Exporters expect Budget will provide assistance to arrest slowing exports

The export data for past two-three months, which are showing low or marginal growth, is a matter of concern to all. an interim one, will unveil certain benefits, particularly for MSME sector, and for those specific product clusters and research & development, which will help in increasing exports, giving boost to manufacturing and job creation. 

Exporters have to still bear the taxes on petroleum and electricity, state levies such as Mandi Tax, etc. and the Budget will provide measures for refund of the same to exporters, hoped the FIEO President. He is of the view that promoting exports in the budget and giving it a much needed support at a time when global economy is facing slowdown, will come as a morale booster for the sector.

Employment creation is the biggest challenge in the country and therefore budget should provide tax concession to units which create jobs in the country. Every incremental creation of jobs should provide tax deduction equivalent to the employees cost to unit.

The Budget should allocate substantial fund for backward and forward linkages in agriculture including in cold chains and warehouses so that India  build on a stable Agri. Policy, announced earlier.
We are looking towards US$ 2 trillion of exports and imports by 2025. This requires huge marketing support through a planned “Export Development Fund” with a corpus of at least 0.5% of the export value so that exporters can be supported in their aggressive marketing.

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If You Must Use a Letter of Credit—Get It Right!

Too often exporters receive a letter of credit and then become frustrated with the terms the issuing bank has provided.

They ask, “Why would a bank issue a letter of credit with terms and conditions like this?” The issuing bank does not arbitrarily set the terms.

Setting the Terms of a Letter of Credit

Many exporters have learned that they can set the terms of the letter of credit. Several proactive techniques can accomplish this:

• Provide a detailed proforma invoice that gives sufficient information to the buyer for opening a letter of credit.
• Provide detailed instructions to the buyer for opening the letter of credit. At a minimum, a bullet-point list of criteria will go a long way.
• Ask buyers to fax a copy of the completed application for a letter of credit before they take it to their bank. This allows for feedback, revisions and agreement before the bank issues the letter of credit and will save time and money.
• If the buyer’s bank is willing, they may provide a draft of the SWIFT letter of credit prior to issuance.

Most buyers appreciate getting the information needed to issue a letter of credit. Of course following these recommendations is not fail-proof, but doing so increases the odds of receiving an acceptable letter of credit.

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Export Documentation Under GST

According to Section 16 of IGST:

(1) “zero rated supply” means any of the following supplies of goods or services or both, namely:–

(a) export of goods or services or both; or

(b) supply of goods or services or both to a Special Economic Zone developer or a Special Economic Zone unit.

(2) A registered person making zero rated supply shall be eligible to claim refund under either of the following options:-

a) he may supply goods or services or both under bond or Letter of Undertaking, without payment of integrated tax and claim refund of utilised input tax credit; or

(b) he may supply goods or services or both, on payment of integrated tax and claim refund of such tax paid on goods or services or both supplied.

Let’s understand above mentioned provisions:
Export can be made either:

• on production of LUT / Bond ,or

• with payment of GST,

• In case of IGST payment,

• the said payment can be claimed as Refund in the Return and

• payment means after adjustment of INPUT TAX CREDIT

In case of Non GST payment, Production of LUT / Bond is mandatory.

The following documents are commonly used in exporting:

Pro-forma Invoice

When a potential buyer’s send enquiry to an exporter, requesting to send information regarding price, quality, size, weight, grade, mode of delivery, payment terms, type of packing for export of goods. The exporter then sends a reply to the enquiry in the form of quotation known as pro-forma invoice.

Bill of lading

A bill of lading is a legal document between the shipper of a particular good and the carrier detailing the type, quantity and destination of the good being carried. The bill of lading also serves as a receipt of shipment when the good is delivered to the predetermined destination.

Commercial Invoice

The commercial invoice is a legal document between the supplier and the customer that clearly describes’ the sold goods, and the amount due on the customer. The commercial invoice is one of the main documents used by customs in determining customs duties.

