“EXPORT – IMPORT PROCEDURES IN BALA EXPORTS”

An internship report submitted in partial fulfilment of the requirements for

the award of the degree of

MASTER OF BUSINESS ADMINISTRATION

IN INTERNATIONAL BUSINESS
By
L.HIMAJA
Reg.No:22382041

Under the guidance of

Dr. M. BANUMATHI
Professor,
Pondicherry University.

Department of International Business

School of Management
Pondicherry University
Puducherry, India- 605014
June2022 - May2024
 DEPARTMENT OF INTERNATIONAL BUSINESS
SCHOOL OF MANAGEMENT
PONDICHERRY UNIVERSITY

CERTIFICATE

This is to certify that the internship report entitled “EXPORT – IMPORT PROCEDURES
IN BALA EXPORTS” is submitted by L.HIMAJA, (Reg.No: 22382041) in partial
fulfilment of requirements for the award of the degree of Master of Business Administration
in International Business by Pondicherry University.

DR.P.G.ARUL DR.M.BANUMATHI
Professor and Head, Professor,
Department of International Business Department of International Business
School of Management School of Management
Pondicherry University. Pondicherry University.
 DECLARATION

I, Ms. L.HIMAJA, hereby declare that the internship report titled “EXPORT – IMPORT
PROCEDURES IN BALA EXPORTS” is the original work done by me and submitted to
the Pondicherry University in partial fulfilment of requirements for the award of Master of
Business Administration in International Business, is a record of original work done by
me under the supervision of Dr M. BANUMATHI, Professor, Department of International
Business, Pondicherry Central University, Puducherry.

Place: Puducherry

Date: L.HIMAJA
 ACKNOWLEDGEMENT

I express my sincere gratitude to the people who guided me, helped and trained and
motivated me in the completion of the project report.

Firstly I express my sincere thanks to Dr. P.G.Arul,, Head of the Department of International
Business, who encouraged me throughout the project completion.

I was only able to complete this project with the full guidance of Dr M.BANUMATHI,
Professor, Department of International Business. And Mr. R. BALABASCARANE,
Proprietor of BALA EXPORTS, Pondicherry. I thank them for their continuous support and
for spending their valuable time for the successful completion of this project.

I also convey my thanks to all other faculty members of the Department of International
Business for their valuable suggestions. I would like to extend my heartfelt gratitude to the
company BALA EXPORTS, Pondicherry and employees for being supportive throughout the
process and for their valuable information regarding collecting the data and giving insights of
Import – Export Procedures. I would also like to thank them for their patience and
cooperative nature in successful completion of this report.

Finally, I would like to thank my friends, my relatives for extending their help and
involvement in this project.
 TABLE OF CONTENTS
CHAPTER TITLE PAGE NO

1 INTRODUCTION 1 - 23

2 COMPANY PROFILE 24 – 28

3 EXPORT – IMPORT PROCEDURES IN BALA 29 - 33

EXPORTS

4 CONCLUSION 34 - 35

REFERENCES

APPENDIX
 CHAPTER – 1
INTRODUCTION

1
 CHAPTER – 1
INTRODUCTION

INTRODUCTION
Export documentation is a very important area in export management. Exporters are required
to follow certain formalities and procedures, using a number of documents. Each of these
documents serves a specific purpose and hence carries its own unique significance. A clear
understanding of all documents and their purpose, how to prepare these, number of copies
required, when and where to file, is a must for all export professionals. Usually, one could
counter this by saying that experts’ help is available to do this job, so why should one bother.
Sounds convenient too; you may not prepare or file these documents by yourself, but then
you will surely be able to crosscheck these for accuracy and correctness of information before
allowing someone else to file these on your behalf. After all if anything goes wrong, whether
you are an employee or an export businessman, it will be your neck on the noose!

An export manager needs to keep himself thoroughly updated on all documentation

requirements to carry out an export transaction successfully and it is one of his primary
responsibilities to ensure that all documentary formalities are duly complied with. Export
transactions are comparatively more complex than domestic business transactions. These
require a lot of paperwork and almost nothing is done verbally, while in domestic business, at
times, one could do with certain verbal communications. For example, a lot of orders for
domestic business are placed and received verbally. This is not possible in international
business. Documentation in export business assumes greater significance as many
parties/authorities are involved in a single transaction. There are the buyers and exporters,
buying agents, RBI, authorized dealers in India (where the exporter has his bank account),
buyer’s bank (foreign bank), DGFT, customs and port authorities, VAT and excise authorities,
EPCs, insurance companies, inspection agencies, clearing and forwarding agents, shipping
companies/airlines and inland haulage carriers, etc. This is just an indicative list! Proper
documentation will ensure smooth sailing with the requirements of each of these agencies
and the resulting transaction will be a successful one. Inaccurate or incomplete
documentation will result in serious financial and goodwill losses. Such losses can be
completely avoided by understanding clearly the documentation requirements of all
concerned parties and then meticulously planning to get the right documents in the right
numbers, at the right places and at the right time.

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Exporting from India:
India’s Foreign Trade i.e., Exports and Imports are regulated by Foreign Trade Policy notified
by Central Government in exercise of powers conferred by section 5 of Foreign Trade
(Development and Regulation) Act 1992. Presently Foreign Trade Policy 2023 – 2028 is
effective.
 Starting Exports
Export in itself is a very wide concept and a lot of preparations is required by an
exporter before starting an export business. To start export business, the following
steps may be followed:
 Establishing an Organisation
 Opening a Bank Account
 Obtaining Permanent Account Number
 Obtaining Importer Exporter Code (IEC)
 Registration Cum Membership Certificate (RCMC)
 Selection of Product
 Selection of Market
 Finding Buyers
 Sampling
 Pricing/Costing
 Negotiation with Buyers
 Covering Risks through ECGC
 Processing an Export Order
 Confirmation of Order
 Procurement of Goods
 Quality Control
 Finance
 Labelling, Packaging, Packing and Making
 Insurance
 Delivery
 Customs Procedures
 Documentation
 Submission of documents to Bank and Realization of Exports Proceeds.

