2010
Summer Training Report
On
EXPORT AND DOCUMENTATION
&
INDIAN TEXTILE
Submitted in Partial Fulfillment for the Award of the Diploma of
Post Graduate Diploma in Management
(Session 2009-11)
Submitted to: Examination controller
PGDM
: I yr
DEPARTMENT OF MANAGEMENT
INSTITUTE OF MANAGEMENT STUDIES, NOIDA
A UGC Recognized Institute
A-8B, Plot –C, Sector-62, Noida
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Certificate from the Company
The project report titled “EXPORT AND DOCUMENTAION & INDIAN
TEXTILE.” submitted by
Signature
(Name of Guide)
Date- /
/2010
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Certificate from Internal Guide
The project report titled “EXPORT AND DOCUMENTAION & INDIAN
TEXTILE.” submitted by
Signature
Signature
(Name of Co-Guide)
Date: -
/
(Name of Guide)
/2010
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TABLE OF CONTENTS
PAGE NO
1.
OBJECTIVE OF THE STUDY
10
2.
RESEARCH METHODOLOGY
11
3.
RESEARCH DESIGNE
12
4.
BACK GROUND OF THE STUDY
12
5.
NEED OF THE STUDY
13
6.
SCOPE OF THE STUDY
13
7.
CHAPTER-1 DCM LTD
14
1.1 History 15
1.2 Company profile 15
1.3 History of DCM Shriram Industries Ltd. 18
1.4 Corporate Ethos 23
1.5 Quality System 24
1.6 Product Of DCM Shriram Industries Ltd 24
1.7 Environment, Health & Safety 24
1.8 Social Commitment 25
1.9 Rural Development 26
1.10 Product Range 26
1.11 Past Performance 28
1.12 Recent Development 30
8.
CHAPTER -2 INTERNATIONAL BUSINESSES
31
2.1International Transaction 31
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2.2 EXIM Flow 32
2.3Export Procedure 33
2.4Export Documentation 36
2.5 Export Invoice 37
9.
CHAPTER-3 EXPORT BUSINESS
40
3.1To start an Export Business 41
3.1 (a) Proprietorship\Sole trade ship41
(b)Partnership Firm 41
(c)Joint Hindu Family Firm 42
(d)Trust 42
(e)Co-operative Society 42
(f)Private Company 42
(g)Public Company43
(h)Letter Head 43
(i)Rubber Stamp 43
(j)Bank Account 43
(k)Permanent A/c No 44
(l)Importer Exporter Code No 44
(m)Business Identification No 44
(n)SSI Registration 45
(o)Sales Tax Registration 45
(p)Central Excise 45
(q)Registration with Export Promotion Councils 45
(r)Clearing & Forwarding Agent 46
(s)Sequential Steps towards Export Operations 46
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10.
CHAPTER -4 EXPORTS AND DOCUMENTAION
52
4.1Export Documentation 52
4.2ADS 52
4.3Standardized and Aligned Pre-shipment Export Document 53
4.4Regulatory Documents 55
4.5Document Connected with Transportation of Good 55
4.6Commercial Document 57
4.7Insurance Document 58
4.8Financial Document 59
4.9Third Party Document 62
11.
CHAPTER-5 INDIAN TEXTILE
65
5.1Introduction 66
5.2History 66
5.3Literature Review 67
5.4Overview of Indian Textile Industries 67
5.5Total Production of Yarn in India 70
5.6Indian Textile Export 71
5.7Major Textile Export Promotion Council of India 72
5.8Indian Textile Policy 74
5.9Swat Analysis of Indian Textile 76
12.
CHAPTER-6 DATA ANALYSIS
79
6.1 (a) Duration of Purchasing Habits of People 80
6.1(b) Buying Habits of People 81
6.1 (c) Buying Destination of Customer 82
6.1 (d) Purchasing limits of Customer 83
6.1 (e) Purpose of Purchasing of Readymade Garments 84
6.1 (f) Reference for Purchase 85
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6.1 (g) Companies with most Festival Offer 86
6.1 (h) Market share of the Major Textile Companies 87
6.1 (i) Rate Provided by the People 88
6.2FINDING, SUGGESTION&CONCLUSION 89
6.3BIBLIOGRAPHY 91
13.
QUESTIONNAIRE
92
LIST OF TABLE
1. Organizational Chart 16
2. Product & Units 23
3. Product & Quality 25
4. International Transaction 31
5. EXIM FLOW Chart 32
6. Export Procedures 33
7. Export Documentation 36
8. Export Procedures Flow Chart 39
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LIST OF GRAPH
1. Durations of Purchasing Habits of People 80
2. Buying Habits of People 81
3. Buying Destination of Customer 82
4. Purchasing limits of Customer 83
5. Purpose of Purchasing of Readymade Garments 84
6. References for Purchase 85
7. Companies with most Festival Offer 86
8. Market shares of the Major Textile Companies 87
9. Rate Provided by the People 88
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OBJECTIVE OF THE STUDY
The main objectives of the research were:

To know about export import process.

To know what are the documents required before and after sailing the cargo.

To know about international business and trade.

To determine the exact position of Indian Textile Industry.

To know about the areas where it is lacing.

To know the opportunities of the industry in future.

To know the effect of the current competitive environment on the Indian
Textile Industry.

