distt Indore 287

5 Dewas Indutrial Area, Distt Dewas 203

6 Dewas-Ujjain Road Industrial Area, Distt 192

Dewas
7 Hatod, Distt Indore 67

8 Bhagirathpura, Distt-Indore 18

24
 3.3 Industry Products Range
 Major Export Items

Textile and Ready made Garments

Pharma Products
Food Products
Namkeen and Sweets
Soya Products
Cold rolled steel coil/Steel

Auto Parts

Industrial Packaging and Supply

Engineering Units

 Growth Trend In general, the Industries are growing at 7-8%

annually.
 Vendorisation / Ancillarisation of the Industry- Soya, Pharma,
Readymade Garments & general Engineering Units are having
ancillary units who are catering to their needs.

25
 Major import Items
Chemicals

Machinery

Plastics

Electrical Machinery

Vegetable Oil

Aluminium

Non- Ferrous Metal

Engineering Units

26
3.4 Details for Identified cluster

Name of the Principal Products Major Issues / Access to

cluster Manufactured in requirement Export
the Cluster Market
Pharma Cluster Pharma compounds WHO-GMP Norms, exports have
and Formulations Technology Up increased
gradation. Common appreciably from
Testing & R&D 19.3 crores to 120
Facilities, Export crores.
Marketing, etc.
Readymade Garment. Shirts, Trousers Jeans, Tech up gradation, export has rose
Dresses For Boys Girls Training(Skill from 50 crores to
Development ) 70 crores
through ATDC (AEPC)
Namkeen Namkeen Products Effluent treatment There is export of
plant, Raw material Rs. 2 crores, from
Bank, setting up of the cluster
lab, Manufacturing of
sugar free sweets
Plastic Packaging HDPEPipes,Woven Sacks, Raw Material, Testing Exporting to
Films & Plastic Bags Facilities, Lack of many countries
Trained /Skilled
persons Developmen

27
Chapter 4: EXIM Terms, Procedure and
Shipment handled instances.
4.1 Block Chain

Blockchain and the Shipping Industry

With the advancement of technology, industries endeavor to incorporate

it into its operations. It leads them to evolve a way of functioning that
optimizes their productivity while simultaneously reducing the cost and
time involved. And the thing about technology is that there is always
scope for further improvement.

28
One such major technological advancement of the last two decades that
has taken all industries of the world by storm is the Blockchain
Technology. What was invented in 2008, speculatively by Santoshi
Nakamoto, as a public transaction ledger for the cryptocurrency, Bitcoin;
has now evolved into a more comprehensive system that is used in all
industries, from oil companies to the transportation industry and the
medical world.

So, what exactly is the Blockchain Technology?

Blockchain refers to a public ledger system that maintains a record of

information. It is a decentralized, peer-to-peer network that is used to
record financial or transactions of any other kind. A piece of information,
once recorded onto the Blockchain, in the form of an encrypted block,
cannot be altered or deleted. Even at the time of entering a transaction
into the ledger, it is only admitted once a majority of the participants have
accepted and approved the transaction. Therefore, with the Blockchain
Technology, there can be no apprehensions about the authenticity of the
records or about the information being mishandled or edited to suit the
vested interests of few.

What is the significance of the Blockchain Technology?

Blockchain Technology is a technologically advanced substitute of the

traditional pen and paper book-keeping. Where the conventional manual
paperwork meant huge maintenance costs and was prone to clerical
errors and open to frauds and mismanagement; Blockchain offers a
digital ledger that ensures a secure database which is easy to create and
impossible to manipulate.

29
It is especially useful for record keeping when the transaction is taking
place between more than two parties. This is because the distributed
ledger accessible through multiple locations at the same time, ensures
that all concerned parties have access to all the information they need at
all times.

Blockchain Technology and the Maritime Industry

One of the industries that is soon to be revolutionized with the

incorporation of the Blockchain Technology is the Shipping and the
Maritime Industry. This is an industry that has always been saddled with
the weight of extensive paperwork. One way of understanding the
predicament of the Shipping industry is through the Trail of Roses.

The Trail of Roses was a project undertaken by Maersk, world’s largest

container shipping company, in 2014. The company followed a
refrigerated container filled with roses and avocados as it was being
transported from Kenya to the Netherlands. The company found that the
shipment travelled from the farm to the retailers in about 34 days. Out of
these 34, 10 days were wasted away due to a misplacement of some
critical documents.

Maersk said that, “The paperwork and processes vital to global trade are
also one of its biggest burdens. The paper trail research that Maersk did
uncovered the extent of the burden that documents and processes inflict
on trade and the consequences.”

Flash-forwarding to 2018, Maersk is working in association with the

International Business Machines Corp., to employ the Blockchain
Technology to enable real-time cargo and documents tracking.

30
So, what are these benefits of the Blockchain Technology for the Shipping
and Maritime Industry that Maersk is attempting to harness?

How can the implementation of the Blockchain technology benefit the

Shipping Industry?

