Imports and exports are the two important components
of a foreign trade. Foreign trade is the exchange of goods and services
between the two countries, across their international borders.'Imports'
imply the physical movement of goods into a country from another country
in a legal manner. It refers to the goods that are produced abroad by
foreign producers and are used in the domestic economy to cater to the
needs of the domestic consumers. Similarly, 'exports' imply the physical
movement of goods out of a country in a legal manner. It refers to the
goods that are produced domestically in a country and are used to cater
to the needs of the consumers in foreign countries. Thus, the imports
and exports have made the world a local market. The country which is purchasing
the goods is known as the importing country and the country which is selling
the goods is known as the exporting country. The traders involved in such
transactions are importers and exporters respectively.
In India, exports and imports are regulated
by the Foreign
Trade (Development and Regulation) Act, 1992, which replaced the Imports
and Exports(Control) Act, 1947, and gave the Government of India enormous
powers to control it. The salient features of the Act are as follows:-
- It has empowered the Central Government
to make provisions for development and regulation of foreign trade by
facilitating imports into, and augmenting exports from India and for
all matters connected therewith or incidental thereto.
- The Central Government can prohibit,
restrict and regulate exports and imports, in all or specified cases
as well as subject them to exemptions.
- It authorizes the Central Government
to formulate and announce an Export
and Import (EXIM) Policy and also amend the same from time to time,
by notification in the Official Gazette.
- It provides for the appointment of
a Director General of Foreign Trade by the Central Government for the
purpose of the Act. He shall advise Central Government in formulating
export and import policy and implementing the policy.
- Under the Act, every importer and
exporter must obtain a 'Importer
Exporter Code Number' (IEC) from Director General of Foreign Trade
or from the officer so authorised.
- The Director General or any other
officer so authorised can suspend or cancel a licence issued for export
or import of goods in accordance with the Act. But he does it after
giving the licence holder a reasonable opportunity of being heard.
- As per the provisions of the
Act , the Government
of India formulates and announces an Export and Import policy (EXIM
policy) and amends it from time to time. EXIM policy refers to the policy measures adopted by a country with reference to its exports and imports. Such a policy become particularly important in a country like India, where the import and export of items plays a crucial role not just in balancing budgetary targets, but also in the over all economic development of the country. The principal objectives of the policy are:-
- To facilitate sustained growth
in exports of the country so as to achieve larger percentage share
in the global merchandise trade.
- To provide domestic consumers
with good quality goods and services at internationally competitive
prices as well as creating a level playing field for the domestic
- To stimulate sustained economic
growth by providing access to essential raw materials, intermediates,
components, consumables and capital goods required for augmenting
production and providing services.
- To enhance the technological strength
and efficiency of Indian agriculture, industry and services, thereby
improving their competitiveness to meet the requirements of the
- To generate new employment opportunities
and to encourage the attainment of internationally accepted standards
Besides this Act, there are some other laws
which control the export and import of goods. These include:-
At the central level, the Ministry
of Commerce and Industry is the most important organ concerned with
the promotion and regulation of the foreign trade in India. The Ministry
has an elaborate organizational set up to look after the various aspects
of trade. Within the Ministry,the Department
of Commerce is responsible for formulating and implementing the foreign
trade policy. The Department is also entrusted with responsibilities relating
to multilateral and bilateral commercial relations, state trading, export
promotion measures and development and regulation of certain export oriented
industries and commodities.The matters relating to foreign trade are dealt
with by the following divisions
of the Department :-
1. Administrative and General Division
2. Finance Division
3. Economic Division
4. Trade Policy Division
5. Foreign Trade Territorial Division
6. Export Products Division
7. Export Industries Division
8. Export Services Division
9. Supply Division
The Department's jurisdiction extends
(a) Two Attached Offices:-
General of Foreign Trade (DGFT):- with its headquarters at New Delhi,
is headed by the Director General of Foreign Trade. It is responsible
for implementing the Foreign
Trade Policy/Exim Policy with the main objective of promoting Indian
exports. The DGFT also issues licences to exporters and monitors their
corresponding obligations through a network of regional offices. The
regional offices are located at 33 places.
General of Supplies and Disposal (DGS&D):- with its headquarters
at New Delhi, is headed by the Director General. It functions as the
executive arm of the Supply Division of the Department of Commerce for
conclusion of Rate
Contracts for common user items, procurement of stores, inspection
of stores, shipment and clearance of imported stores/cargo. It has three
Regional Offices located at Chennai, Mumbai and Kolkata.
(b) Five Subordinate Offices:-
General of Commercial Intelligence and Statistics (DGCI&S):-
with its office located at Kolkata, is headed by the Director General.
It is entrusted with the work of collecting, compiling and publishing/
disseminating trade statistics and various types of commercial information
required by the policy makers, researchers, importers, exporters, traders
as well as overseas buyers.
- Office of Development Commissioner
of Special Economic Zones:- The Special
Economic Zones (SEZs) are geographically exclusive enclaves separated
from domestic tariff areas. The main objective of SEZs is to provide
certain common facilities and a duty free environment for exporters.