To determining the demand of Indian textile products in international market.
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RESEARCH METHODOLOGY
The different primary and secondary data’s has been used in the research project
report. For the aspects, the secondary data analysis has been takes into
consideration, but maximum areas and parts of the project has been covered
by primary data’s.
SAMPLE DESIGN
1. SAMPLE UNIT: - All working people are included both the genders i.e. males and
females irrespective of their education level.
2. SAMPLE SIZE: - 200
3. SAMPLE REGION: - Noida –18 Region, Central Delhi.
DATA COLLECTION METHOD
1. PRIMARY DATA: - Primary data was collected through a self administrated
questionnaire. This questionnaire aims to gather information related to various
readymade garments.
2. SECONDARY DATA: - Secondary data was collected through magazines,
research papers, internet etc.
RESEARCH INTRUMENTS
QUESTIONNAIRE DESIG: - As the questionnaire is self administrated one, the
survey is kept simple and user friendly. Words used in questionnaire are
readily understandable to all respondent. Also technical jargons are avoided to
ensure that there is no confusion for respondents.
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RESEARCH DESIGN
Research design is the based framework, which provides guidelines for the research
process. It is a map or blue print according to which the research is to be
conducts. The research design specifies the methods for data collection & data
analysis determine the source of data. Most specifically it was a kind of
“Descriptive conclusive research” who takes care of who, when, where,
what, how and why aspects of the investigation further the researcher used the
statistical method to serve the purpose of project, it permitted the research to
derive more accurate generalization whose reliability could be measured.
CENTRE
RESEARCH
: ALL OVER INDIA
: EXPLORATORY
RESEARCH TECHNIQUE
TOOL USED
DATA SOURCE
: QUALITATIVE & QUANNTATIVE
: TELEPHONIC & E-MAIL
: PRIMARY & SECONDARY
BACKGROUND OF THE STUDY
Textile is the oldest business of Indians. Mainer places in India
accounting for its remarkable achievement in the field of textiles. It is a major
source of the earning of the revenue generation for the country. From the last
50 years after the independence, this sector continuously is a part of the
revenue generation of the countries. It is a major industry in employment
generation of the country. From the last couple of years, it accounting for a
leading role in the GDP of the country. It accounts for around 4 per cent of
the gross domestic product (GDP), 14 per cent of industrial production and
over 13 per cent of the country's total export earnings. Moreover, it provides
employment to over 35 million people. The Indian textile industry is estimated
to be around US$ 52 billion and is likely to reach US$ 115 billion by 2012.
The domestic market is likely to increase from US$ 34.6 billion to US$ 60
billion by 2012. It is expected that India's share of exports to the world would
also increase from the current 4 per cent to around 7 per cent during this
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period. India's textile exports have shot up from US$ 19.14 billion in 2006-07
to US$ 22.13 billion in 2007-08, registering a growth of over 15 per cent.
NEED OF THE STUDY
The study will provide a clear and brief view about the current
situation and future prospect of the Indian Textile sector. As it is said that the
Indian Textile sector is the one of the old and more profit earning sector from
many years. The study will give the perfect overview and actual analysis of
the relevant data’s for the clear picture of the industry. There are following
need for the study of the report. •Increase in the international demand of the apparels and clothes.
•Entry of multinational companies in the India.
•Implementation of different promotion policies of govt.
•Providing fruitful information to the major companies of India’s textile sector.
SCOPE OF THE STUDY
The scope of marketing research in international business could cover the
business problems relating to the followings.

Types of consumers that compromise present and potential markets.

Buying habits and pattern of consumption

Size and location of different markets, not only in India but also overseas.

The prospects for growth or construction for the current markets being served.

New mantras of emerging segments.

Marketing and manufacturing capabilities of competitors.

Most suitable entry timing.

The current and prospective competitive position.