Adapting the Blockchain Technology in its operations can have the

following advantages for the Shipping Industry –

• Reduced paper documentation

The conventional method of documentation demanded that a copy of the

bills of ladle be sent to multiple parties like the commander of the ship
and the party receiving the shipment. This was both an expensive and a
time-consuming task, as the documents had to be manually sent to the
location prior to the date of receiving of the shipment.

With Blockchain, the parties can simply create a digital ledger of the
goods loaded on to the shipment and all related information. This
common ledger can then be accessed by all stakeholders, from all
locations easily.

• Eliminates unnecessary delays

Since, there is no paperwork to begin with, Blockchain eliminates the

delays and discrepancies that are accompanied by paperwork records.
The data once added on the Blockchain as a record, cannot be tempered
with, deleted or misplaced. Therefore, there are no chances of
unnecessary delays that might end up disrupting the flow of the
shipment.

31
• Reduced costs

Digital records mean that there is an immediate reduction in the costs

incurred by the shipping company in maintaining, updating and storing
all records of its shipments. It also liberates the company from the extra,
unforeseen expenditure on replacing the misplaced documents.

• Real-time data

Blockchain allows its users to keep the record of transactions updated at

all times. Since, it is a decentralized record, there can possibly be no
delays in updating the ledger about the real time location of the shipment
and the expected time of arrival at the destination.

Blockchain solves a lot of the problems that the Shipping and Maritime
Industry has been facing for years. But, it is by no means a conclusive
solution. It seems to fall short of expectations when people compare
Blockchain with EDI. The two imply very different things for the shipping
industry. This I exactly the kind of resistance that Blockchain faces.

Being a developing technology that the market is still familiarizing itself

with, the Blockchain Technology, has a long way to go before it can be
absorbed in all industries. The lack of knowledge about Blockchain, or
mis-knowledge about it, affects the general attitude towards the
Blockchain technology. Like the misunderstanding between the Public
and the Private Blockchains. There are no Private Blockchain ledgers. It is
a myth. Authentic Blockchain are all solely Public Blockchains. Add to
this, the fact that a lot of industries are still lacking in the infrastructure
that is required in setting up a Blockchain ledger; and there is another
example of how far Blockchain still has to go.

32
 4.3 EXPORT PROCEDURE

1. RECEIPT OF AN ENQUIRY

2. ACKNOWLEDGEMENT OF EXPORT ORDER

3. SCRUTINY OF THE EXPORT ORDER

4. ARRANGING THE GOODS- EXPORT PRODUCTION

5. EXPORT LICENSE/QUOTA REQUIREMENTS

6. CENTRAL EXCISE CLEARANCE

7. APPLY TO EXPORT INSPECTION COUNCIL FOR THE INSPECTION

8. APPLY FOR MARINE INSUARANCE

9. ISSUE INSTRUCTION TO THE C&F AGENT

10. CUSTOM CLEARANCE

11. SHIPMENT ADVICES TO IMPORTER

12. PRESENTATION OF DOCUMENTS BY BANK

13. PROCESSING OF DOCUMENTS BY BANK

14. DUTY DRAWBACK

33
Step1. Receipt of an enquiry: Exporter locates a trade enquiry i.e. he comes
acrothe details of a foreign buyer who is willing to import the items. On the receipt of
his basic information, the foreign buyer puts forward his requirements. Once the
product has been identified, them the process of negotiations of other terms and
conditions begins. Exporter sends the proforma invoice to the foreign buyer setting
out in detail the terms and conditions negotiated between the two parties. This
invoice represents the "offer to sell" made by the exporters. To the importer it may
be on the other documents also.

Step 2. Acknowledgement of the Export order: Exporter should send an

acknowledgement letter to the importer. Stress should be laid on building of long
term business relationship based on mutual trust.

Step 3. Scrutiny of the export order: Before sending the confirmation order,
exporter should check for all terms and conditions including: Product specification,
size, Quality, quantity Terms of payment Delivery schedule Inspection Documents
like commercial invoice, bill of Lading, Insurance etc. Labeling, Packaging, Marking
Price (FOB value)

Step 4. Arranging the goods export production: As soon as the export has been
confirmed or finalized, preparation is made for the production or procurement of
the goods to be exported. Goods manufactured must comply with the description of
the goods given in the export given in the export order, together with a copy of
instruction given by the importer.

Step 5. Export License/ Quota Requirements: item being exported requires an

export license, the exporter from the licensing authority should procure the same.

Step 6. Central Excise Clearance: Excisable goods can be imported either Under
claim for rebate of excise duty Under bond In the case of former, the duty is first
Paid and its refund is claimed after exportation and in the later case the goods are
allowed to be exported without payment of duty provided a bond in executed Before
excisable goods are removed from the factory with an application in form ARE for
claiming rebate of excise duty The exporter them presents when the goods have
been removed from the factory a copy of this application together with the goods to

34
the customs collector at the port who will certify that the goods have been actually
exported.

