Rekha Garments has received an order to export 2000 men's trousers to Swift Importer Ltd. located in Australia

Rekha Garments has received an order to export 2000 men’s trousers to Swift Importer Ltd. located in Australia. Discuss the procedure that Rekha Garments would need to go through for executing the export order.

The main steps involved in exporting goods from India are as follows :

  1. Obtaining Import-Export Code (IEC) : Before
    starting the export procedure, the exporter has to obtain I.E.C. number. This number is used in filling the formalities of export procedure. To get this number, the exporter has to apply to the Regional Import-Export Licensing authority in the prescribed form.
  2. Obtaining Registration cum Membership
    Certificate (RCMC): Exporters get various benefits in the form of subsidies and exemption in excise duty, tax, etc. To get these benefits they have to show RCMC. After obtaining the I.E.C. number, the exporter applies for RCMC.
  3. Market research : After obtaining the IEC number
    and RCMC, the steps of export procedure start by conducting market research in the foreign country to find out the prospective buyer for their products.
  4. Confirmation to importer : After receiving the
    export order the exporter examines the order carefully. If the exporter is satisfied that he will be able to meet the order according to specifications, then he sends a confirmation letter to the importer stating the time period in which he will be able to export the goods.
  5. Manufacturing goods : After sending the
    confirmation to the importer, the exporter starts manufacturing the product according to the specifications. If the exporter is not a manufacturer, then he starts procuring the goods from different manufacturers as per the specifications of export order.
  6. Excise clearance : The exported goods are
    generally exempted from excise duty and if duty is already paid, then it is refunded back to the exporter. To get exemption, the exporters apply to Excise Commissioner along with a copy of RCMC, Invoice, etc.
  7. Inspection and quality control : Quality plays a
    very imortant role in external trade. Exporters have to follow international quality standards. The goods are produced strictly according to the quality specifications of buyers. In India, it is compulsory to get a pre-shipment quality inspection according to the Export (Quality Control and Inspection) Act. The government has prescribed certain quality standards keeping in mind the safety and health of the people.
  8. Customs clearance: Goods cannot be sent to another
    country without getting customs clearance.
  9. Port procedure : The exporter has to get the permission from port authorities also because goods are loaded to ship from port only. The exporter gets the permission by paying port charges and after completing all formalities as per the instruction of the shed appraiser officer.
  10. Obtaining bill of lading : After loading the goods
    on ship, the exporter goes to the office of the shipping company. There he surrenders the mate’s receipt and in return, the shipping company office issues him a bill of lading, with three copies-one copy for exporter, one copy for captain of the ship and one copy for the importer.
  11. Preparation of invoice : The exporter prepares an invoice for the dispatched goods. The invoice contains information regarding the quantity of goods sent and the amount to be paid by the importer. It is duly attested by the customs.
  12. Submission of documents to bank : After the submission of documents and receiving of payments from the bank, the export procedure ends.