Chances of improvement of current channels.
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CHAPTER N0-1
Company Profile
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1.1 Histosry - DCM Ltd
2004
- DCM Shriram Infrastructure Ltd. (DSIL) has become a subsidiary of another
Subsidiary, DCM Shriram Credit and Investments Ltd. (DSCIL). Consequently DSIL
has become a Subsidiary of DCM Shriram Consolidated Ltd. also. DSCIL and DSIL
are closely held and unlisted companies.
-DCM Shriram Chairman elected as Deputy Chairman for CII (North)
2005
-Fenesta rolls out new range of window, door systems
1.2 COMPANY PROFILE
DCM Shriram Industries Limited (DSIL) is an India-based company. The Company
has operations in sugar, alcohol, fine chemicals, rayon tyrecord, and textiles.
The six manufacturing sites of the Company are Daurala Sugar Complex,
Shriram Rayons, Daurala Organics Ltd., DCM Hyundai Ltd., Indital Tintoria
Ltd. and DCM Remy Ltd. Daurala Sugar Complex comprises a cane sugar
plant, distillery and an aromatic chemical unit. Shriram Rayons manufactures
rayon tyre cord with nylon and rayon conversion facilities catering to the
needs of both domestic and overseas markets. Daurala Organics is engaged in
manufacturing of drug intermediates. Indital Tintoria is focused on processing
100% cotton yarn. DCM Remy is engaged in the production of liquors and
DCM Hyundai is engaged in the production of shipping containers.
A series of ISO 9000 certified DCM Shriram Industries Ltd was formed in 1990 after
the restructuring of DCM group by combining five units of DCM group
namely Sugar factory at Daurala, Distillery at Daural, Rayon tyre cord plant at
Kota, Liquor Operations at Daurala and Aromatic Chemicals Plant at Daurala.
The company is essentially a manufacturer of Sugar, Alcohol, Chemicals and
Rayons.
The company has five manufacturing units in India. Daurala Sugar works is
located at Daurala, UP where Sugar, Refined sugar, Pharma Grade Sugar,
Alcohol, Potable Liquor and Aromatic Chemicals are manufactured. Products
like Industrial Rayon, Nylon and Chemicals are manufactred at Shriram
Rayons, Kota, Rajasthan. Daurala Organics manufactures Drug Intermediates
and Fine Chemicals. DCM Hyundai Ltd and Daurala Food and Beverages (P)
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Ltd are Shriram's promoted companies. DCM Hyundai Ltd located at
Pollivakkam, Tamil Nadu manufactures Dry Cargo Marine Freight Containers,
Freight Containers for Trucks and Sheet and metal fabrications and Daurala F
and B (P) Ltd is manufacturer of Scotch and Blended Whickies and Liqueurs.
The company had promoted ISO 9002 certified Daurala Organics Ltd in 1994
to manufacture high technology, high value drug intermediates.
Under a Scheme of Arrangement approved by the shareholders and creditors of the
Company and also by the Hon'ble Delhi High Court vide their Order dated 164-90 the Company (DCM Ltd) now stands divided into four companies’ w.e.f.
1-4-90 as follows:
i) DCM Limited
ii) DCM Shriram Industires Ltd
iii) DCM Shriram Consolidated Ltd
iv) Shriram Industrial Enterprises Ltd
1.2(a) BOARD OF DIRECTORS
Tilak Dhar
Chairman of the Board, Managing Director
D. C. Mittal
President
N. K. Jain
Chief Financial Officer
Anil Gujral
Chief Executive Officer - Chemicals & Alcohol
P. V. Bakre
Senior Vice President
B. P. Khandelwal
Senior Executive Director, Company Secretary, Compliance
Officer
Madhav B. Shriram
Whole-Time Director
Alok B. Shriram
Deputy Managing Director, Director
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G. Kumar
Director - Sugar Operations, Director
K. N. Rao
Chief Operating Officer - Rayons
1.2(b) ORGANIZATION CHART
SIR SHRIRAM (FOUNDER)
MURLI DHAR
SHRI DHAR
Dcm shriram
consolidated
ltd
SBGI/bloseeds
ltd
BANSI
DHAR
DCM shriram
indust ltd
Daurala
organics
DCM hyundai
BHARAT RAM
CHARAT RAM
VINAY/VIVE
K
ARUN
DCM ltd
SRF
DCM financial
services
DCM
benetton
DSCL
esco(100%
subsidiary)
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SIDDHART/DEEPAK
SIEL
Jay engg
Usha
international
Shriram pistons
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1.3 History of DCM Shriram Industries Ltd.
Under a 'Scheme of Arrangement' approved by shareholders & creditors of Comp. &
also by Honourable Delhi High Court vide their Order dated 16-4-90 the
Comp. [DCM Ltd] now stands divided into four companies w.e.f. 1-4-90 as
follows :
[1] DCM Limited [2] DCM Shriram Industires Ltd [3] DCM Shriram Consolidated
Ltd [4] Shriram Industrial Enterprises Ltd
As per the scheme, the shareholders of DCM Ltd. will be allotted shares in DCM
Shriram Industries limited & Shriram Industrial Enterprises limited in the ratio
of one share in each of above Companies for every four shares held by then in
DCM Ltd. as on 21-9-1990.
Pursuant to the scheme three units namely. Daurala Sugar Works, Shriram Rayons &
Hindon River Mills have been vested with the Company.
2000 - Credit rating agency has retained the MD rating, indicating default to the fixed
deposit programme of company.
2001- The Board of Directors of Comp. has approved as under : 1. Hiving off of its
Polymer Processing Business on a going concern basis to its 91% subsidiary
DCM Shriram Exports Ltd.
- The communication issued to the BSE, DCM Shriram Industries Ltd has informed
that Shri D.C.Mittal, Joint Managing Director has demitted office on
December 11, 2001
- DCM Shriram Industries Ltd has informed that the Board of Directors of Comp. at
its meeting held on January 14, 2008, has co-opted Shri. S B Mathur on the
Board as an Additional Director. He will be an independent director.
-DCM Shriram Industries Ltd has re-appointed Shri Alok B Shriram as Dy. Managing
Director for further period of 5 years w.e.f. October 01, 2008.
DCM is a part of DCM group which was incorporated in the year of 1889 and is
engaged in manufacturing of engineering products and textiles. The different
divisions of DCM group are engineering products, tolls and dyes, precision
engineering, textiles and real estates. The company has its plants at Asron
(Punjab), Hissar (Haryana) and New Delhi. DCM`s principal businesses
constitute textiles, information technology and real estate.
DCM basically has three different divisions Textiles, Information Technology
and Real Estate.
Its Textiles division is a Spinning Mill located in Hisar (Haryana) engaged in
the manufacturing of 100% grey cotton yarn and Melange yarn in the count
range of 14`s to 40's, for usage in knitting fabrics and weaving of terry towels.
The unit has a line of new generation machines from renowned manufacturers
like M/s. schlafhorst A.G (Germany), Rieter (Germany), Crosrol (UK), Laxmi
Machine Works (India) among others. The company's IT division was
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established in 1972 with its head office in Gurgaon and a branch in CA, USA