Step 7. Apply to Export Inspection Council for the Inspection: will depute an
inspector for carrying out quality control and inspection of exportable products. If
consignment found is according to the prescribed specification, inspecting officer
seals each packet. A certificate of inspection is issued by the inspection agency.
Original is valid for custom purpose, which ensures that only the consignment whose
details are given on the certificate is permitted for shipment.

Step 8. Apply For Marine Insurance (If CIF): The exporter should obtain
insurance policy in duplicate. At this stage, all the formalities in relation to
certificate of origin, ECGC etc. should be completed.

35
 Step 9. Issue Instruction to the C&F Agent: A Detailed note is prepared for the
clearing and forwarding agent, giving instruction regarding the shipment of the
consignment a master document and form of bank guarantee should be forwarded
to the forwarding agent.
Step 10. Custom Clearance Procedure: CHA prepares the shipping bill and presents
them along with other document to the export department of the custom house. The
custom appraisal examines the documents and appraises the value of the goods. If
everything is in order, he endorses the duplicate copy of the shipping bill and
indicates the extent of physical examination to be carried out the docks. Then all the
documents except the GR-1 form, original Shipping Bill and a copy of Master
Documents are returned to the CHA for presentation to the appraisal

Step 11. Shipment Advices to Importer: Intimation is sent to the importer,

indicating the date dispatch and the name of the ship by which they have been sent
along with the non-negotiable copies of bill of Lading and Master Document.

Step 12. Presentations of Document by the Exporter to Bank:

l. Master Document

2. GR-1 (duplicate and triplicate)

3. Full set of Bill of Lading and no-negotiable copies

4. Original L/C

5. Bank Certificate

6. Export Contract

7. Marine Insurance (duplicate)

8. Bill of Exchange

Step 13. Processing of Documents by Bank: Bank examines the document with
reference to the terms and conditions of the original order and also the L/C
Exporter's Bank screens the above documents and sends a set of the following
documents the Importer's Bank

36
1. Master Document (original Copy)

2. Marine Insurance Policy

3. Negotiable Bill of Lading (original Copy)

4. Bill of Exchange (original Copy) The bank sends GR-1 form (duplicate) to the ECD of
the RBI Triplicate copy is sent to RBI on receipt of Payment from abroad.

Bankers return the following documents to exporter

l. Original copy of Bank Certificate

2. Attested copies of Master Document.

The exporter receives Payment against the above documents. The bankers also send
to the concerned joint Chief Controller of import and export a duplicate copy of the
bank certificate.

Step 14. Duty Drawback: The exporter files a claim with the concerned maritime
collector of Central Excise for rebate on the Central Excise duty or for getting credit
in his bond account as the case may be. For central Goods, Which are manufactured
In India, are liable in excise tax, but if you export those goods, you get exemption the
duty

l. First you pay the duty and ask for rebate

2. Execute the bond

37
 How to prepare an Export Invoice. Contents of Export commercial Invoice:

An exporter’s point of view, invoice is the prime document in business. Pl

find below the contents of Invoice:

1. Exporter / Consigner: The detail of party who consigns the goods is

mentioned in this column. The name and complete address of consignor to be
mentioned with Country name.

2. Consignee: The details of party to whom the consignment is shipped out to

be mentioned.
Normally, the details of overseas buyer are mentioned. In s
third party, said column can be mentioned as“To Order”

3. Buyer: In some cases, consignee may not be the actual buyer. Then the
details of buyer other than the consignee are mentioned.

4. Invoice Number and date: This number is the serial number of sale
transaction used by a seller. This reference number is quoted at many occasions
including authorities to identify the consignment for future reference. This is the
reference number against the said sale used internally by the buyer in all future
reference and files in office also.

5. Buyer’s order number and date: The purchase order number of overseas
buyer is mentioned here. If the shipment is under Letter of credit,
the LC number and date is mentioned.

6. Other reference if any: You can mention any other reference number to be
declared in related to the said shipment or common.

7. Country of Origin: The country of goods originally manufactured to be

mentioned in this column. In some of the cases, the goods are imported to a country
and the same goods are exported after re-packed and re-balled. It happens in
triangular shipments also. Read more about ‘triangular shipment’ in my previous
article.

38
8. Country of final destination: This is the country where the goods are finally
reached.

9. Vessel / Flight: The name of vessel or flight if available. You can also mention
the planning vessel or planning flight name. While mentioning vessel name, always
write voyage number.

10. Pre carriage by: The term “Pre carriage by” means the mode of movement
of cargo to port of loading by the shipper. The Pre carriage can be ‘By road’,
‘By Rail’ ‘By air’ or ‘By sea’.

11. Place of Receipt: Place of receipt of goods by carrier after completing

export customs procedures. If you (exporter) are situated far from load port, the ca
‘place of receipt’ and ‘port of loading’ will be the same.

12. Port of Loading You can mention the port of loading of goods. It can be
airport or sea port of place where you load your goods to aircraft or vessel.