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FOREIGN TRADE POLICY 2023

Union Minister of Commerce and Industry, Consumer Affairs, Food and Public Distribution
and Textiles, Shri Piyush Goyal today launched the Foreign Trade Policy 2023 saying that it
is dynamic and has been kept open ended to accommodate the emerging needs of the time.
He stated that the policy had been under discussion for a long time and has been formulated
after multiple stakeholder consultations. India's overall exports, including services and
merchandise exports, has already crossed US$ 750 Billion and is expected to cross US$ 760
Billion this year, he said. He stressed that every opportunity for export must be captured and
utilised effectively. He also mentioned that in the next 5 months during India’s G20
presidency there should be a massive concentrated outreach with the world both sector-wise
and country-wise.

The Key Approach to the policy is based on these 4 pillars:

(i) Incentive to Remission,

(ii) Export promotion through collaboration - Exporters, States, Districts, Indian
Missions,
(iii) Ease of doing business, reduction in transaction cost and e-initiatives and
(iv) Emerging Areas – E-Commerce Developing Districts as Export Hubs and
streamlining SCOMET policy.

Foreign Trade Policy (2023) is a policy document which is based on continuity of time-tested
schemes facilitating exports as well as a document which is nimble and responsive to the
requirements of trade. It is based on principles of ‘trust’ and ‘partnership’ with exporters. In
the FTP 2015-20, changes were done subsequent to the initial release even without
announcement of a new FTP responding dynamically to the emerging situations. Here after,
the revisions of the FTP shall be done as and when required. Incorporating feedback from
Trade and Industry would also be continuous to streamline processes and update FTP, from
time to time.

The FTP 2023 aims at process re-engineering and automation to facilitate ease of doing
business for exporters. It also focuses on emerging areas like dual use high end technology
items under SCOMET, facilitating e-commerce export, collaborating with States and Districts
for export promotion.

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The new FTP is introducing a one-time Amnesty Scheme for exporters to close the old
pending authorizations and start afresh.

The FTP 2023 encourages recognition of new towns through “Towns of Export Excellence
Scheme” and exporters through “Status Holder Scheme”. The FTP 2023 is facilitating exports
by streamlining the popular Advance Authorization and EPCG schemes, and enabling
merchanting trade from India.

Towns of Export Excellence

Four new towns, namely Faridabad, Mirzapur, Moradabad, and Varanasi, have been
designated as Towns of Export Excellence (TEE) in addition to the existing 39 towns. The
TEEs will have priority access to export promotion funds under the MAI scheme and will be
able to avail Common Service Provider (CSP) benefits for export fulfillment under the EPCG
Scheme. This addition is expected to boost the exports of handlooms, handicrafts, and
carpets.

Recognition of Exporters

Exporter firms recognized with 'status' based on export performance will now be partners in
capacity-building initiatives on a best-endeavor basis. Similar to the 'each one teach one'
initiative, 2-star and above status holders would be encouraged to provide trade-related
training based on a model curriculum to interested individuals. This will help India build a
skilled manpower pool capable of servicing a $5 Trillion economy before 2030. Status
recognition norms have been re-calibrated to enable more exporting firms to achieve 4 and 5-
star ratings, leading to better branding opportunities in export markets.

Promoting export from the districts

The FTP aims at building partnerships with State governments and taking forward the
Districts as Export Hubs (DEH) initiative to promote exports at the district level and
accelerate the development of grassroots trade ecosystem. Efforts to identify export worthy
products & services and resolve concerns at the district level will be madethrough an
institutional mechanism – State Export Promotion Committee and District Export Promotion
Committee at the State and District level, respectively.District specific export action plans to
be prepared for each district outlining the district specific strategy to promote export of
identified products and services.

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Streamlining SCOMET Policy

India is placing more emphasis on the "export control" regime as its integration with export
control regime countries strengthens. There is a wider outreach and understanding of
SCOMET (Special Chemicals, Organisms, Materials, Equipment and Technologies) among
stakeholders, and the policy regime is being made more robust to implement international
treaties and agreements entered into by India.A robust export control system in India would
provide access of dual-use High end goods and technologies to Indian exporters while
facilitating exports of controlled items/technologies under SCOMET from India.

Facilitating E-Commerce Exports

E-commerce exports are a promising category that requires distinct policy interventions from
traditional offline trade. Various estimates suggest e-commerce export potential in the range
of $200 to $300 billion by 2030. FTP 2023 outlines the intent and roadmap for establishing e-
commerce hubs and related elements such as payment reconciliation, book-keeping, returns
policy, and export entitlements. As a starting point, the consignment wise cap on E-
Commerce exports through courier has been raised from ₹5Lakh to ₹10 Lakh in the FTP
2023. Depending on the feedback of exporters, this cap will be further revised or eventually
removed. Integration of Courier and Postal exports with ICEGATE will enable exporters to
claim benefits under FTP. The comprehensive e-commerce policy addressing the
export/import ecosystem would be elaborated soon, based on the recommendations of the
working committee on e-commerce exports and inter-ministerial deliberations. Extensive
outreach and training activities will be taken up to build capacity of artisans, weavers,
garment manufacturers, gems and jewellery designers to onboard them on E-Commerce
platforms and facilitate higher exports.