and four branches in Delhi, Kolkata, Mumbai, Chennai and Hyderabad. Its
service range includes Enterprise System Management Services, Customer
Support Services, Embedded System Software for Automobiles and
Embedded System Software for Wireless.
1.3 (a) Introduction of DCM Shriram Industries Ltd.
DCM Shriram Industries Ltd. (DSIL) is the flagship company of the DCM
Shriram Industrial Group based predominantly in Northern India with a
portfolio of products comprising of sugar, alcohol, fine chemicals, rayon
tyrecord & textiles. The group has a strong emphasis on technology and
quality as also a strong commitment to environmental & social concerns.
1.3 (b) Quality Policy OF DCM Shriram Industries Ltd.
DCM Shriram Group has inherited the precept of giving the customer "an extra
inch" from its founder. The group has moved away from its one-time
staple, textiles, but the precept remains. And it applies to product
specifications and quality as much as to other aspects of business.
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1.3 (c). QUALITY POLICY
1.3 (d) About DCM Shriram Industries Ltd.
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For over a hundred years, the name DCM Shriram
has been synonymous with Excellence,
Quality, Integrity, Environmental
consciousness and pioneering spirit.
This is the legacy that DCM Shriram Industries
Group - born in 1990 on restructuring of the
erstwhile DCM Ltd - aspires to live up to &
surpass.
As a business group that has inherited the rich legacy of sound governance, effective
corporate management, technological sophistication & above all the goodwill
& loyalty of numerous stakeholders & associates, we continue to build our
business on the vision & values endowed by our founder.
DCM Shriram Industries is a diversified group with operations in Sugar,
Alcohol, Organic and Inorganic Chemicals, Drug Intermediates, Rayon
Tyrecord, Shipping Containers and processed cotton yarn.
The group comprises five main business operations, each with a history of
consistent performance over the years.
Daurala Sugar Complex, comprising a cane sugar plant, distillery and an
aromatic chemicals unit.
Shriram Rayons, comprising rayon tyre cord/yarn/fabric and nylon
chafer/fabric plants.
Daurala Organics, manufacturing new generation drug intermediates.
Daurala Foods & Beverages (P) Ltd., manufacturing high-class liquors.
DCM Hyundai Ltd., manufacturing shipping containers.
As a market-driven agglomerate, responsive to customer needs, DCM Shriram
Industries group remains committed to continuous modernization, expansion,
diversification and innovation.
It is a commitment that has helped us maintain leadership in every area of our
operations.
A tradition of excellence.
5. MILESTONE
1889-
Delhi
Cloth Mills founded at Delhi
1932- Sugar factory set up at Daurala
1934- Textile Mills set up at Lyallpur (Now Faisalabad in
Pakistan)
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1940- Sugar factory set up at Mawana
1941- Heavy inorganic chemicals plant set up at Delhi
1943- Distillery set up at Daurala
1948- New textile mills set up at Delhi
1958- Spinning mills at Hissar and Silk mills set up at Delhi
1960- PVC,Chlor-alkali and Calcium Carbide plant set up at Kota
1965- Rayon tyrecord plant set up at Kota
1967- Liquor operations started at Daurala
1969- Urea plant set up at Kota
1970- Aromatic chemicals plant set up at Daurala
1972- Textile mills set up at Dasna
- Computers unit set up at Delhi
1977- Precision castings (for automobiles) foundry set up at
Ropar
1990- DCM restructured into 4 different groups
1.3 (f) Birth of DCM Shriram industries Ltd.
1994- Drug intermediates company established with works at
Daurala
(Daurala Organics Ltd.)
- Yarn dyeing and processing unit established at Alwar
(Indital Tintoria Ltd.)
1995- Shipping containers company established at Chennai
(DCM Hyundai Ltd.)
1997- Joint Venture Liquor company established with works at
Daurala
(DCM Remy Ltd.)
2004- Commercial production of Anhydrous Alcohol (for
admixing field)
2005- Daurala Organics Ltd. amalgamated with DCM
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1.4 Corporate Ethos
Enterprises of DCM SHRIRAM Group Endeavour to maintain leadership status by
observing norms of excellence in all areas.
1.5 Quality Systems
Highest degree of product specifications and quality standards is
maintained by adopting world-class quality systems. ISO
9000 series certification has been received from RWTUV
of Germany and Det Norsk Veritas of Norway.
1.5 (a) Research & Development
Research & Development is a continuous process. Focus is on
maintaining a technological edge through product
development, technology upgradation, energy
conservation, pollution control, optimisation of resources,
and conservation of environment. Close connection is
maintained with research institutions like the Shriram
Institute for Indusatrial Research (SRIFIR), Shriram Cane
Research Farm, and Shriram Test House.
1.5 (b) Environment
Manufacturing units of the Group are like garden factories.
Utmost attention is paid to treatment of effluents, control
of pollution, and conservation of environment. This
constitutes a specific target of R&D effort.
1.5 (c) Safety
Safety of men, machines & materials has a high priority. One of
the units, Shriram Rayons, has won the National Safety
Award consecutively for 15 Yrs.
1.5 (c) Human Resource
Emphasis is placed on worker-management partnership...
Achieving corporate goals through the cooperation &
dedication of all personnel... Motivating them by imparting
a sense of involvement, caring & recognition.
Human resource development, career planning & skill-up
gradation are essential parts of the Group's mgmt. process.
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1.5 (d) Quality Of Life
Helping to improve the quality of life of employees is a part of the
basic management philosophy of the Group. Facilities like
housing, education, healthcare, family welfare, libraries &
reading rooms, sports & cultural centers are common
features at all units.
1.6 Product & Unit
Manufacturing Units
Place
Daurala Sugar Works Daurala, U.P.
Products
- Sugar
-
Refined Sugar
Pharma Grade Sugar
Alcohol
Potable Liquor
Aromatic Chemicals
Shriram Rayons
Kota,
- Industrial Rayon
Rajasthan
- Nylon
.
- Chemicals
Daurala Organics
Daurala, U.P.
- Drug Intermediates
- Fine Chemicals
DCM Hyundai Ltd.
Pollivakkam,
Tamil
Nadu.
- Dry Cargo Marine Freight Containers
- Freight containers for Trucks
- Sheet metal fabrications
Daurala F & B (P)
Ltd.
Daurala, U.P.
- Scotch & Blended Whiskies
- Liqueurs
1.7 Environment, Health & Safety
DCM Shriram Industries Group has always been dedicated to meeting their responsibility
towards protection of environment and conserving scarce natural resources. This
has prompted us to adopt the following measures :