13. Quantity: Number of quantity against which you are selling. Say, you
are selling your product per piece and packed 10 pieces in o n c e package
and total 10 packages. Means, you are selling 100 pieces. You mention in
‘quantity’ column as 100 pieces. If you are selling on per kg basis, you
mention ‘100kgs’ in ‘quantity’ column.
14. Port of Discharge: This is the port where your goods are
unloaded from the aircraft or ship to deliver to the buyer’s place. Be aler
port of discharge column. You can imagine, what happens if the same got changed. Shippin
bill. Once Bill of Lading released with the change of port of discharge, your cargo
will reach to destination where you mentioned ‘the port of discharge’ in the Invoice.

15. Place of Delivery: If your buyer is located far from port of discharge and
he need to get the goods near to customs supervised ware house (Container freight
station CFS), t h e Bill of Lading issued at port of loading has to be
mentioned the staid place of delivery. Once goods unloaded at port of
discharge by ship or aircraft, the cargo is moved to the said location. This is the
place where importer files customs documents for import and take delivery of
cargo. In other words, responsibility of carrier to deliver the
goods is up to this place. Importer has to move the goods from place of
delivery to final destination of goods at his cost.

39
16. Terms of Delivery & Terms of Payment:
As I have explained in previous articles, the terms of delivery like EX- wor

17. Marks and number: The details of ‘marking’ you have done on parcels to be
exported. Also the number mentioned on the parcel.
Suppose you have 10 packages to be exported. You have
labeled or marked as 1, 2, 3, .10 serial numbered on each parcel, and written
complete address of consignee and your address under respective heads. Here, you
write marks and numbers as, “01 – 10” “As addressed” in the column of ‘marks and
numbers’. The proper marking and labeling is very
important while shipping less container load (LCL).
18. Number and kind of packages: In this column, you need to mention the total
number of packages in the said particular shipment. If you export total 10
packages you can mention 10. As you know, there are various kinds of packaging
modes. For example: wooden box, drums, corrugated
carton boxes, pallets etc. depends up on the nature of cargo. So
you can mention the mode of packages you packed the said 10 parcels. If
you have packed the said 10 parcels as pallets, you can mention the
column of ‘number and kind of packages’ as ’10 pallets’.

19. Description of Goods: The Description details of goods are mentioned in this
column. Also be alerted that if the shipment is under Letter of Credit,
the words mentioned on LC to be matched exactly with your words in
documents. I personally suggest, if any spelling error occurred while
releasing Letter of credit, let the same spelling error be in the documentation if
not changing the meaning of whole body of description.
By this statement, I would like to make you remember once again
about the importance of accuracy to be maintained in documentation
matching with the words of Letter of Credit.
Hope you followed me.

20. Rate: In the column ‘rate’, you have to mention the unit selling price of
goods. Say, rate per piece, rate per kg. Etc. If you sell at USD 10 per piece,
you can mention USD 10.00.

40
21. Amount: The amount of said goods is mentioned here... As per the above
example, you mention USD 1000.00
22. Total: If you do not have further items to be included, you can mention the
total amount of invoice. Say as per above example: USD 1000.00

23. Amount in words: Please note the amount in words to be matched with
the amount in figures mentioned.

24. Declaration: While declaring and signing the invoice means, you are stating
all information given in invoice is true. The words of declaration mentioned in the
invoice may differ from country to country based on their respective law.

25. Authorized signatory, rubber stamp and Date: Means, the person signs on
invoice with rubber stamp of the firm. Authorized signatory means, the person to
who the exporter authorize to sign invoice on behalf of the exporter.

41
 How to prepare an Export packing list. Contents of Export Packing list

1. Exporter / Consigner: The detail of party who consigns the goods is

mentioned in this column. The name and complete address of consignor to be
mentioned with Country name.