Facilitation under Export Promotion of Capital Goods (EPCG) Scheme

The EPCG Scheme, which allows import of capital goods at zero Customs duty for export
production, is being further rationalized. Some key changes being added are:

 Prime Minister Mega Integrated Textile Region and Apparel Parks (PM MITRA)
scheme has been added as an additional scheme eligible to claim benefits under
CSP(Common Service Provider) Scheme of Export Promotion capital Goods
Scheme(EPCG).

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  Dairy sector to be exempted from maintaining Average Export Obligation – to support
dairy sector to upgrade the technology.

 Battery Electric Vehicles (BEV) of all types, Vertical Farming equipment, Wastewater
Treatment and Recycling, Rainwater harvesting system and Rainwater Filters, and
Green Hydrogen are added to Green Technology products – will now be eligible for
reduced Export Obligation requirement under EPCG Scheme

Facilitation under Advance authorization Scheme

Advance authorisation Scheme accessed by DTA units provides duty-free import of raw
materials for manufacturing export items and is placed at a similar footing to EOU and SEZ
Scheme. However, the DTA unit has the flexibility to work both for domestic as well as
export production. Based on interactions with industry and Export Promotion councils,
certain facilitation provisions have been added in the present FTP such as

 Special Advance Authorisation Scheme extended to export of Apparel and Clothing

sector under para 4.07 of HBP on self-declaration basis to facilitate prompt execution
of export orders – Norms would be fixed within fixed timeframe.

 Benefits of Self-Ratification Scheme for fixation of Input-Output Norms extended to

2 star and above status holders in addition to Authorised Economic Operators at
present.

Merchanting trade

To develop India into a merchanting trade hub, the FTP 2023 has introduced provisions for
merchanting trade. Merchanting trade of restricted and prohibited items under export policy
would now be possible. Merchanting trade involves shipment of goods from one foreign
country to another foreign country without touching Indian ports, involving an Indian
intermediary. This will be subject to compliance with RBI guidelines, andwon’t be applicable
for goods/items classified in the CITES and SCOMET list. In course of time, this will allow
Indian entrepreneurs to convert certain places like GIFT city etc. into major merchanting
hubs as seen in places like Dubai, Singapore and Hong Kong.

Amnesty Scheme

Finally, the government is strongly committed to reducing litigation and fostering trust-based
relationships to help alleviate the issues faced by exporters. In line with "Vivaad se Vishwaas"

7
initiative, which sought to settle tax disputes amicably, the governmentis introducing a
special one-time Amnesty Scheme under the FTP 2023to address default on Export
Obligations. This scheme is intended to provide relief to exporters who have been unable to
meet their obligations under EPCG and Advance Authorizations, and who are burdened by
high duty and interest costs associated with pending cases.All pending cases of the default in
meeting Export Obligation (EO) of authorizations mentioned can be regularized on payment
of all customs duties that were exempted in proportion to unfulfilled Export Obligation.The
interest payable is capped at 100% of these exempted duties under this scheme. However, no
interest is payable on the portion of Additional Customs Duty and Special Additional
Customs Duty and this is likely to provide relief to exporters as interest burden will come
down substantially.It is hoped that this amnesty will give these exporters a fresh start and an
opportunity to come into compliance

IMPORT PROCEDURES

Typically, the procedure for import and export activities involves ensuring licensing and
compliance before the shipping of goods, arranging for transport and warehousing after the
unloading of goods, and getting customs clearance as well as paying taxes before the release
of goods. Below, we outline the steps involved in importing of goods.

1. Obtain IEC: Prior to importing from India, every business must first obtain an Import
Export Code (IEC) number from the regional joint DGFT. The IEC is a pan-based
registration of traders with lifetime validity and is required for clearing customs,
sending shipments, as well as for sending or receiving money in foreign currency.
2. Ensure legal compliance under different trade laws Once an IEC is allotted,
businesses may import goods that are compliant with Section 11 of the Customs Act
(1962), Foreign Trade (Development & Regulation) Act (1992), and the Foreign
Trade Policy, 2015-20. However, certain items – restricted, canalized, or prohibited,
as declared and notified by the government – require additional permission and
licenses from the DGFT and the federal government.
3. Procure import licenses To determine whether a license is needed to import a
particular commercial product or service, an importer must first classify the item by
identifying its Indian Trading Clarification based on a Harmonized System of Coding
or ITC (HS) classification. An import license may be either a general license or
specific license. Under a general license, goods can be imported from any country,

8
 whereas a specific or individual license authorizes import only from specific
countries. Import licenses are used in import clearance, renewable, and typically valid
for 24 months for capital goods or 18 months for raw materials components,
consumables, and spare parts.
4. File Bill of Entry and other documents to complete customs clearing formalities After
obtaining import licenses, importers are required to furnish import declaration in the
prescribed Bill of Entry along with permanent account number (PAN) based Business
Identification Number (BIN), as per Section 46 of the Customs Act (1962). A Bill of
Entry gives information on the exact nature, precise quantity, and value of goods that
have landed or entered inwards in the country. If the goods are cleared through the
Electronic Data Interchange (EDI) system, no formal Bill of Entry is filed as it is
generated in the computer system. However, the importer must file a cargo declaration
after prescribing particulars required for processing of the entry for customs
clearance.
5. Determine import duty rate for clearance of goods India levies basic customs duty on
imported goods, as specified in the first schedule of the Customs tariff Act, 1975,
along with goods-specific duties such as anti-dumping duty, safeguard duty, and
social welfare surcharge. In addition to these, the government levies an integrated
goods and services tax (IGST) under the new GST system. The IGST rates depend on
the classification of imported goods as specified in Schedules notified under Section 5
of the IGST Act (2017).

IMPORT DOCUMENTATION:

1.Bill of Entry.

2.Commercial invoice.