Each Zone is headed by a Development Commissioner and is administered
as per the SEZ scheme announced on 31st March, 2000.
of the Custodian of Enemy Property (CEP):- is located in Mumbai
with a Branch office at Kolkata. The office is functioning under the
Property Act,1968. All immovable (like land, buildings, etc.) and
movable properties (like securities, shares, debentures, bank balances,
viz. fixed deposits and other amounts lying in the enemy nationals'
bank accounts, Provident fund balances etc.) all over India belonging
to or held by or managed on behalf of Pakistani nationals between the
period 10.9.1965 and 26.9.1977 are vested in the Custodian of Enemy
Property for India.
- Pay and Accounts Office (Supply):-
The payment and accounting functions of Supply Division, including those
of DGS&D, are performed by the Chief
Controller of Accounts (CCA) under the Departmentalized Accounting
System. Payment to suppliers across the country is made through this
and Accounts Office (Commerce & Textiles):- The Pay and Accounts
Office, common to both the Department of Commerce and the Ministry of
Textiles, is responsible for the payment of claims, accounting of transactions
and other related matters through the four Departmental Pay & Accounts
Offices in Delhi, two in Mumbai, two in Kolkata and one in Chennai.
(c) Ten Autonomous Bodies:-
Board :- The Coffee Board of India is an autonomous body, functioning
under the Ministry of Commerce and Industry, Government of India. The
Board serves as a guide of the coffee industry in India. The Board focuses
on research, development, extension, quality upgradation, market information,
and the domestic and external promotion of Indian coffee.
Board :- The board is engaged in the development of the rubber industry.
This is done by assisting and encouraging scientific ,technical and
economic research; supplying technical advice to rubber growers; and
training growers in improved methods of plantation and cultivation.
Board :- The primary functions of tea board include rendering financial
and technical assistance for cultivation,manufacture,marketing of tea;
promoting tea exports ;aiding research and developmental activities
for augmentation of tea production and improvement of tea quality as
well as encouraging and assisting small growers sector financially and
Board:- The Government of India established the Tobacco Board, in
place of Tobacco Export Promotion Council, under the Tobacco
Board Act of 1975 to regulate production, promotion of overseas
marketing and to control recurring instances of imbalances in supply
and demand, which lead to market problems,The Tobacco Board Act aims
at the planned development of Tobacco Industry in the country. The activities
of the Board includes the regulation of the production and curing of
Virginia Tobacco with regard to the demand in India and abroad.
Board :- Spices Board was constituted on 26th February 1986 under
Board Act 1986. It is one of the Commodity Boards functioning under
the Ministry of Commerce & Industry. It is an autonomous body responsible
for the export promotion of the scheduled spices and production or development
of some of them such as Cardamom and Vanilla.
Inspection Council (EIC), New Delhi :- The Export Inspection Council
is responsible for the enforcement of quality control and compulsory
preshipment inspection of various commodities meant for export and notified
under the Export
(Quality Control & Inspection) Act, 1963.
Institute of Foreign Trade (IIFT), NewDelhi :- is engaged in the
- Training of Personnel in modern
techniques of international trade;
- Organisation of Research in
problems of foreign trade;
- Organisation of marketing research,
area surveys, commodity surveys, market surveys;
- Dissemination of information
arising from its activities relating to research and market studies.
Institute of Packaging (IIP), Mumbai :- is registered under the
Societies Registration Act.The main aim of this Institute is to undertake
research of raw materials for the packaging industry, to organise training
programmes on packaging technology and to stimulate consciousness of
the need for good packaging etc.
Products Exports Development Authority (MPEDA), Kochi :- functions
under the Ministry of Commerce, Government of India and acts as a coordinating
agency with different Central and State Government establishments engaged
in fishery production and allied activities. The Authority is responsible
for development of the marine products industry with special focus on
marine exports. The role envisaged for the MPEDA is comprehensive covering
fisheries of all kinds, increasing exports, specifying standards, processing,
marketing, extension and training in various aspects of the marine industry.
and Processed Food Products Export Development Authority (APEDA), New
Delhi :- came into existence in 1986 to further develop agricultural
commodities and processed foods, and to promote their exports.The aim
is to maximize foreign exchange earnings through increased agro exports,
to provide better income to the farmers through higher unit value realization
and to create employment opportunities in rural areas by encouraging
value added exports of farm produce.
Promotion Councils (EPCs):-
Presently there are twelve EPCs under
the administrative control of the Ministry of Commerce.These councils
are registered as non-profit organisations under the Companies
Act.The Councils perform both the advisory and executive functions.These
councils are also the registering authorities under the Import Policy
for Registered Exporters.
(e) Other Organisations:-
(f) Advisory Bodies
of Trade (BOT):- was set up on May 5, 1989 with a view to providing
an effective mechanism to maintain continuous dialogue with trade and
industry in respect of major developments in the field of International
Promotion Board (EPB):- provide policy and infrastructural support
through greater coordination amongst concerned Ministries for boosting
the growth of exports.
General of Anti-Dumping & Allied Duties (DGAD):- The Directorate
is responsible for carrying out investigations and to recommend, where
required, under Customs Tariff Act, the amount of anti-dumping duty/countervailing
duty on the identified articles which would be adequate to remove injury
to the domestic industry.
(g) Public Sector Undertakings:-
The following trading/service corporations
are functioning under the administrative control of the Department of