2. Consignee: The details of party to whom the consignment is shipped out to be

mentioned. Normally, the details of overseas buyer are mentioned. In some cases,
when Letter of credit involves, the bank name is mentioned as consignee starting
with “To
The order of…” If the cargo is re-sold at destination to a third party, said column can
be
Mentioned as “To Order”
3. Buyer: In some cases, consignee may not be the actual buyer. Then the details
of buyer other than the consignee are mentioned.
4. Invoice Number and date: This number is the serial number of sale
transaction used by a seller. This reference number is quoted at many occasions
including authorities to identify the consignment for future reference. This is the
reference number against the said sale used internally by the buyer in all future
reference and files in office also.
5. Buyer’s order number and date: The purchase order number of overseas
buyer is mentioned here. If the shipment is under Letter of credit, the LC number
and date is mentioned.
6. Other reference if any: You can mention any other reference number to be
declared in related to the said shipment or common.
7. Country of Origin: The country of goods originally manufactured to be
mentioned in this column. In some of the cases, the goods are imported to a country
and the same goods are exported after re-packed and re-balled. It happens in
triangular shipments also. Read more about ‘triangular shipment’ in my previous
article.
8. Country of final destination: This is the country where the goods are finally
reached.
9. Vessel / Flight: The name of vessel or flight if available. You can also mention
the planning vessel or planning flight name. While mentioning vessel name, always
write voyage number.
10. ‘Pre carriage by’: The term “Pre carriage by” means the mode of movement
of cargo to port of loading by the shipper. The Pre carriage can be ‘By road’, ‘By Rail’
42
‘By air’ or ‘By sea’.
11. Place of Receipt: Place of receipt of goods by carrier after completing export
customs procedures. If you (exporter) are situated far from load port, the cargo can
be customs cleared at nearest Container Freight station and move to port of loading.
If you are completing customs procedures near the load port, the column ‘place of
Receipt’ and ‘port of loading’ will be the same.
12. ‘Port of Loading’: You can mention the port of loading of goods. It can be
airport or sea port of place where you load your goods to aircraft or vessel.
13. Port of Discharge: This is the port where your goods are unloaded from the
aircraft or ship to deliver to the buyer’s place. Be alert, the port of discharge column
should be filled up with best care. If you handle documentation for different
shipments at time, there are chances to get interchanged the port of discharge
column. You can imagine, what happens if the same got changed. Shipping Bill is
prepared on the basis of Invoice to file with customs clearance procedures. Bill of
Lading is prepared on the basis of customs clearance completed shipping bill. Once
Bill of Lading released with the change of port of discharge, your cargo will reach to
destination where you mentioned ‘the port of discharge’ in the Invoice.
14. Place of Delivery: If your buyer is located far from port of discharge and he
need to get the goods near to customs supervised ware house (Container freight
station CFS), the Bill of Lading issued at port of loading has to be mentioned the
staid place of delivery. Once goods unloaded at port of discharge by ship or aircraft,
the cargo is moved to the said location. This is the place where importer files
customs documents for import and take delivery of cargo. In other words,
responsibility of carrier to deliver the goods is up to this place. Importer has to
move the goods from place of delivery to final destination of goods at his cost.
15. Terms of Delivery & Terms of Payment: As I have explained in previous
articles, the terms of delivery like EX-WORKS,FOB,C&F,C&I,CIF,DDU,DDP etc. as
agreed both you and your buyer. Terms of Payment also as explained earlier like LC,
DA, DP etc.
16. Marks and number: The details of ‘marking’ you have done on parcels to be
exported. Also the number mentioned on the parcel. Suppose you have 10 packages
to be exported. You have labeled or marked as 1, 2, 3, .10 serial numbered on each
parcel, and written complete address of consignee and your address under
respective heads.
Here, you write marks and numbers as, “01 – 10” “As addressed” in the column of
‘Marks and numbers’. The proper marking and labeling is very important while
shipping
Less container load (LCL).
43
 17. Number and kind of packages: In this column, you need to mention the total
number of packages in the said particular shipment. If you export total 10 packages
you can mention 10. As you know, there are various kinds of packaging modes. For
example: wooden box, drums, corrugated carton boxes, pallets etc. depends up on
the nature of cargo. So you can mention the mode of packages you packed the said
10 parcels. If you have packed the said 10 parcels as pallets, you can mention the
column of ‘number and kind of packages’ as ’10 pallets’.
18. Description of Goods: The Description details of goods are mentioned in this
column. Also be alerted that if the shipment is under Letter of Credit, the words
mentioned on LC to be matched exactly with your words in documents. I personally
suggest, if any spelling error occurred while releasing Letter of credit, let the same
spelling error be in the documentation if not changing the meaning of whole body of
description. By this statement, I would like to make you remember once again about
the importance of accuracy to be maintained in documentation matching with the
words of Letter of Credit. Hope you followed me.

19. Remarks
20. Dimension
21. Net weight
22. Gross weight

23. Declaration: While declaring and signing the invoice means, you are stating
all information given in packing list is true. The words of declaration mentioned in
the invoice may differ from country to country based on their respective law.
Authorized signatory, rubber stamp and Date: Means, the person signs on
invoice with rubber stamp of the firm. Authorized signatory means, the person to
who the exporter authorize to sign invoice on behalf of the exporter.

44
 4.4 CBM Calculations
 CBM Calculation Formula :
Length (centimeter) x Width (centimeter) x Height (centimeter) /
1,000,000 = Length meter x Width meter x Height meter = Cubic
meter (m3) .
e.g. 35 cm x 35 cm x 45 cm = 0.055 cbm
 CFT Formula : Length" x Width" x Height" = ? divided 1728 = Cubic
feet (CFT)
 KT Formula : Pounds divided by 2204.62 = Kiloton (Kt)

45
4.4.1 CBM FOR LCL
The method of calculation of volume of cargo under sea LCL
shipment

CBM means Cubic Meter. However, the total weight of cargo should not
exceed 1 ton. That means, if the cargo weight is above 1000kgs, the
volume of cargo is treated on the basis of weight. In short, freight
forwarders charges LCL rate on the basis of ‘per CBM’ or per weight
of 1000kgs (1 ton) whichever is higher. CBM – cubic meter is
calculated by multiplying length, width and height of packages of goods.