3.Packing List.

4.Bill of Lading.

5.Foreign Exchange Control Form (Form A-1)

6.Terminal Handling Receipt.

7.Certified Engineer's Report.

8.Cargo Release Order

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EXPORT DOCUMENTATION REQUIRED IN INDIA

Export documentation in India has evolved a great deal particularly since 1990. Efforts are
on, on a faster footing to streamline and modernize the system further. Prior to 1990, the
documentation was all manual and not at all coordinated. The result was lot of delays and
mistakes, rendering the task very clumsy, tiresome, repetitive and truly frustrating. India
adopted the ADS in 1991. ADS refers to Aligned Documentation System, which is the
internationally accepted documentation system. ADS uses a Master Document that contains
the information common to all documents forming part of the aligned series.

The export documentation framework in India can be best understood by classifying export

documents in the following two categories:

1. Commercial documents

2. Regulatory documents.

For the purpose of clear understanding, these are discussed under the following broad heads

 Commercial Documents: These documents have their origin in “Custom of Trade”

in international commerce and are used by exporters/importers to discharge their
respective legal and other incidental responsibilities under sales contract. Commercial
documents can be further sub-divided into: (a) Principal commercial documents and
(b) Auxiliary commercial documents.
 Regulatory Documents: These are prescribed by various government
departments/bodies for compliance of formalities under relevant laws governing
export transactions. These include: Exchange Control Declaration Form-GR Form,
Freight Payment Certificate, Insurance Premium Payment Certificate, ARE I/ARE II
Forms Shipping Bill/Bill of Export, Port Trust Copy of Shipping Bill/Export
Application/Dock Challan, Receipt of Payment of Port Charges, Vehicle Ticket.

A detailed description of all the Commercial and Regulatory documents is given below:

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 EXPORT DOCUMENTS

COMMERCIAL DOCUMENTS REGULATORY DOCUMENTS

PRINCIPAL COMMERCIAL

 Commercial Invoice
 Packaging List
 Certificate of Inspection
 Bill of Lading  Exchange Contract
 Air Way Bill Declaration Form
 Certificate of origin  GR Form
 Bill of Exchange  Freight Payment
 Shipment Advice Certificate
 Insurance Payment
 ARE I/ ARE II
 Shipping Bill
 Bill of Export
 Port Trust Copy
 Export Application/Dock
Challan
 Receipt of Payment of
Port Charges
AUXILARY COMMERCIAL

 Vehicle Ticket
 Proforma Invoice
 Shipping Instruction
 Insurance Declaration
 Intimation for Inspection
 Shipping Order
 Application for Certificate of
Origin

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Commercial Invoice: It is the basic and most important document in an export transaction
and extreme care has to be taken by the exporter to prepare this document. A commercial
invoice must provide complete and accurate information as is expected. A slight mistake on
the part of the exporter may cost him dearly. This document requires the exporter to submit
details such as his own (exporter) details, invoice number with date, details of the consignee
and buyer (if the buyer is other than the consignee), buyer’s order number with date, country
of origin of the goods, country of final destination, terms of payment and delivery, pre-
carriage details (road/ rail), place of receipt by pre-carrier, vessel/flight number, port of
loading, port of discharge, final destination, marks and numbers, container number, number
and kind of packaging, detailed description of goods, quantity, rate and total amount
chargeable.

 Exporter: This box appears on the top left hand corner of the commercial invoice.
Here, the exporter is required to give his name and complete address specifying the
city, state and country along with his phone and fax numbers. The purpose is to
establish the identity of the shipper.
 Consignee: This box requires details, that is, the name and complete address of the
party to whom the goods are being consigned.
 Buyer: Usually, the buyer and the consignee are the same. However, in cases where
the buyer is different from the consignee, his details, that is, the buyer’s name and
complete address is to be provided in this box.
 References and Numbers with date: In these boxes the relevant references such as
exporter’s quotation number with date, invoice number with date, buyer’s order
number with date have to be accurately filled in.
 Country of Origin of Goods: The exporter has to fill this box with the name of the
country where the goods have actually been produced.
 Country of Final Destination: This box must provide the name of the country where
the goods will be finally delivered.
 Terms of Delivery and Payment: This box has to contain details of the terms of
delivery like FOB, C&F, CIF, etc. and the terms of payment such as L/C (letter of
credit), D/A (documents against acceptance), D/P (documents against payment), etc.
These terms have been discussed in details in chapters titled “Terms of Payment” and
“Methods of Payment” respectively.

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  Pre-carriage By: This box should provide the name of the carrier/mode of transport
used to bring the goods from the place of origin to the place where these were
accepted by the pre-carrier.
 Place of Receipt by Pre-carrier: This box has to depict the name of the place where
goods were accepted by the pre-carrier.
 Vessel/Flight Number: This box requires the name and number details of the
shipping vessel or the aircraft carrier being used for the shipment.
 Port of Loading: The name of the port where goods are loaded on board ship or
flight is required to be provided in this box.
 Port of Discharge: The name of the port where goods are finally off-loaded (airport
or seaport) is to be filled in this section.
 Final Destination: This box must contain the name of the place that is the final
destination of the shipment. This will mean not the port of discharge but the final
destination from the port of discharge in the buyer’s country.
 Mark Numbers and Container Number: This box shows the various marks and
numbers that are required to be put on the packed cargo. If containers are being used,
then the container numbers are also required.
 Number and Kind of Packages: Here, the type of packages being shipped such as
cartons, bales, bags, drums, crates, etc. and the total number of such packages being
shipped are to be provided.
 Description of Goods: The detailed description of goods being shipped is to be put in
this section. The description has to be the same as required in the export order/letter of
credit. If more than one types of goods are being sent, the description of each is
required to be given against the respective number and kind of packages.
 Quantity, Rate and Amount: These columns must show the quantity and respective
rates of each item being exported and the total amount chargeable, both in figures and
words. The quantities and rates have to be the same as in the export contract.
 Signature with Date: The invoice must in the end, have the signatures with date of
the exporter or his authorized representative. Unless this is done, the invoice will
remain incomplete and therefore ineffective.

