Trade Protectionism is the economic policy of restraining trade between nations, through methods such as high tariffs on imported goods, restrictive quotas, and anti-dumping laws in an attempt to protect domestic industries in a particular nation from foreign take-over or competition. This contrasts with free trade, where no artificial barriers to entry are instituted. Trade Protectionism has frequently been associated with economic theories such as mercantilism, the belief that it is beneficial to maintain a positive trade balance, and import substitution. There are two main variants of trade protectionism, depending on whether the tariff is intended to be collected (traditional protectionism) or not (modern protectionism). Modern protectionism: In the modern trade arena many other initiatives besides tariffs have been called protectionist. For example some economists see developed countries’ efforts in imposing their own labor or environmental standards as protectionism. Also, the imposition of restrictive certification procedures on imports are seen Continue reading
International Trade Laws
Common Export Documents – Export Invoice
An export invoice is the basic document which gives full details of the contents of the shipment and serves as seller‘s bill of goods and sets out the terms of sale. An invoice usually means a Commercial invoice. An exporter must prepare this document which will fully identify the overseas shipment and serve as a basis for the preparation of all other documents. There is no standard form for an export invoice and it is the exporter’s choice to design his own form. The invoice is prepared for the buyer abroad. Any special requirement of the importer must be duly complied with. The following are the essential details which should be available in the export invoice: Name and address of the exporter Invoice number and date Buyer’s and Seller’s Order numbers Name and address of the overseas customer Name of the vessel and sailing date Unit price and total value Continue reading
Quality Standards For Exports
In almost all the products, for which the pre-shipment inspection scheme has been introduced, great care has been taken to accept the buyer’s requirements, wherever known, as the basis of inspection. In many cases, where the buyer’s requirements are known through-an approved sample of, for example, footwear or handicrafts, inspection is carried out on the basis of the approved sample. However, for items involving safety, such as cables and conductors, only the national standards, either Indian or those of the importing country, have been adopted. In the case of commodities involving health hazard, such as fish and fishery products, statutory laws as applicable in the importing country for these products, are adhered to. This particular approach has been found to be extremely practical and has helped the exporters to maintain the quality of their products. For adopting or establishing technical specifications, detailed discussions are held with the trade and industry Continue reading
Types of Marine Insurance Policies
Marine insurance is a contract by which the insurer, in consideration of payment by the insured of a specified premium determined under tariff rates or otherwise, agree to indemnify the latter against any loss incurred by him in respect of the merchandise exposed to the perils of the sea or to the particular perils insured against. In a c.i.f. contract, marine insurance is obligatory, and the policy must be one which is usual in the trade and is in a negotiable form. The policy must be stamped and bear a date not later than that of the bill of lading; and if the export is under a letter of credit, it must conform to the terms and conditions laid down in it. Types of Marine Insurance Policies 1. Single Cargo Risk / Open or Blanket Policy A marine insurance policy may be a “single cargo risk” policy, i.e., a policy Continue reading
Foreign Exchange Restrictions
Although the direct intervention methods referred to have influenced many exchange rates, they do not fully serve the needs of countries with a continuous shortage of foreign exchange. To supplement the direct measures many countries adopted a number of foreign exchange restrictions. Most countries have employed foreign exchange restrictions from time to time. Developing countries especially have found restrictions necessary to secure compliance with their development plans. An exchange restriction plan implies that the government restricts the uses to which the available supply of exchange shall be put. Foreign exchange may be allocated specially for the payment of import bills, interest on foreign loans, and on other specific purposes. Sometimes the restrictions prevent the use of exchange for trade with a given (unfriendly) country. In the latter case the purpose may be political, but the basic reason for most foreign exchange restrictions is the shortage of foreign exchange sufficient to Continue reading
Quality Control and Pre-shipment Inspection for Exports
In today’s sophisticated world market, a product can move with any measure of success only if it is competitive enough in price and quality. Our export can be sustained and improved only be raising the quality of our product as it would be very difficult to reduce the price in our present day high-cost economy, with a view to achieve this objective of raising the quality of our export products, the Government of India enacted the legislation entitled “The Export (Quality Control and Inspection) Act” in the year 1963, and the Export Inspection Council was also set up with effect from 1st January, 1964. The main function of the Export Inspection Council is to advise the government with regard to measures to be taken for quality control and pre-shipment inspection of exportable commodities. No Consignment of any notified commodity can be exported unless it is accompanied by a certificate issued Continue reading