Boilers modified for multi-fuel arrangement and can be run on various renewable
fuels, viz., biogases, rice-husk and eco-friendly bio-gas (methane).

Effective flue gas wet scrubbing system using in-house technologies to release
pollution free flue gases.

ESP's
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
Bio-methanation and secondary Plant set up to obtain eco-friendly bio-gas from
distillery effluent, using in-house technologies.

Effluent Treatment Plants set up in all factories to not only control discharge of
pollutants within prescribed limit but also generates bio gas which is used as a
clean fuel in the boilers

Green Belt in and around the factory and residential complexes.

Minimizing energy and water consumption in processes.

Yearly Plantation practice

Newer technology are adopted to minimize consumption of energy and water in
the complex

Bio compost plant provides eco-friendly manure to the farmers of the area
It is our policy to maintain the wholesomeness of the environment and preserve the
ecosystem.
1.7 (a) Health & Safety
Health and safety of employees and the public is of paramount importance to us.

Shriram Rayons, has won the National Safety Award for 15 Yrs.

Organize regular training programmed covering all aspects of safety and
hazardous operations.

Assessment and elimination of potential hazards/risks to Safety, Health and the
environment, supported by regular safety audits and timely implementation and
maintenance of safety systems supported by periodic drills and rehearsals.
1.8 SOCIAL COMMITMENT
Helping to improve the quality of life of our
workers is very much a part of the
basic management philosophy at DCM
Shriram Industries.
Facilities like housing, education,
medicare, family welfare, libraries and
reading rooms, play grounds and
cultural centres for employees and their
families are provided at all our units.
Highlights
-
Workers' clubs equipped with reading
room, sports room, gymnasium etc.
to encourage social interaction.
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-
In-house facilities for regular sports and
cultural events at all units, to
encourage participation by all
employees and their families.
- Organizing free family planning & welfare
camps in rural areas in
collaboration with the local
administration on a regular basis.
-
Operating charitable hospitals for the
workmen as well as people of the
nearby villages.
- Maintaining green belts in and around
manufacturing sites.
1.9 RURAL DEVELOPMET
The company believes in sustainable development and therefore perform its role in
the development of the community in and around its units.
Various programs are regularly undertaken for improving the living conditions of the
people in the vicinity of our units
Today, the DCM Shriram name is widely associated with education, health care and
welfare activities.
DCM has build Building schools, hospitals, vocational and community centers.
Connecting villages in the sugar factory area with metal led roads and
providing other infrastructure such as street lights, solar lighting , culverts, etc.
Organizing free family welfare and health camps. Conducting immunization
drives. Popularizing and subsidizing biogas plants, smokeless chulhas and
solar cookers to meet local energy requirements and protecting the
environment. Adopting villages for community development. Providing
subsidies to farmers for purchase of agricultural input.
1.10 Shriram Rayons has the following product range.
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Rayon Products
Nylon Products
Chemical Products
RAYON PRODUCTS
PRODUCT
QUALITY
YARN
1220/1 D.TEX RAYON TYRE YARN
SUPER-II
1840/1 D.TEX RAYON TYRE YARN
SUPER-II
2440/1 D.TEX RAYON TYRE YARN
SUPER-II
1840/1 D.TEX RAYON TYRE YARN
(Yarn Package Specification)
SUPER-II
CORD :
Made from above yarn to customer specification
1220/2 D.TEX RAYON TYRE CORD
SUPER-II
1840/2 D.TEX RAYON TYRE CORD
SUPER-II
2440/2 D.TEX RAYON TYRE CORD
SUPER-II
1840/2 D.TEX RAYON TYRE CORD
(Cord Package Specification)
SUPER-II
GREIGE FABRIC :
Warp - Cord Linear Density of yarn Super-II Viscose Rayon 1220/2,
1840/2,1840/3,2440/2 and to customer specification
RAYON TYRE CORD FABRIC
(GREY)
SUPER-II
RAYON TYRE FABRIC
GREY FABRIC PACKING
SPECIFICATIONS(CONTAINERISED)
SUPER-II
RAYON TYRE FABRIC
(GREY FABRIC PACKING SPECIFICATIONS)
SUPER-II
RAYON TYRE FABRIC
DIPPED FABRIC PACKING SPECIFICATIONS
(CONTAINERISED)
SUPER-II
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SUPER-II
1840/1 D.TEX (1650/1 DENIER) DIPPED RAYON CHAFER
FABRIC
R.F.L. Treated Fabric :
We treat Greige Fabric of above Specifications or to customer requirement
NYLON PRODUCTS
Square Woven Chafer Fabric
Wicking and Non-wicking :
Multi Filament Nylon 6 or Nylon 66 in Deniers 840 and 1260. To customer
Specification. The Yarn for the chafer can also be sourced from customers
approved yarn Vendor.
940/1 D.TEX (840/1 DENIER) DIPPED NYLON CHAFER FABRIC
1400/1 D.TEX_(1260/1 DENIER) DIPPED NYLON CHAFER FABRIC
Tyre Cord Fabric
To customer specifications in 840/2, 1260/2 And 1680/2 Deniers.
2/1880 D.TEX NYLON TYRE CORD FABRIC (GREY)
2/940 D.TEX NYLON TYRE CORD FABRIC (GREY)
2/1400 D.TEX NYLON TYRE CORD FABRIC (GREY)
R.F.L.Treated fabric :
We treat Grieg Fabric of above Specifications or to customer requirement
CHEMICALS
PRODUCT
QUALITY
ANHYDROUS SODIUM SULPHATE
Coarse Grain Quality (CGQ)
ANHYDROUS SODIUM SULPHATE
Normal Quality (NQ/NQA)
CARBON-DI-SULPHIDE
As per specifications
1.11 PAST PERFORMANCE
Despite a dismal performance, DCM Shriram Industries has substantially increased its
investments in group companies. For the 18-month period ended September
1996, the company recorded an operating loss of Rs 5.68 crore compared with
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Rs 41.52 crore for the year ended March 1995. This is mainly due to the
adverse conditions in the sugar industry and rising input costs.
A sharp jump in interest burden has further affected profits at the gross level. Net loss
stood at Rs 47.53 crore against a net profit of Rs 14.86 crore as on March
1995. In fact, the net loss would have been much higher. According to the
auditor’s qualifications, capitalization of detention charges, concor charges,
etc. amounting to Rs 7.77 crore are not directly attributable to the acquisition
of fixed assets, and hence should not have been capitalized. As a result, the
loss for the year has been understated by Rs 7.77 crore. The auditors were also
unable to comment on the recoverability and consequential effect of a loan of
Rs 1.28 crore. However, the loan is considered good by the management.
Poor performance has not deterred DCM Shriram from investing in group companies.
For the 18-month period ended September 1996, investments increased from
Rs 22.17 crore to Rs 46.79 crore. It should be noted that during the same
period, the gross block increased by Rs 8.73 crore only. Investments in
subsidiary companies DCM Shriram Leasing, Indital Tintoria and DCM
Shriram International B V increased from Rs 4.31 crore to Rs 9.41 crore.
Similarly,investment in group companies increased by Rs 23 crore. In fact, the
company has invested Rs 10 crore in interest-free non-convertible debentures
(face value Rs 100) of Daurala Organics.
These debentures are to be redeemed at a premium of Rs 26 each on April 1998 (three
years from the date of allotment), with an option to the company to surrender
the debentures for redemption prior to the due date in which case no premium
would be paid. This means that the company would be getting less than nine
per cent annual yield on these loans. As if this was not enough, the company
has given an advance of Rs 6.88 crore to the subsidiaries. Advance towards
preliminary and pre-operative expenses incurred for DCM Remy was Rs 1.63
crore.
The idea of giving loans is fine as long as the company has enough funds. In fact,
DCM has increased its borrowings. As on September 1996, borrowings stood
at Rs 244.18 crore, up 59 per cent from March 1995. Higher borrowings,
which resulted in huge interest outgo, have already made a hole in DCMs
pocket. The net interest cost rose from Rs 13.11 crore to Rs 48.43 crore. DCM
has investments of Rs 3.47 crore (last year Rs 0.81 crore) in the subsidiaryIndital Tintoria (ITL). The amount due from this subsidiary is Rs 8.04 crore.
DCM has also given a guarantee to financial institutions and banks for
repayments amounting to Rs 8.79 crore. As on September 1996, ITL had an
accumulated loss of Rs 8.34 crore and a net worth of Rs 4.45 crore. Can DCM
recover the money in the near future? According to the annual report, the
management is hopeful.
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Apart from a liberal attitude towards its group concerns, DCM has also revalued its
assets. Of the total reserves of Rs 133.62 crores, revaluation reserves stands at
Rs 76.43 crore 57 per cent of the total reserves.
1.12 RECENT DEVELOPMENT
Mefcom Capital Markets, on behalf of HB Stockholdings, issued a public
announcement to the shareholders of DCM Shriram Industries.HB
Stockholdings made an open offer to the shareholders of DCM Shriram
Industries to acquire up to 3.5 million fully paid up equity shares of Rs 10
each, representing 22.88% of fully paid-up equity share capital at a price of Rs
70 a share payable in cash.
The portfolio management division has targeted to collect at least Rs 1,000 million for
management under its schemes by the end of the year 2008. The management
has set up a target to opening at least 50 branches/franchisees by March 2008
and scales it up to 100 branches by the end of the next year.
The company has already set up eight one-stop multi-brand showrooms or Hariyali
Kissan Bazars (as the company calls these stores) spread in over 8-10,000 sq ft
area each for providing all solutions to the farmer community.
The company is going ahead with the plan of taking the total number to around 100
over the next 3-4 years with an investment ranging from Rs 60-lakh to Rs one
crore each. The aim is to have multiple stores in each district within a radius of
around 25-30 Km.
The company has also entered into a strategic alliance with Bharat Petroleum
Corporation (BPCL) for setting up petrol or fuel pumps, which will be run by
it. It is working on the philosophy that if a farmer comes for farming solutions,
he needs diesel also for irrigation. The first such fuel station is expected be in
operation before the end of this month.
Yet another step forward is a tie-up with ICICI Bank Limited on loans and funding
for farmers
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CHAPTER N0-2
INTERNATIONAL
TRANSACTION
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2.1 INTERNATIONAL TRANSACTION PROCESS
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2.2 EXIM FLOW CHART
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2.3 EXPORT PROCEDURE
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In India, ships transport more than 90 per cent of the cargo. It therefore interesting to
study the export processed by ship documentation related to it.
Processing of an export order---i.
Exporter operation starts with the receipt of enquiry by the exporter from
importer. Bar on the enquiry exporter submits his offer giving complete details
of products technical specific price delivery payment terms etc.
ii.
After the process negotiations importer sends a purchase order follow by letter of
credit (if applicable).
iii.
The exporter manufactures the goods according to the specification given in
purchase order.
iv. As soon as the goods are ready the exporters invites the representative of Export
inspections agency (EIA) for pre shipment inspection and obtain the certificate
of inspection.
v.