Bill of Lading: This is issued when goods are shipped using ocean (marine) transport, i.e.
ships. When the exporter finally hands over the goods to the shipping company for loading on
board the ship for transport to their foreign destination, the shipping company issues a set of

13
Bills of Lading to the exporter. This set serves multiple purposes. It is a receipt signifying
physical acceptance of cargo by the shipping company and also a contract of carriage
between the exporter and the shipping company for transport of the goods to their designated
destination. In addition, the bill of lading also works as a document of title to the goods. The
importer gets the right to take possession of the merchandise in his own country only if he
possesses the bill of lading. This document is the instrument used for passing the ownership
right or title of the goods to the buyer by the exporter.

Airway Bill: Airway bill is a bill of lading used when the goods are shipped using air
transport. It is also known as an air consignment note or airway bill of lading. It is similar to
the ocean bill of lading on two counts. One, it too serves as a receipt of goods by the carrier
and two, it also works as a contract of carriage between the shipper and the carrier. However,
unlike a marine bill of lading it does not serve as a document of title to the goods. Hence, it is
a non-negotiable document. The goods will be delivered to the party named as consignee in
the AWB without need of any further formalities, once the importer obtains customs
clearance. Therefore, an exporter is advised to ensure the payment receipt, as it is quite risky
to consign goods through air direct to the importer.

Certificate of Origin: This document serves as a proof of the country of origin of goods for
the importer in his country. Importing countries usually require this to be produced at the time
of customs clearance of import cargo. It also plays an important part in computing the
liability and rate of import duty in the country of import. This certificate declares the details
of goods to be shipped and the country where these goods are grown, manufactured or
produced. Such goods need to have substantial value-addition in the country of export so as
to become eligible to certification of this nature. Certificate of origin also has the dimension
of preferential duty treatment.

Shipping Order: This document is the reservation slip issued by the shipping company
against the exporter’s or his agent’s request for booking of ship space for a shipment. In case
of air transport of cargo, this document is known as Carting Order.

Mate’s Receipt: Once the goods are received on board the ship, the master of the ship issues
a document called mate’s receipt to the port authorities for every shipment. The exporter must
then collect this receipt either himself or through his authorized agent from the port
authorities by paying all charges due to them. The shipping company issues the bill of lading
to the exporter only against the mate’s receipt. This document is not a document of title. It is

14
merely a receipt of goods. However, it is a very important document as without it, the
exporter will not be able to obtain the title document to the goods, that is, the bill of lading.
Therefore, the exporter is best advised to obtain the mate’s receipt from the port authorities
soon after the goods have been placed on board. Any delay here may further result in greater
delays leading to unwanted losses.

Bill of Exchange: Also known as a Draft, this is an instrument for payment realization. By
definition, it is a written unconditional order for payment from a drawer to a drawee,
directing the drawee to pay a specified amount of money in a given currency to the drawer or
a named payee at a fixed or determinable future date.

Shipment Advice: The exporter sends this document, called shipment advice, to the buyer
soon after the shipment is made to provide him all the shipment details. This serves as
advance intimation of the shipment and allows the importer to arrange for the delivery of the
same.

Exchange Control Declaration Forms: As per the Foreign Exchange Management (Export
of Goods and Services) Act, 2000, all exporters from India excepting those exporting to
Nepal and Bhutan, are required to submit an exchange control declaration form in the
prescribed format. The purpose behind this declaration is to ensure timely realization of
export proceeds by the exporters and to track the defaulters. FEMA requires the submission
of export documents to the Authorised Dealer by the exporter within 21 days from the date of
shipment. The time allowed for full export value realisation is six months from the date of
shipment.

Freight Payment Certificate: This certificate is an evidence of freight payment. It certifies

that due freight has been paid by the exporter. It is an equivalent of freight receipt.

Insurance Premium Payment Certificate: This document certifies the payment of

insurance premium.

ARE I/ARE II Forms: These are forms pertaining to Central Excise Clearance. These need
to be used only by those exporters who are governed by Central Excise.

Shipping Bill/Bill of Export: This happens to be the most important document required by
customs authorities for permitting exports. It is called a shipping bill in case of export by
sea/air and a bill of export when the export is done using land transport. The goods are
allowed to enter the port only after the custom officials have stamped the shipping bill. It

15
contains complete details of the shipment including name of exporter, name of importer,
description of goods, port of loading, port of discharge, marks, number, quantity, FOB value,
country of destination, name of the vessel or flight number, etc.

Port Trust Copy of Shipping Bill/Export Application/Dock Challan: This form is the
same as shipping bill. However, the purpose here is to assess the various port and dock
charges. This is used in sea shipments.

Receipt of Payment of Port Charges: This is the receipt issued by the Port Trust Authority
on payment of port dues by the exporter.

Vehicle Ticket: It serves the purpose of an entry pass for the exporter to get his export cargo
inside the port for export to its final destination.

Intimation for Inspection: This is the prescribed format for intimating the Export Inspection
Agency (EIA) inviting them to come to inspect the shipment.

Certificate of Inspection: This is the certificate issued by the EIA after it has conducted the
pre- Notes shipment inspection of goods for export provided the goods fall under the notified
category of goods requiring compulsory pre-shipment inspection.