Certificate of origin

The certificate of origin acts as a proof that goods have actually being manufactured in the country from where export is taking place. Having received the excise clearance, exporter may have to obtain a certificate of origin from the trade consulate located in the exporter country.

Inspection Certification

Different authorised institutions such as Tedfo, SGS, Intersect, Bureau Varitus provides all necessary quality assurance certificate to ensure that only good quality products are exported from a country.

Dock receipt & warehouse receipt

A dock receipt & warehouse receipt is issued by the warehouse supervisor or port officer certifying that goods have been received by the shipping company. Dock receipt are normally prepared by shippers or forwarders.

Destination control statement

The destination control statement is a legal statement that the goods you are exporting are destined to the country indicated in all the shipping documents.

Insurance certificate

After forwarding the goods the exporting firm gets goods insured with an insurance company to protect against the risks of loss or damage of goods due to the perils of sea during transit.

Export license(ERC)

Having become assured about payment, the exporter needs to apply for export license to the appropriate authority.

The following documents are needed for issuing ERC:

Attested photocopy of valid trade license, Attested photocopy of membership certificate from local chamber of commerce or trade association, Attested photocopy of TIN, Original copy of Treasury Chalan, If a partnership business, partnership deed (Certificate attested copy), If a limited company company, attested copy of certificate of incorporation, articles of association & memorandum of association are needed.Bank certificate.

Export packing list

A packing list is prepared by the shipper & sent to consignee for accurate tallying of the delivered goods which included in each shipping package, giving the quantity, description & weights of the contents.

WHO CAN OPT FOR LETTER OF UNDERTAKING (LUT) ?

LUT can be filed by an exporter who is :

• either a status holder, or

• has received convertible foreign exchange @ 10% of turnover or minimum of Rs. 1 crores in the preceding financial year

and has not contravened any provision of law which attracts evasion of tax of at least Rs. 2.5 crores.

Remember that non-contravention of any provision of law which attracts evasion of tax of at least Rs. 2.5 crores. is a mandatory condition in order to opt LUT.

If an assesses do not fulfil the above conditions, then he can file Bond along with Bank Guarantee.

Now comes the documentation required for facilitation of EXPORTS:

Circular No. 4/4/2017-GST says that every registered person exporting goods or services without payment of integrated tax is required to furnish a bond or a Letter of Undertaking (LUT) in FORM GST RFD-11.

Therefore, As per Department Instruction , For filing LUT, the following should be filed:

(i)  Request Letter on Letter Head,

(ii) GST RFD-11,

(iii) Letter of Undertaking on Letter Head,

(iv) Certificate of status holder or Bank Certificate mentioning the facts that the exporter has received the due foreign remittance amounting to 10% of turnover which would not be less than Rs. 1 crore

(v) Undertaking on Letter Head that the exporter had not been prosecuted for an offence where tax evaded exceeded Rs. 2.5 crores.

(vi) GST Registration Certificate   (vii) IEC Code   (viii) Copy of return filed under DVAT or Service tax for the preceding financial year

(ix) Exports Bill / invoices.

 After filing of these documents, on scrutiny, deficiency shall be informed and after proper satisfaction, Letter of Acceptance shall be issued and that shall be used for each export subsequently.

As per Department Instruction , For filing Bond, the following should be filed:

(i) Request Letter on Letter Head,

(ii) GST RFD-11,

(iii) Bond on Rs. 100/- Stamp Paper

(iv) GST Registration Certificate

(v) IEC Code

(vi) Copy of return filed under DVAT or Service tax for the preceding financial year

(vii) Exports Bill / invoices.

(viii) Bank Guarantee of 15% of tax involved

Bond and Bank Guarantee should be in favor of Commissioner, State Tax, Department of Trade & Taxes, Govt. of NCT of Delhi.

After filing of these documents, on scrutiny, deficiency shall be informed and after proper satisfaction, Bond shall be issued and that shall be used for the facilitation of that export.

Now, here are some common points for LUT and Bond:

• LUT / Bond would be filed by an exporter of an estimated tax liability which shall be valid for a particular financial year.

