1. Back-to-Back Letter of Credit: ancillary credit granted by bank in India against security of original LC which exporter has received from importer’s bank.
2. Bilateral Trade Agreement: refers to a trade agreement between 2 countries.
3. Multilateral agreement: Trade agreement between more than two countries is called multilateral trade agreement.
4. Blanket Permit: Lumpsum foreign exchange is provided to meet expenses abroad for market studies, advertising campaigns, participation in trade fairs, quality testing expenses.
5. Brand Piracy: It refers to forged popular brand names in foreign markets. The brand piracy is common is case of consumer goods.
6. Reasons for Brand Piracy:
a) Leniency of laws in several countries.
b) Craze for popular brands
c) Easy availability of technical know-how.
7. Break Even Point: It is that point at which the sales break even, i.e., the firm’s total sales revenue is equal is equal to the cost of goods sold.
8. Canalisation of Exports: It means exports to be undertaken only by the canalizing agency such as MMTC, NAFED, etc. in respect of certain specified items under the EXIM policy. For example, minerals are canalized through MMTC.
9. Capital Goods: It means any plant, machinery, equipment or accessories required for manufacture or production, either directly or indirectly, of goods or for rendering services, including those required for replacement, modernisation, technological upgradation or expansion.
10. Carting order: It is based by superintendent of Port Trust. It is the permission given by the port trust authorities to get the goods inside the docks.
11. Certificate of Origin: It is an important document in export trade. It is issued by concerned authorities such as EPCs, chambers of commerce, etc. It states the origin of goods, i.e., the country in which the goods are produced.
12. CIF Quotation: It refers to cost, insurance and freight. It includes all cost and expenses till the goods are loaded on the ship plus payment of insurance premium and freight charges.
13. Core Product: It is the primary level of a product. It constitutes the primary service or benefit that a customer is looking for.
14. Consular Invoice: It is an important document in export trade. It is certified by the Consular of the importing country located at the exporter’s country.
15. Deemed Exports: These are supplies made within India, and treated as exports for the purpose of certain benefits. Deemed exports include:
– Supply of goods to units in SEZ.
– Supplies made to 100% EOUs.
16. Deferred Payment Terms: Deferred Credit means the exporter receives the payment in instalment over a period of time. It is offered in case of sale of capital goods. The period of credit if exceeds over 180 days is called as deferred credit or deferred payment terms.
17. Dumping: It is a method of selling goods in the market at a low price, even below the cost of production. Dumping can take place in the domestic as well as the export markets.
18. Objectives of Dumping: The main objectives are:
– To capture a large market share.
– To get rid of outdated stock.
– To make optimum of production capacity.
– To achieve economics of large scale production.
– To create adverse effect on competitors through the price-war.
19. Duty Drawback: It refers to refund of customs duty paid on the import of components, consumables, or spare parts which are used for export production. It also includes refund of central excise duty on the items used for export production. There are two rates of DBK:
– All Industry Rates
– Special Brand Rates
20. ECGC: It stands for Export Credit Guarantee Corporation of India Limited. The two main objects of ECGC are:
– To project the exporters against credit risks, i.e. non-repayment by buyers.
– To protect the banks against loses due to non-repayment of loans by the exporters.
21. 100% EOUs: 100% Export Oriented Units manufacture the goods purely for export purpose. However, they can sell upto 50% of the production in local area, subject to payment of duties.
22. EPCG Scheme: It stands for export promotion capital goods scheme. Under this scheme, capital goods can be imported at a low duty subject to export obligation. At present the rate of duty is 5%.
23. EPZ: A free trade zone is an area near a sea/air port where firms can import goods duty free if they are to be re-reported or used in the manufacture of goods for export. At present, all the EPZs/FTZs are converted into SEZs (Special Economic Zones).
24. Export Marketing: It is a process of marketing goods and services beyond national borders. In the words of R.L. Kramer, “Export marketing involves exporting business with individuals, firms, organisations and/or government entities in other countries.
25. Export or Perish: This slogan was coined by Late Mr. J. Nehru in early 1960s. This slogan places lot on export earnings. This slogan states that if a nation increases its exports, it will prosper, or otherwise it will perish or face economic crisis.
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