Certificate of Insurance/Insurance Policy: Insurance is an important area in the export

business as the stakes are usually very high. Protection needs to be taken in the form of
insurance cover for the duration of transit of goods from the exporter to the importer.

OTHER IMPORTANT ASPECTS OF EXPORTING:

 Item (product): The exporter has to check whether he has received the order for the
same product for which he has sent per forma invoice/quotations, etc. as the same
exporter may have sent two or three quotations for other purchase orders to the same
importer. It is advisable to check the quotation number with the export order.
 Sizes and Specifications: The exporter shall check that size and specifications are
same as quoted. A minor difference may create havoc.
 Pre-shipment Inspection: The Government of India, through its Export Quality
Control Act 1963, has made it mandatory to get goods inspected before shipments.
Now it is to be seen that inspection is to be done by the buyer-nominated agency or
exporter’s agency. If it is by the importer’s nominated agency, it is advisable to get
that agency named in the export order itself. Otherwise, there may be problem to the

16
 exporter later on, as the buyer’s chosen agency may be located at a distant place and it
can have financial implications to the exporter.
 Terms of Payments: The exporter has to check whether the terms of payments are the
same as mentioned in the quotation he has given. Advance payments are considered to
be the safest mode of payments but no importer is willing to make payments in
advance in this globally competitive era. A letter of credit is another preferred method
of payment, but the exporter needs to check its authenticity and transactional cost
involved. Documents against Payments and Documents against Acceptance are other
method of payments, which are widely used in international trade. The buyer has to be
careful in choosing his payments terms keeping in mind the creditworthiness of the
importer. Open Account Payments are not advisable as the jurisdictions of countries
vary and there are no international conventions protecting exporters through
arbitration for obtaining payments under the Open Accounts Method. Some of the
important issues to be looked at by exporters are:
(a) Letter of credit, which is opened by the importer bank, shall be confirmed by the
Indian bank. Exporters shall also check the creditworthiness of the bank through
world banks almanac.
(b) The exporter can submit the documents as required in the letter of credit at the
time of negotiating these documents with the bank for receiving payments.
(c) Payments under Drafts (bill of exchange) drawn are to be ‘sight’ or ‘usance’ and
to be drawn on the bank of importer or the buyer himself.
(d) The exporter has to see whether the credit validity period is sufficient for the
collection of all relevant documents or not. If not, it is advisable to get it extended by
the buyer in the beginning itself.
(e) What is the exchange control regulation of the buyer country? It is possible that
the buyer may be interested to make payments but due to importer’s country’s balance
of payments problems, the exporter may not receive payment in freely convertible
currency as per Indian regulations.
 Special Packaging, Labelling and Marking: The exporter shall also look into any
kind of special packaging requested by importer. It is good to decide the packaging
specification of some perishable goods in the export order itself. Certain colours and
numbers are taboo in certain countries or for those importers. Countries like Germany
impose a legal restriction on exporter to get back the packing material. Exporters must

17
 cross-check all such issues and accordingly decide their price involving all such
hidden costs.
 Shipment and Delivery Date: If the exporter is comfortable to supply the goods by
that date; he shall also crosscheck that he has sufficient time to submit his documents
for negotiation/purchase/discounting with the bank for receiving the payments for that
export order.
 Marine Insurance: The exporter shall examine the shipping terms and responsibility
of availing insurance cover for the goods. If it is the exporter’s responsibility than he
shall discuss the insurance policy coverage with the importer and insurance company
as obtaining insurance cover in foreign countries is cheaper than in India and it affects
price. That is why importers are usually sensitive to this issue while signing a trade
deal with Indian exporters.

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PACKAGING IN DIFFERENT COUNTRIES

Here is a table that compares the packaging market size, growth, and type in the EU, USA,
and Middle East countries, based on some web search results.

Region Market Size (2024) CAGR (2024-2029) Packaging Type

EU USD 91.71 billion 4.47% Paper and paperboard

USA USD 207.94 billion 3.5% Plastic and flexible

Middle East USD 11.7 billion 5.2% Rigid and metal

Some of the factors that influence the packaging market in different regions are:

 The EU has strict regulations on packaging and labeling, which aim to protect the
environment and the health of consumers. The EU also promotes the use of eco-labels
and recyclable materials for packaging.
 The USA has a large and diverse consumer base, which demands innovative and
convenient packaging solutions. The USA also has a strong presence of e-commerce
and food and beverage industries, which drive the demand for plastic and flexible
packaging.
 The Middle East has a growing population and urbanization, which increase the
consumption of packaged goods. The Middle East also has a high demand for rigid
and metal packaging, especially for beverages, due to the hot and humid climate .

19
Sustainability in packaging

Sustainability in packaging is a megatrend shaping the packaging industry, with consumers

becoming increasingly worried about the environment and the impact of packaging leakage.
In response, new, stricter sustainability regulations are emerging on multiple fronts with
increasing frequency. However, regulatory focus and approaches vary considerably by region
and diverge even further when viewed at the country or state level. This heterogeneity is
making the fast-changing regulatory landscape complex to navigate on a worldwide basis. To
better understand the recent developments, we have mapped regulations in 30 countries
around the world. Our findings reveal several common patterns of development that can be
represented by four archetypes globally. To ensure they comply with the evolving
requirements, packaging companies should stay tuned to regulation developments in
sustainability packaging by tracking changes in their focus markets and implement processes
to address future requirements proactively. Most countries are moving toward setting up
regulations around sustainable packaging, though at different paces and in various depths.

Countries have mostly embarked on their sustainability journey by addressing the start and
the end of the flow—that is, the restriction of certain materials and a focus on waste
management via extended producer responsibility (EPR). More advanced countries have set
up infrastructure to support lasting changes in design, recycling capabilities, and recycled-
content use.