vi.
After that, the exporter prepared following documents:----
INVOICE
PACKING LIST
ARE1 FROM EXSICE DEPARTMENT
MARINE INSURANCE POLICY
COPY OF PURCHASE ORDER / L/C
Above those documentation sends to CHA by exporter.
vii.
Based on these documents CHA agent completes the octroi formalities, obtain
port permit and prepare shipping bill which is a customs documents.
viii.
Custom department check the export cargo on the basis of information provided
on the shipping bill. If satisfy then cargo allow to loaded on the board of ship.
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ix.
The shipping line gives mate receipts to CHA agents after the payment of ocean
freights and port due obtains the bill of lading (B/L) from shipping line .B/L is
a proof of dispatch of cargo and also a negotiable document.
x.

After that, CHA agent send various documents back to exporter which is—
Customs attested invoice

Copy of shipping bill

Full set of non board bill of ladings

Copy of purchase order or L/C

Copies of ARE1 Form

SDF form
xi.

After that the exporter submitted above these documents for negotiation to the
bank which include :---Commercial invoice

Packing list

SDF form

Original copy of purchases order

Certificate of origin

Bill of exchange

Shipment advice
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After that, bank scrutinizes these documents and if found correct make payment
to exporter against documentations.
2.4 EXPORT DOCUMENTATION
INVOICE
CERTIFICATE
CUSTOMS DOCUMENT
EXPORT
DOCUMENTATION
TRANSPORT DOCUMENT
EXCHANGE CONTROL
DOCUMENT.
PAYMENT
DOCUMENT.
MISCELLANEOUS DOCUMENT
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2.5 EXPORT INVOICE
2.5 (a) ELEMENT OF EXPORT INVOICE:
Exporter

Consignee

Invoice No. and Date

Exporter Ref.

Buyer order no and date

Other reference

Buyer (other than consignee)

Country of origin of goods

Country of final destination

Terms of delivery and Payment

Pre-carriage by

Place of receipt by pre-carrier

Vessel/ Flight no.

Port of loading

Port of discharge

Final Destination

Marks and Nos. / No & Kind of pkgs.

Item code

Description of goods
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
Net weight

Gross weight

Quantity

Rate CIF EURO

Amount CIF EURO

Amount in words

Declaration:

Authorized signature
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CHAPTER-3
EXPORT BUSINESS
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3.1 TO START AN EXPORT BUSINESS
The first and foremost thing is that one has to form a Company as per the Indian
Rules and regulations. The Company can be Proprietorship, Partnership,
Co-operative society, Trust, Private limited Company or Public limited
Company. A Brief description of different set-up is as under: -
3.1 (a) PROPRIETORSHIP/SOLE TRADERSHIP:
The sole trader is a person who carries on business exclusively by and for him.
The leading feature of this kind of concern is that the individual assumes
full responsibility for all the risks connected with the conduct of the
business. He is not only the owner of capital but is usually the organizer
and manager and takes all the profits, responsibility for losses. There is no
legal formality or need for registration to commence the business provided
it is a lawful business.
3.1 (b) PARTNERSHIP FIRM:
Partnership has two or members/persons but not more than 20 and 10 in the case
of banking business. Each one has agreed to share the profit and loss of the
business in a definite proportion. The business is carried on by all or any
one of them acting for all. It is governed under the Indian Partnership Act,
1932. Partner should be a person competent to enter into a contract and
business should be legal. Partnership can be created orally or written.
Though the registration is not legally compulsory but registration can be
affected at any time by sending a statement in the prescribed form with
prescribed fee to the Registrar of Firms of the locality. Every partner is
jointly and severally liable for all acts of the firm.
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3.1 (c) JOINT HINDU FAMILY FIRMS (H.U.F):
A joint Hindu family carried on a business inherited from its ancestors. It is
governed by Hindu Law. The head of the family, the Karta, has full
authority. It does not require registration. The composition changes by
births, deaths, marriages and divorces in the family. The shares of the
members are not defined. The members are liable only to the extent of
their share in the family business but the head of family has unlimited
liability.
3.1 (d) TRUST:
The business is carried on generally for the benefit of minors, persons of unsound
mind, handicapped etc. Two trustees are appointed. Trust deed is written
and registered with the Registrar of Trust of the State.
3.1 (e) CO-OPERATIVE SOCIETY:
Minimum 7/10 persons competent to enter into a contract are required to form a
Co-operative society. It is a voluntary organization. It can be registered
with the Registrar of Co-operative societies for carrying out lawful
business. Co-operative Societies Act governs it. It is advantageous from
taxation point of view, e.g. Profit is distributed amongst members in the
predetermined ratio after transferring of 25% of profit to Reserves.
3.1 (f) PRIVATE COMPANY:
A minimum of two and maximum of 50 persons are required to form a private
company.
It may commence business on grant of certificate of
Incorporation by the Registrar of Companies on receipt of Memorandum of
Association and Article of Association (with certain prescribed restrictions)
along with prescribed fee. It needs to have two Directors. It may be
limited by shares and or by guarantee. Company has separate entity from
its members. The Companies Act, 1956, governs it.
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3.1 (g) PUBLIC COMPANY
A minimum of seven persons required forming a Public Company
After obtaining Certificate of Incorporation, it has to obtain Certificate of
Commencement of Business for commencing business. These certificates
are issued by Registrar of Companies on filling certain documents, such as
Memorandum of Association and Article of Association, Address of
Registered office, Approval for Name, Statutory declaration, along with
prescribed fee, it needs to have a minimum of three Directors. It may be
limited by shares and or by guarantee or with unlimited liability. The
Companies Act, 1956, governs it.
3.1 (h) LETTER HEAD:
Once the type of set up has been decided, the next step is to print letterhead. The
entrepreneur may entrust the job to commercial artist to design the
letterhead and logo of the company. The size of the letterhead should be
“A-4” as per international practice.
3.1 (i) RUBBERSTAMP:
As soon as the name of the company is decided, a Rubber Stamp of the company
is to be made.
3.1 (j) BANK ACCOUNT:
The Company now has to open a Current Account in any Commercial Bank.
While opening account, the entrepreneur may see the facilities, particularly
Foreign Exchange transaction facilities in the Bank. The selection of bank
is very important, particularly keeping in view of the long-term relations to
be established not only with the concerned heads of the Foreign Exchange
Department but also with the staff for getting prompt services.
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3.1 (k) PERMANENT ACCOUNT NUMBER (P.A.N)
The Company now has to apply for a permanent (Income Tax) number from the
local office or via designated agencies of Income tax department, in the
prescribed format along with necessary documents and Fee. It will help you
to forward with a smooth business without any type of taxation related
problems.
3.1 (l) IMPORTER- EXPORTER CODE NUMBER (IEC)
Every person (whether an individual or firm or company etc.) importing or
exporting goods into or from India will require a Code Number unless
specifically exempted by the Chief Controller of Imports and Exports. The
customs authority will not allow any person to import or export goods into
or from India unless such person holds a valid Importer-Exporter Code
Number. The Concerned Regional Licensing Authority, under whose
jurisdiction the applicant’s firm is located, will allot code number.
Application for allotment of IEC should be made in triplicate in the prescribed
form duly accompanied by Bank receipt/Demand draft evidencing payment
of fee along with the following documents:
A) A) Xerox of income tax PAN.
B)
B) Certificate from the banker in the form as mentioned in the IEC
application form.
3.1 (m) BUSINESS IDENTIFICATION NUMBER (BIN)
Application for allotment of BIN should be made in duplicate in the prescribed
form duly to the Concerned Regional Licensing Authority, under whose
jurisdiction the applicant’s firm is located or also can made the application
online directly through the website DGFT to have BIN.
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3.1 (n) S.S.I REGISTRATION (TINY UNIT)
All exporters engaged in manufacturing process and whose investment in plant
and machinery is less than five lakhs can file an application for Registration
as a Small Scale Industrial unit. The SSI unit registration benefits you in
many kinds in your future business. It attracts levies and priority in bank
loan interest/electricity rates etc.
3.1 (o) SALES TAX
For producing export goods, manufacturers exporters/traders, should get
themselves registered with the Local Sales Tax Department of the
State/Union Territory where they are located.
3.1 (p) CENTRAL EXCISE (RBA)
All manufacturer-exporters and merchant-exporters engaged in exporting
excisable goods under “bond” are required to open and maintain a Running
Bond Account (RBA) with the Maritime Collector of Central Excise.
However, SSI units whose clearances don’t exceed Rs.25 lakhs
consequently are exempt from excise duty.
3.1 (q) REGISTRATION WITH EXPORT PROMOTION COUNCILS
The general policy in respect of the role and functions of the Export promotion
Councils is given separately.
An exporter may obtain Registration-Cum-Membership Certificate (RCMC) from
any one-export promotion council (EPC) relating to his main line of
business. However, if the export product is such that it is not covered by
any
EPC, the Regional Licensing Authority concerned thereof may issue RCMC in
respect. The Federation of Indian Export Organization (FIEO) shall issue
the RCMC.
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The Chief Controller of Imports and Exports may, on his own motion or otherwise,
direct an EPC or FIEO to register or de-register an exporter of otherwise
issue such other direction to them consistent with and in order to implement
the provisions of the Act, the rules and orders made in the Import and
Export Policy of Ministry of Commerce, Government of India .
3.1(r) CLEARING AND FORWARDING AGENT (C&F/C.H.A)