For example,

If the length, height and width of a cargo is 2.3 meters, 1.4meters and 2
meters respectively, the volume of cargo is 2.3 X 1.4 X 2.00 = 6.44 CBM. If
you have the measurement in inches or centimeters, first you need to
convert in meters and then calculate CBM which will be easier for you. If
freight forwarder quote a rate of USD 10.00 per CBM, the rate will be 6.44
CBM X USD 10.00 per CBM = USD 64.40.

If the weight of the said package is 7 tons (7000kgs), the freight on LCL is
calculated on the basis of weight. That is, 7 tons X USD 10.00 = USD 70.00.
So, weight of 1 ton (1000kgs) is treated as 1cbm. In other words, the LCL
freight is calculated on the volume of 1 CBM or weight of 1 ton (1000kgs)
whichever is higher.

46
 4.4.2 LOAD ABILITY OF OCEAN CONTAINERS

 20ft container approximately 26-28 CBM

 40ft container approximately 55-58 CBM
 40ft HQ container approximately 60-68 CBM
 45ft HQ container approximately 78 CBM

4.5 International Commercial Terms (INCO terms)

To facilitate commerce around the world, the International Chamber of

Commerce (ICC) publishes a set of Incoterms, officially known as
international commercial terms. Globally recognized, Incoterms prevent
confusion in foreign trade contracts by clarifying the obligations of
buyers and sellers. Parties involved in domestic and international trade
commonly use them as a kind of shorthand to help understand one
another and the exact terms of their business arrangements. Some
Incoterms apply to any means of transportation; others apply strictly to
transportation across water.

The ICC developed Incoterms in 1936 and updates them periodically to

conform to changing trade practices. Because of these updates, contracts
should specify which version of Incoterms they use—e.g., Incoterms 2010
(the latest version). Trade terms used in different countries may appear
identical on the surface, but they can have different meanings when used
domestically.
KEY TAKEAWAYS

47
Traders use Incoterms to help understand one another in domestic and
international trade.
The ICC developed Incoterms in 1936 and updates them periodically to
conform to changing trade practices.
Typical examples of Incoterms rules for any mode of transportation
include "Delivered at Terminal," "Delivered Duty Paid," and "Ex Works
(EXW)."

1. EXW Ex Works
Ex Works (EXW) is the term used to describe the delivery of goods to
an available designation at their place of business, normally in their
factory, offices or warehouse.
The seller does not need to then load items onto a truck or ship, and
the remainder of the shipment is the responsibility of the buyer (e.g.
overseas shipment and customs duty). EXW is therefore more
favorable to the seller as they do not need to worry about the freight
once it has left their premises.
2. FCA Free Carrier
Unlike EXW, Free Carrier pushes the responsibility of delivering the
goods to the buyers nominated premises onto the seller, so they
have to organize shipping and various export documents.
3. CPT Carriage Paid To

48
“Carriage Paid To”, or CPT, goes into a little more detail than FCA,
specifying that the seller bears the costs for transporting the goods
to the nominated place that the buyer requests.
Carriage Paid To can be used in any transport mode, and the risk
transfers from the seller to the buyer as soon as the goods reach the
nominated destination and the carrier takes charge of these.

4. CIP Carriage and Insurance Paid To

“Carriage and Insurance Paid to”, or CPI, specifies that the seller
needs to pay the costs of transport as well as the insurance cover for
the goods in transit (by any transport mode) to the destination
named by the buyer.
In terms of level of insurance, the cover level can be minimum,
defined by the ICC’s INCO Terms, and should they request a higher
level of insurance, this would need to be agreed on the contract.
The risk is then transferred from the seller onto the buyer once the
goods reach the nominated point.

5. DAT Delivered At Terminal

“Delivered at Terminal”, or DAT, means that all of the costs up until
the point of delivery to a nominated terminal (e.g. a port or a quay)
need to be covered. As in the table above, the buyer would need to
arrange Duties and Taxes and clearing goods through customs. With
DAT, the seller is also responsible for unloading the goods at the
terminal.

49
It’s advisable to ensure the terminal, hub or port is clearly specified,
given the size of many terminals.
6. DAP Delivered At Place
“Delivered at Place”, or DAP, can also be used for any mode of
transport. An extension of DAT, the seller delivers the goods at a
named destination, specified by the buyer, although under the ICC
rules, the unloading of the goods are the responsibility of the buyer.
The buyer is also required to sort out duties and taxes, as well as
clearing the goods through customs.
7. DDP Delivered Duty Paid
“Delivered Duty Paid”, or DPP, can be used for any mode of
transport. In this case, the seller is responsible for delivering the
goods at a place specified by the buyer, up to the point of unloading.
Unlike DAP rules, the seller is also required to pay for all Duties and
Taxes, clear the goods for import and pay relevant taxes.
DPP is often complex as shipment of goods into a market are often
best left to local experts (e.g. the in-market buyer), so it’s a less
commonly used INCO Term.
8. FAS Free Alongside Ship
“Free Alongside Ship”, or FAS, is used in situations when the seller
can place the goods alongside other non-containerized goods (e.g. on
a vessel or barge).
The seller might do this if they have access to sea or inland
waterway routes and want to place the goods en route to the buyer