 Twenty-eight out of 30 countries have collection, sorting, and EPR schemes and
regulations in place or in development.
 More than 40 percent of the 30 countries studied already have an EPR scheme in
place.

20
Reference:https://www.mckinsey.com/industries/packaging-and-paper/our-
insights/sustainability-in-packaging-global-regulatory-development-across-30-
countries

21
Packaging-waste management is subject to the highest number of regulatory measures
worldwide (91 in total). In addition, there has been an increasing regulatory focus on more
specific areas of packaging, including the following:

Plastic packaging: In the past three years, sustainable-packaging regulations have tended to
focus primarily on plastic packaging (versus other substrates). 83% of the legal measures
relating to sustainable packaging worldwide focus on plastics—with a total of 147 measures
identified. The European Union and Asia have the highest number of regulations focusing on
plastics, with France and India being the top countries in this respect.

Beverage packaging: Regulations worldwide tend to have a relatively higher focus on

beverage packaging than on other categories such as food and home personal-care packaging.
However, there are noticeable regional differences:

 The European Union and North America focus more on beverages, with 50% to 60%
of their regulatory measures having a specific end-product scope targeting beverages.
 Latin America and the Middle East focus more on food packaging.
 In the European Union and Asia, an emerging trend aims to tackle packaging across
multiple product categories, reflecting a more holistic approach beyond a single focus
area (such as beverages) to encompass a broader spectrum of end-use areas.

Primary versus secondary packaging: Regulations tend to focus on primary packaging all
over the world, but a focus on secondary and tertiary packaging 1 is more prevalent in Asia:

 Worldwide, nearly 90% of legal measures with a specific scope of packaging type
tackle primary packaging alone or together with other packaging types (secondary,
tertiary).
 China, India, Vietnam, and the Philippines are proposing regulatory measures that
focus on secondary and tertiary packaging, while India has the most measures
focusing on secondary and tertiary packaging. China has also shown an increasing
focus on regulations around e-commerce packaging to minimize waste and leakage.

22
Reference:https://www.mckinsey.com/industries/packaging-and-paper/our-
insights/sustainability-in-packaging-global-regulatory-development-across-30-
countries

23
 CHAPTER – 2

COMPANY PROFILE

24
 CHAPTER – 2
COMPANY PROFILE

BALA EXPORTS (International Packing & Forwarding Services) is Freight Forwarding

Company. Freight forwarding is a crucial aspect of the logistics and transportation industry. It
refers to the process of coordinating and facilitating the movement of goods from one place
to another on behalf of a shipper, often a company or individual. Freight forwarders act as
intermediaries or service providers that manage various aspects of shipping and
transportation to ensure the safe, efficient, and timely delivery of cargo.

About Freight Forwarders

Key functions of a freight forwarder include:
1. Booking Transportation: Freight forwarders help shippers find suitable carriers, whether
it's by land, sea, air, or a combination of these modes. They negotiate contracts with carriers
to secure the best rates and options for their clients.

2. Documentation: They handle the extensive paperwork involved in international shipping,

including customs documentation, bills of lading, and other required paperwork to comply
with legal and regulatory requirements.

3. Cargo Consolidation: For smaller shipments, freight forwarders often consolidate multiple
smaller shipments into a single, larger shipment to reduce costs and increase efficiency.

4. Warehousing: Some freight forwarders offer warehousing services where goods can be
stored temporarily before being shipped to their final destination.

5. Customs Clearance: Freight forwarders navigate the complex world of customs regulations
and ensure that cargo complies with import and export requirements, facilitating smooth
passage through customs checkpoints.

6. Cargo Insurance: They may offer cargo insurance services to protect their clients'
shipments from loss or damage during transit.

7. Tracking and Monitoring: Freight forwarders use technology to track the movement of
cargo and keep clients informed about the status and location of their shipments.

8. Risk Management: They provide advice on risk mitigation strategies and help clients plan
for potential disruptions in the supply chain.

25
Overall, freight forwarding is a critical service that simplifies the logistics of shipping goods
domestically and internationally. It allows businesses to focus on their core operations while
experts handle the complexities of transportation, documentation, and regulatory compliance.

Parties involved in the shipping process freight forwarding

Manufacturer: The person who makes the goods, or the person who produced or made the
cargo, is the manufacturer. Knowing this is crucial since the customs requires information
about the product's manufacturer.

Consignor (exporter): The party who sells the cargo is known as the consignor, who is
typically a shipper.

Consignee (importer): The person that places the cargo order is known as the consignee, and
in shipping documents like a bill of lading, the consignee is typically a customer. For the
purposes of completing a customs declaration and paying duties and taxes, the consignee is
the owner of the shipment. Unless otherwise instructed, the cargo will normally be delivered
at the consignee's address.

Customs Agent: One who is knowledgeable in import and export law is known as a customs
agent. The customs agent is authorized to submit the necessary paperwork for cargo clearance
through customs and assist importers in paying duties.

Origin & Destination Agent: A person or business that organizes shipments at the origin port
is known as the origin agent. Similar to the origin agent, the destination agent is a person or
business who organizes shipments once they reach the destination port.

Freight forwarder: A freight forwarder is a person or company that a business arranges to ship
goods from its warehouse to its customer/final location.

Shipping Carrier (liner): The shipping carrier is the shipping line or airline that will
physically move the cargo

Documents for Freight Forwarding

 Commercial invoice: Serving as a customs declaration: It gives information to

customs officers about the items being sent, including their origin, value, and quantity,
so they can determine what duties and levies to impose.

