INTRODUCTION

WHAT IS FOREIGN TRADE:

 Foreign Trade has two aspects, namely, export and import trade. While Export Management relates to export of goods and services, Import Management relates to imports of goods and services.

 Foreign Trade, after the liberalization of economic policies initiated during 1991 onwards has occupied a special place in the Indian economy. With this process, export and import have started moving on a fast track with the result that today India has come to stay as a key player in most of the thrust areas like Apparel, Biotechnology, Engineering, Electronics, Food  Items, Gem and Jewellery, Handicrafts, Handlooms,   services like IT and ITES. We are now an  Information Hub, Product suppliers and as the environment is changing, India is likely to progress in a big way in future in industrial, agricultural and services sectors. The policies of the Government, the requirements of the overseas markets and the competitive advantages which India enjoys will help in extending our horizons in a big way. During the last decade, an environment has been created which has attracted the Indians to enter into export and import trade in a big way. 

EXPORT BUSINESS IS PROFITABLE: 

Export is one of the most lucrative business activities in India.  The Govt. also provides various incentives to the exporters for earning valuable foreign exchange for the country for meeting their requirements for importing modern technology and essential inputs.  Besides, the income from export business is also exempt to the specified extent under the Income Tax Act, 1961.  Refund of Central Excise and Custom Duty on export is also made under the Duty Drawback Scheme of the Government.  Drawback payment procedures have been simplified.  Duty free import of raw materials is allowed under various schemes incorporated in the Foreign Trade Policy for 2004-2009. Replenishment Licences are also available/given against export of certain specific items.  Export oriented units under the EOU Scheme and units located in Free Trade/Export Processing Zones/Special Economic Zones are eligible for special facilities, such as exemption from excise/custom duty, sale in domestic tariff area including sale of rejected goods/wastage etc.  Special facilities are also available for Electronics Hardware Technology Parks (EHTP) and units under Software Technology Parks (STP) Schemes. To boost exports of goods and services, new incentive schemes like Duty Free Credit Entitlements, Target Plus and Vishesh Krishi Upaj Yojana have been introduced. Special scheme has been introduced for the handicrafts sector, handloom sector, leather sector.  Foreign Exchange Regulations have been substantially liberalised for exports.  Liberal release of foreign exchange is made available for travel abroad.  Norms for establishing offices abroad by the exporters have been eased.  Export credit is available to the exporters at concessional rates of interest.  The same can be availed of in Indian rupees as well as in foreign currency.  Interest tax on export credit has been abolished.  Export Credit and Guarantee Corporation is overhauling its international operations.  Transport subsidy is given for export by Air as well as Rail.  Import Policy has also been liberalised substantially for export oriented imports.  Domestic Companies have been allowed to bid in any currency.  Various Customs houses have introduced EDI system of computerised processing of import and export transactions.