• LUT / Bond would be a running document with debit and credit amount as per billing and clearing system.

• If conditions of Exports are not fulfilled, then exporter would be liable for consequential Tax and interest and LUT / Bond would become in-operative and further be automatically active on payment of due tax and interest.

• LUT / Bond amount can be up-graded at any time at the option of the exporter.

• This LUT / Bond formalities has to be complied every year in the beginning for full financial year.

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SOFTWARE TO STREAMLINE YOUR EXPORT DOCUMENT PROCESS

The purpose of several common export documents and the information they typically include. This article expands on that discussion and explains how to use them in the export shipping documentation process.
Exports of physical goods that move between bodies of water can be expensive and risky if not done properly; therefore, in every scenario, the exporter must be aware of the export documents used to ship the goods. Understanding these common documents is crucial to your success abroad:
We provide tightly Integrating Export Business Processes with a Cloud Based Software  Solution. These solutions allow companies to automate and manage the complexity of their global trade, compliance and logistics processes.

Our market proven Export Documentation Software service enable export companies to rapidly integrate our technology, to enhance work place productivity and making it more cost effective, by streamlining day to day operations using our easy to use but efficient software.

OUR CORE VALUE

Complete Integrated Cloud Solution

Exim Doc offers a complete cloud based Export Management Software Suite. The products are modular in nature and can be used as standalone or as an integrate bundle to form a seamless end-to-end solution to streamline exporter’s documentation and regulatory approval need.

Experienced team

The substantial experience gained by the Exim Doc team from working in international trade across many varied industries is reflected in its products and services. Exim Doc offers a blend of software solutions and services around its products.

Wholly Indian

Exim Doc is a wholly owned Indian company and has been in business for over 15 years.  hOver the years itas provided solutions to a variety of clients in different industries and assisted them in streamlining their export processes and regulatory approvals.

LIST OF EXPORT DOCUMENTATION

• Export Invoice For Custom

• Packing List For Customs

• Annexure C1

• Tax Invoice

• Export Value Declaration(EVD)

• SDF form

• DBK declaration

• Export Sample Cover

• Separate Packing Details for Packing List

• Commercial Invoice

• Packing List for Consignee

• Bill of Exchange

• Bill Collection forwarding Letter

Automatically generate and download PDF documents with Export Documentation Software.

Coming Soon features in this month :-

 All Document Available in Excel Format Too.

 Grand Sales Report

 BRC - Post Shipment details

Effective Benefits To Use This Software To Generate All Export Documents :

• Generate Proforma invoice with all related information.
• During the export shipment just select Proforma invoice & auto generate all export documents.
• No need of accounting for making export documents.
• Get report by date-wise, by customer-wise & by product-wise.
• Download all export documents anytime, anywhere
• Easy & Fast export documents generated
• Your data to this software is totally secured with end to end encryption, which means software developer & third party can't cheat & read them. 

KEY FEATURES OF EXPORT DOCUMENTATION SOFTWARE

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PERSPECTIVE ON INTERNATIONAL TRADE

International trades between countries and across continents have existed for centuries including previous civilisations. Traditionally international trade consisted of traded goods like textile, food items, spices, precious metals, precious stones, and objects of art and various items across the borders. Everybody has heard of the silk route as well as amber road and other famous routes that existed and the ports and settlements that flourished due to the trade, which was carried on through land route as well as sea routes.

We have come a long way since the earlier times and International trade today has taken on new dimension. It was a fact earlier that impact of trade between two countries was not limited to economics alone, but fuelled political, social ambitions too. 

Today with the advancement of technology and impact of globalisation has made it necessary for all countries to engage necessarily in international trade for their survival.

Various factors including but not limited to industrialisation, development of transportation, globalisation, technology that enables trade and communication has contributed to change in the format of business organisations as well as trade practices.