50
alongside other goods on the ship. It’s not recommended for goods
that can be placed in a container (more on this below, see FCA).
The risk of transporting the goods ‘alongside ship’ move from the
seller to the buyer once the goods are delivered to a terminal or port
and unloaded.
Free On Board (FOB)
“Free On Board”, or FOB, occurs when the seller delivers the goods
to the port of shipment, at which then it becomes the responsibility
of the buyer once unloaded onto a vessel. If the goods are damaged
when on board the vessel, it’s the responsibility of the buyer.
10. CFR Cost and Freight
“Cost and Freight”, or CFR, incurs more risk and responsibility onto
the seller. The seller delivers the goods up and takes all
responsibility and cost right up until the ship has docked at the end
point and the goods have been unloaded. The seller will also cover
the cost of insurance at at least the minimum level.
11. CIF Cost, Insurance and Freight
“Cost, Insurance and Freight”, also known as CIF, is also restricted to
sea or inland waterway modes of transport. In this case, the seller
insures the goods transported up until they arrive at the port, but it
becomes the responsibility of the buyer (in terms of risk and
insurance).

51
Group 1. Inco terms that apply to any mode of transport are:
EXW Ex Works
FCA Free Carrier
CPT Carriage Paid To
CIP Carriage and Insurance Paid To
DAT Delivered at Terminal
DAP Delivered at Place
DDP Delivered Duty Paid

Group 2. Incoterms that apply to sea and inland waterway transport only:
FAS Free Alongside Ship
FOB Free on Board
CFR Cost and Freight
CIF Cost, Insurance, and Freight

52
 4.4: Instances of Shipments Handled by
Associated Global Logistics.
 Imports Instances as per Inco.terms:
Vendor Industrial Area Mumbai, Maharastra
And Industry Type (Manufacturer of a wide range of
products which include Floor
Hardener, Impact Hardtop Flooring
Services, Fibermesh Polypropylene
Fibres, HC Cosinus Joints and
Novocon Steel Fibres. )
Port Of Loading Quindao, China(Qingdao is a
major city in the east of
Shandong Province on China's
Yellow Sea coast.)
Port Of Discharge Nhava-Sheva Port, Mumbai
Inco Terms FOB
Cargo LCL
Commodity Disc and Blade of Power Trowel
Gross weight 3545 KGs
Net weight 3315 KGs
No. of Packages/Pallets 3
Nature of Commodity
Volume 2.9 CBM1
 We will Release booking of intended vessel schedule to shipper & release B/L, tracking of
shipment till arrival at Nhava Sheva and movement to CFS, Scrutiny of documents, Correct
Filling of Manifest, Release of Endorsement at destination. Once shipment is on Board. Our
rates does not include Insurance Charges.

1
 CBM Calculation Formula : Length (centimeter) x Width (centimeter) x Height (centimeter) / 1,000,000 = Length meter
x Width meter x Height meter = Cubic meter (m3)

53
 Export Instances as per Inco.

1.
Vendor Industrial Area Ujjain Road Industrial Estate
And Industry Type (The firm was engaged in manufacture and
sale of water pumps for domestic application
for OEM’S)
Port Of Loading Nhava-Sheva, Mumbai
Port Of Discharge Tai-Chung
Inco Terms CIF
Cargo LCL
Commodity Water Pumps
Gross weight 300kg

Net weight 290 kg

No. of Packages/Pallets 1
Nature of Commodity
Volume CBM2

 Consolidation done by FM Logistics at CFS in Mumbai

 Cost, Insurance, and Freight (CIF) terms indicate the seller must deliver the
goods to a designated port and load them on a specified vessel, assuming
responsibility for paying all transportation, insurance, and loading costs. After
that, the buyer assumes the cost and risk associated with transporting the
cargo from the designated port to its warehouse or business.

2
 CBM Calculation Formula : Length (centimeter) x Width (centimeter) x Height (centimeter) / 1,000,000 = Length meter
x Width meter x Height meter = Cubic meter (m3)

54
 2.
Vendor Industrial Area Indore Indutrial Area Hatod
(Manufacturer of ¬Botanical Extracts, Essential
Oils, PG Extracts for Healthcare, Pharma & cosmetic
Industry.)
Port Of Loading Nhava-Sheva, Mumbai
Port Of Discharge Rotterdam, Netherlands
Inco Terms CIF
Cargo LCL
Commodity Herbal Products
Gross weight 1084 kg

Net weight 1000 kg

No. of Packages/Pallets 1
Nature of Commodity Phyto-sanitary Certificate
required
Volume CBM3

 Cost, Insurance, and Freight (CIF) terms indicate the seller must deliver the
goods to a designated port and load them on a specified vessel, assuming
responsibility for paying all transportation, insurance, and loading costs. After
that, the buyer assumes the cost and risk associated with transporting the
cargo from the designated port to its warehouse or business.