26
 Packing list: A packing list is a list of all the items included in a box or shipment. It
provides information about each item's number, description, weight, and occasionally
dimensions. It accomplishes multiple goals:

o Assists the sender in making sure everything is packaged and sent with
the package.
o For the recipient: Makes organizing and verification simpler by giving
a concise summary of what to expect in the gift.
o Helps with precise shipment processing and management, including
weight calculations and possible duty assessments, for customs and
transportation companies.

 Export shipping Bill: An export shipping bill is a declaration of commodities meant

for export from a nation and is an essential document in international trade. It
promotes the seamless movement of products across borders and gives customs
authorities the information they need to clear it.

 Bill of lading: A bill of lading (B/L) is a crucial document in international trade,

acting as a legal contract between three parties:

o Shipper: The party exporting the goods.

o Carrier: The transportation company (airline, shipping line, etc.)
responsible for moving the goods.
o Consignee: The party receiving the goods (typically, the importer).

 Certificate of origin: Certificate of origin (CO) is another important document in

international trade. It acts as a declaration of origin for the product and is often called
"nationality". Its functions and meaning go beyond simple identification of origin

 Insurance certificate: Certificates of insurance are important to both carriers and cargo
owners, providing financial protection and facilitating smooth operations.

27
Name of the Company BALA EXPORTS
International Packing & Forwarding Services
Address Off No: 106, Eswaran Kovil Street, Pondicherry,
Puducherry, India – 605001.
Contacts Ph: +91 413 – 4200533
Email: [email protected]
GSTIN 34AACPB6333M2ZV
Established in the Year 2003
Frequent Destinations  France
 Spain
 Germany
 Canada
 USA
 Middle East Countries

Export Category  100 Percent Merchandises, where the freight

charges do not exceed the Indian Rupee Ten
Thousand (10,000/-).
 And the charges of Freight Delivery is fixed
based on the Weight of Package with respect
to the Destination.
 Merchandises includes:
Individual Packages like luggage, Cloths,
Vessels, Eatables, Groceries, Spices, Pickels.

Mode of Forwarding Both Water Ways and Air Ways for both Domestic
and International.
Other Party Logistics  Blue Dart
 World Wide Express
 Fright Bridge Logistics PVT LTD

28
 CHAPTER – 3

EXPORT – IMPORT PROCEDURES IN

BALA EXPORTS

29
 CHAPTER – 3
EXPORT – IMPORT PROCEDURES IN BALA EXPORTS

BALA EXPORTS (International Packing and Forwarding Services) that operates from
Pondicherry, established in the year 2003 is a small packing and forwarding service provider
that forwards the freight both domestically and internationally. And the maximum charges for
the service by Bala Exports is INR 10000/- that is fixed based on the weight of the package
and the destination.

Following flow chart describes the Freight forwarding process practiced in

Bala Exports

Customer ( Sender )

BALA EXPORTS

Third Party Logistics

Receiver

30
CUSTOMER: Individuals who wants to send their luggage and other merchandises are
the customers for the BALA EXPORTS. Mostly shipped merchandises are Groceries, Cloths,
Vessels, Spices, Pickels. Following are the documents required:

 Purchase Invoice: It’s a bill of the product or the document that acts like proof that
shows the ownership of the product by the customer (sender). This acts as a certificate
of origin at the inspection.
 ID Proof: Describes the citizenship of the customer of the sender that should include
the address and contact details like telephone number.
 Nonantique Certificate: A certificate by Archaeological Department in case of
shipping the statues and other heritage products.

BALA EXPORTS: Employees collect the said documents from the customers along with
the freight and makes the packaging list followed by packing of freight infront of customers
and weigh the package. Then they collect the destination and receiver details and prepare the
bill accordingly.

31
This freight is sent to Shipper i.e., third party logistics of Bala exports (World Wide Express,
Freight Bridge Logistics Pvt Ltd) by an Outsourcing company Blue Dart that collects the
required documents from the Bala Exports and communicates the Bill of Lading and Air Way
Bill. Here Third-Party Logistics deals with the Custom Clearance and regulatory documents
at each stage freight tracked by Air Way Bill number.

32
Following Picture is the Bill of Lading given by the shipper Freight Bridge
Logistics PVT LTD

33
CHAPTER – 4

CONCLUSION

34
 CHAPTER – 4
CONCLUSION

In international trade, documentation and procedures play a significant role. Full

knowledge and accurate compliance of procedures and documentation formalities are
essential. Inadequate understanding of the various formalities results in delays; and
prolonged correspondence, adversely affecting the business and cash flow, due to delays
in realisation of export proceeds and other incentives. No international trade transactions
can be completed without the assistance of at least three intermediaries. Documentation in
export business assumes greater significance as many parties/authorities are involved in a
single transaction. Proper documentation will ensure smooth sailing with the
requirements of each of these agencies and the resulting transaction will be a successful
one. Inaccurate or incomplete documentation will result in serious financial and goodwill
losses. Such losses can be completely avoided by understanding clearly the
documentation requirements of all concerned parties and then meticulously planning to
get the right documents in the right numbers, at the right places and at the right time.
Therefore, Internship on Export Import Procedures provided the practical knowledge and
in hands experience on Export procedures, documentation and freight forwarding service.

35
REFERENCES

 Aseem Kumar(2007) “Export and Import Management”, Excel Books

Publications, New Delhi.
 Ram Singh(2008) “Export Management” Indian Institute of Foreign Trade,
New Delhi
 Foreign Trade Strategy Vision and Approach – article on FTP 20223 – by
Institute Of Cost Accountants Of India.
 Key Highlights of FTP 2023 – Booklet by DGFT
 https://pib.gov.in/PressReleaseIframePage.aspx?PRID=1988357
 https://www.mckinsey.com/industries/packaging-and-paper/our-
insights/sustainability-in-packaging-global-regulatory-development-
across-30-countries

36
APPENDIX

37
38