Companies and Organisations today are no longer entities with a local identity. Multi national organisations have emerged through the previous century with footprints all over the globe. They have in fact shrunk the earth and changed the way businesses are conducted. Companies no longer limit themselves to local markets. They no longer depend upon local resources. These companies setup manufacturing wherever it is conducive in terms of cheaper resource availability as well as support from local government and in terms of markets, geographical boundaries do not bother them. They are present everywhere.

Technology in terms of communication as well as software technology has changed the way business organisations

manage activities be it manufacturing, procurement, finance or sales. Today software applications drive the processes and work at the speed of thought.

In present scenario, no country can afford to remain isolated from and not participate in globalisation. While countries do open their economies to global competition, they need to tread very carefully not to upset their domestic economy and protected industries. This balancing act is often managed through individual countries trade and tariff policy, which forms a part of each countries foreign trade policy that governs its approach to international trade and commerce.

Post Second World War, World Trade Organisations has been playing major role in facilitating and attempting to streamline the global trade and tariff structures with an aim to move towards free trade. However in reality, free trade may just be a dream as long as there is no parity between developed and developing economies.

Today most of the countries are party to several bi-lateral as well as multi lateral tariff and trade agreements like GATT — General Agreement on Tariffs and Trade though which they regulate imports and exports to and from specific countries.

In the last few decades we have seen the emergence of services export and imports and it is continually growing. Developing countries are harnessing their intellectual capital to provide software services to the developed countries.

Today’s international trade has many more new dimensions like intellectual property, a variety of services, trade related investments, Bilateral and Multilateral Trade Agreements, Establishing terms for trade in services, investments as well as creating climate for dispute settlement.

Managing International trade has multi dimensional aspects, which need to be considered, by each country. Any political, economic or other events anywhere in on the earth have an impact on each countries international trade. We have seen the impact of recession in one country affecting across the globe. We have also seen impact of financial markets crash in one country having ripple effects all over the world.

Any Business Manager holding responsibility of a business function in an organisation today would have to be equipped with the macro level understanding of the world trade, macroeconomics, macro finance and its impact. He needs to understand at the micro level export and import policies and procedures of various countries to be able to steer his business ahead in accordance with the existing environment. It is his ability to fore see the risks, assess the impact and manage the risk that is going to be detrimental to his organisation's success.

Main Largest Natural Sea Ports In India

PORTS IN INDIA

Indian  Ports are so important today for carrying out of trade. These clusters of hustle bustle along the sea are also something you should put on your itinerary next time you are out travelling for a pretty different experience and beautiful in their own unique way !

Kandla Port – The Busiest and The Richest !

The Kandla port is situated 90 kms from the Gulf of Kutch, Gujarat in a place called the Kandla creek. It was constructed in the 1950′s after the India Pakistan partition at the loss of Port of Karachi. It is the largest port in India according to how much of cargo is handled.Today, the Kandla port is one of the highest profit earning port of India and the centre for exporting grains and importing oil.

Visakhapatnam Port – By a beautiful creek !

Located in East of India in Andhra Pradesh between Chennai and Kolkata port. LordWillingdon inaugurated the Rs.378 lakh Visakhapatnam port on December 19,1933.

This port handles around 1.2 lakh tonnes of cargo every year.The Visakhapatnam port has three main harbours: the outer harbour, the inner harbour and the fishing harbour.The port is located on a creek where the Narava Gedda joins the sea, a beautiful sight. The port is said to become more defined and modernised by 2016-2017 after an investment of Rs.13 crore.

Chennai Port – Second Largest !

The Chennai port also known as the Madras port is the second largest port in the whole fo India. It is the third oldest port in India that started its operations in 1881. It lies on the Coromandel coast in the Bay of Bengal.

The cargo handling of the Chennai port increased from 0.5 million in 1979-78 to 100 million in 2015-16, you can only imagine its drastic evolution and how necessary it is for the boom of Tamil Nadu. The port is surrounded by both historic and modern lighthouses giving it a beautifying look.

Jawaharlal Nehru Port – Port of the year !