3
 CBM Calculation Formula : Length (centimeter) x Width (centimeter) x Height (centimeter) / 1,000,000 = Length meter
x Width meter x Height meter = Cubic meter (m3)

55
3.
Vendor Industrial Area Indore (Saanwer Road Indutrial
Area)
Port Of Loading Nhava-Sheva
Port Of Discharge Jebel ali, Dubai
Inco Terms Ex-Works
Cargo FCL
Commodity Machine Tools
Gross weight 10,000 KGs

Net weight 9,940 KGs

No. of Packages/Pallets 2
Nature of Commodity
Volume CBM4

4
 CBM Calculation Formula : Length (centimeter) x Width (centimeter) x Height (centimeter) / 1,000,000 = Length meter
x Width meter x Height meter = Cubic meter (m3)

56
 CHAPTER 5: Industrial Market
Research. (Indore Area) and Inland
Container Depot.
(Custom Office Jurisdiction)
Inland Container Depot (Dry Port) under
Jurisdiction Madhya Pradesh and Chhattisgarh
Custom

(Office of the Dy. / Assistant Commissioner,

Customs, Circle Indore Manik Bagh Palace,P.B.
No.10, Indore.).

1. ICD Pithampur, Distt-Dhar

2. ICD Dhannad, Distt- Indore
3. ICD Ratlam (Namleey), Distt-Ratlam
4. ICD Mandideep, Distt- Bhopal
5. ICD Pawer Kheda, Distt-Hoshangabad
6. ICD Malanpur, Distt- Gwalior
7. ICD Raipur, Raipur

57
58
59
 ICD Pithampur Visit

Sales
SOYA Products Food Products
Yarn/Polyster Wheat Flour
Machine and Machine Parts Coil and Wires
Other
0%

7% 10% 6%
49%
9%

19%

Import to ICD Pithampur, Dhar Distt. (in %age)

Metal Scraps (Copper/Iron) Pharmaceuticals
Machinery PP Graneuls
Other
8%
7%

9%

55%
21%

60
 Facts

 Commissioned 1994
 Warehouse space – 2, 000 sq. mtrs. (Bonded with 700 sqmm)

 Equipment – 2 Reach stacker, 90 Trailers, 2 Fork lifts, 1 Hydra & 1 Crane

 Detention Charges

Catchment Area
Central India including Nagda, Mandideep, Gwalior, Dewas, Ghatabilod, Indore, Pithampur
Indst. Area , Ujjain, Shajapur, Mangliagaon, Rau, Bhopal, Mandsaur, Biovra, Maxi&Ratlam,
Neemuch, Banswara, Dhamnod, Matahwara, Khargon

Main Services offered

1. Import and Export Logistics
2. Air Cargo Clearance
3. LCL cargo Consolidation for reworking at Mumbai.
4. Bonded warehouse.
5. Expansion plans for the terminal include extension of container yard.
6. E-filing facility

61
 ICD DHANNAD Visit

Export from ICD Dhannad, Distt. Indore (in

%age)
SOYA Products Polyster Food Products
Flour Machines Other

5% 11%

7% 46%

18%

13%

Import to ICD DHANNAD, Distt. Indore

Metal Scraps (Iron/Copper/Steel)
PP Graneuls
Pharmaceuticals
Machine and Machine Parts (Volvo Eicher and Other)
Other

13%
7%

9%
51%

20%

62
 BIBLIOGRAPHY
1. Under the guidance of
 Ravindra Rajwade sir – Director of AGL
 Osho Dongre - Sales Executive and Branch Coordinator

2. Induction manual of AGL

3. Websites
 http://agl.co.in/contact.php
 http://www.atc.co.in/
 https://jobs.mitula.in/premiumJobs/supply%20chain%20logistics%20management?ntwrk=ba&c
mpg=11_03_MT_IN_JO_BA_01_03
 https://en.wikipedia.org/wiki/Freight_forwarder

 Existing Status of Industrial Areas in the District Dewas. (n.d.). Retrieved

from DCMSME: http://dcmsme.gov.in/dips/2016-17/Dewas.pdf

 Custom Office Jurisdiction. (n.d.). Retrieved 2019, from

http://ccobz.gov.in/scan/PN012017-18.pdf

 Mishra, B. B. (2019, March). Blockchain and the Shipping Industry.

Retrieved from www.seanws.co.uk:
https://seanews.co.uk/features/blockchain-and-the-shipping-industry/

 MSME. (2019). Existing Status of Industrial Areas in the District Indore .

Retrieved from dvmsme: http://dcmsme.gov.in/dips/frorma%20-
%20dips%20-%20Indore.pdf

63