The Nhava Sheva which is another name for the Jawaharlal Nehru Port is the largest container port in the whole of India. It is situated in the east of Mumbai, Maharashtra. The name Nhava Sheva is derived from the names of two villages that used to exist in that area.

Constructed on May 26, 1989, the Jawaharlal Nehru port is completely controlled by the Indian Government. This port handles 56% of the total containers and is one of the top 30 ports in India. The chairman of the Jawaharlal Nehru port is Shri Anil Diggikar.

The Jawaharlal Nehru port was awarded the “Port of the year” at the MALA awards, 2014.

Mormugao Port – Goa just keeps getting better !

Goa is a beautiful place and the main tourist attraction in India and hence the need for a port to make Goa flourish more through its trading affairs.

The chairman of the Mormugao port is Shri I.Jayakumar.

Mormugao port is a port located in Goa and is the main port of Goa and is plays an important role in its trade affairs. It was awarded the status of a major port in 1963 and are the leading iron ore exporters of India exporting a total of 50.02 million tonnes of iron ore every year.

Port Blair Port – Youngest Port !

Port Blair is situated in the Andamans and Nicobar island and is one of the major ports of India. The government declared this port as a major due to its contribution in boosting the ports of India to 13th place.

The Port Blair port is the youngest sea port in India and is connected to the mainland of India through ship and flight. 

Mumbai Port – Largest Port of India !

Located on the mainland of West mumbai is the Mumbai port. It is the largest port in India. It is a natural harbour and is 10-12 metre deep. It handles around one-fifth of India’s foreign trade.

The Mumbai port is one of the busiest port in India. It plays a very important role in enhancing India’s economy and trade affairs. The Mumbai harbour is also known as “Front Bay”, meaning gateway of India.

The port mainly specializes in import of petroleum products, liquid chemicals and mineral oil and imports consist of cotton textiles, leather, tobacco, manganese, machinery, chemical goods.

Kolkata Port – The oldest one by East India Company !

The Kolkata port is situated 128 kms from Bay of Bengal on the bank of the river Hugli. This port handles all the goods coming mainly from Australia, South- East Asian countries. It is also known as the ‘Gateway of Eastern India. The Kolkata port is the only port having two dock systems called Kolkata docks and Haldia docks.

It is one of the largest dry docks of India and also the oldest port that was made by the East India company. The Kolkata port is the most important centre in the trade of jute.

It exports Jute products, tea,coal, steel, iron ore, copper, leather etc and imports are mainly that of machinery, crude oil, paper, fertilizers and chemical products.

Paradip Port –  It has its own railway !

The Paradip port is a deep water port that is situated on the coast of Orissa. The depth of the port allows it to handle heavy and bulk containers. This port mainly deals with iron-ore and coal. Iron-ore is exported to Japan in huge quantities.

This port’s exports are always double the amount of its imports. In 2003, the Paradip port’s imports were only 6,991 thousand tonnes while its exports reached a total of 16,910 thousand tonnes.
This port even has its own railway system to make transport easy. Recently an oil jetty that can handle up to 8 million tonnes of petroleum products and tankers of 85,000 DWT was constructed making the Paradip port even more efficient and better.

Tuticorin Port – Go for the sea, stay for the pearls ?

Tuticorin port is a new port that was recently constructed in Tamil Nadu. It is an artificial harbour developed 8kms south of the old Tuticorin port.

 The port mainly trades with Sri Lanka and is properly connected by railways and roads. It is also the second largest port in Tamil Nadu. It is best for pearl fishery in the Bay of Bengal and is also known as the pearl city.

It mainly deals with trade of coal, salt, food grains, edible oil, sugar, and petroleum products.

Cochin Port–It lies between two islands !

The major port on the Arabian Sea, the Cochin port is one of the largest port in India and also the fastest growing one situated in Kerala. The Cochin port lies in between two islands namely Willingdon and Vallarpadam.

Its export mainly consists of tea,coffee and spices while its exports consists of mineral oil and chemical fertilisers. It is also a centre for shipbuilding. In this port the imports always exceeds the exports.