Clearing and forwarding agents offer a host of services like preparation of
shipping bill, getting the documents authenticated at customs after getting
the consignments checked by customs officers. Some other services them
are as under: a) Door to door services
b) Warehousing facilities
c) Regular air consolidation services in India
d) Booking of shipping space
e) Arrangements for insurance policies
f) Arrangements for shipping on board
g) Handling of exhibition goods, its clearance & display at pavilion.
h) Preparation and processing of all kinds of shipping documents
i) Efficient shipment tracking systems like availing of Flight details with
routes and date etc.
Now the exporters have to take special attention to submit the necessary post
shipment documents with his bank and concerned customs/ licensing
authority for getting Licenses/drawback claims if any.
3.1(s) THE SEQUENTIAL STEPS TOWARDS EXPORT OPERATIONS
1.
Preliminary Stage: Procurement of all kinds of registration as mentioned
above.
2. Procurement of an export order and its processing: a) Terms & conditions of Contract
b) Mode of payment
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c) Confirmation of the order by exporter.
3. Procurement/Manufacture of goods, as per the specification of the importer,
by securing Pre-shipment finance from your bank on the basis of security
of L/C or Confirmed Export Order or Personal bond along with ECGC
policy.
4. Clearance of Excise Authorities, from the premise of the exporter after
physical verification:
a)
On payment of duty and subsequent rebate or
b)
Clearance under bond.
5. To fulfill the requirement of quality control and pre-shipment Inspection.
6. Dispatch of goods to the gateway port for shipment by road or Rail and
requisite application to be made to the insurance company for obtaining insurance
cover for various risks.
7. Completion of formalities relevant to MEP or floor price regulation,
canalization, certificate of origin, ECGC cover, consular invoice, export license
etc. wherever required.
8. Forwarding of shipment documents to C&F /CHA agent, along with requisite
instructions including booking of space with sea-carrier whose sailing
schedule and ports of call suits the exporter’s delivery commitment. The
documents required by C&F agent for processing prior to shipment are: -
a)
Commercial invoice.
b)
Original export order.
c)
Original copy of L/C.
d)
Original G.R form /SDF (It is now waived off by
R.B.I for shipments values less than US$ 25000).
e)
Original AR-4A/AR-4 form with duplicate copies.
f)
Original excise gate pass.
g)
Packing and weight lists.
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h)
Certification of inspection.
i)
Declaration form in triplicate.
j)
Consular invoice where necessary.
k)
Export license where necessary.
l)
Endorsement regarding floor price, canalization etc. where
necessary.
m)
Purchase Memo on demand where necessary.
n)
Railway or Lorry receipt.
o)
Certificates of origin.
9. The C&F agent takes delivery of the goods from the rail or road carrier and
arranges for storage in a warehouse, till carting order is received from port
authorities. In the meantime prepares the shipping bill with requisite
details for customs clearance. Shipping bill along with other documents
mentioned above is submitted to the export department of the Customs
House, for examination.
10.
On clearance of the shipping bill by the Customs Authorities, the C&F agent
presents the port trust a copy of the shipping bill to Shed Superintendent of
the port authorities and obtains Carting order for bringing the export
consignment in the transit shed for physical examination. Thereafter Dock
Challan with requisite details along with assessment of Dock charges
payable is prepared.
11.
Dock Challan and the Shipping Bill are forwarded to the preventive officer
for physical examination of the goods and “Let Ship/Let Export”
endorsement.
12.
The Stevedore and issue of Mate Receipt by the Master or the Mate of the
ship bring the cargo alongside the vessel with the help of port labour for
loading on the ship.
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13.
On payment of port charges, C&F agent obtains the Mate Receipt from the
port authorities. It is then presented to the Customs Preventive Officer for
certifying the fact of shipment on all copies of Shipping Bill. AR-4A/AR-4
form and other
Documents requiring post-shipment endorsement from the Preventive
Officer.
14.
The Mate Receipt is presented usually to the Agent of the shipping company
for obtaining requisite number of originals and copies of the Bill of Lading.
15.
16.
The C&F agent then forwards to the exporter the following documents: 1.
Full set of Bill of lading.
2.
Export Promotion copy of the shipping bill.
3.
Copies of customs invoice.
4.
Duplicate copy of AR-4A/AR-4 form.
5.
Duplicate copy of GR /SDF form (where necessary).
6.
Copies of commercial invoice duly attested by customs.
7.
Original export order.
8.
Original L/C.
On receipt of these documents, the exporter sends to the importer the
shipment advice and forwards the following documents: 1
Non-negotiable copy of the Bill of Lading.
2
Customs invoice.
3
Commercial invoice.
4
Packing list.
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17. He also files a claim with the Maritime collector of Central excise in the port
town for rebate of central excise duty or for getting credit in the bond
account.
18. The exporter secures payment for the value of the export consignment on
presentation and processing of the following documents to the negotiating
bank.
1. Duplicate copy G.R/SDF form.
2. Bill of exchange, first and second exchange.
3. Full set of Bill of Lading (clean on board), all negotiable copies and one
non-negotiable copy.
4. Original copy of L/C.
5. Two copies of commercial invoice.
6. Two copies of customs invoice, if necessary.
7. Two copies of Certificates of Origin.
8. Two copies of packing list.
9. Two copies of Marine Insurance Policy.
10. Four copies of bank certificate.
11. Additional copies of commercial invoice to be certified by the bank and
returned to the exporter.
12. Consular invoice, where necessary.
19. The negotiating bank transmits/sent the following documents to the banker of
the importer by first air mail/express courier followed by a second set of
these documents by the second air mail/courier to ensure receipt of at least
one set, if the other is lost in transit or delayed. (Now a day Messages
through SWIFT are authorized).
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1. Bill of exchange.
2. Negotiable Bill of Lading.
3. Commercial Invoice.
4. Customs Invoice.
5. Insurance Policy.
6. Certificate of Origin.
7. Consular invoice, Export certificate. Where necessary.
8. Packing list.
20. The negotiating bank transmits/send the duplicate copy of
GR/SDF form to the Exchange Control Department of R.B.I. The original copy of
bank certificate, along with attested copies of commercial invoice are
returned to the exporter, and the duplicate copy of the bank certificate is
forwarded to the Jt. DGFT, Import & Exports of the area on repatriation/
receipt of the bill payment.
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CHAPTER-4
EXPORT DOCUMENTATION
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4.1 EXPORT DOCUMENTATION
An export trade transaction distinguishes itself from a domestic
Trade transaction in more than one-way. One of the significant variations between
the two arises on account of the much heavier documentation work which
is characteristic of an export transaction. Some of the documents are a
must in export business, arising as they do on account of “custom of trade”
and conventions governing international commercial practices. Besides,
quite few of these owe their existence to certain statutes; rules and
regulations governing export trade, which inter alias, include export trade
control, foreign exchange regulations, pre shipment inspection, central
excise and customs.
The documentation and procedures are rendered complex on account of the
inevitable involvement of a number of intermediary agencies and
government authorities such as freight forwarders, carriers, insurance
companies, banks, export promotion councils, Inspection agencies, R.B.I
etc. In order to simplify the documentation procedure, a new Aligned
Documentation has been developed.
4.2 ALLIGNED DOCUMENTATION SYSTEM (ADS)
Based on UN layout key and the experience gained in many other developed
countries, the government of India has decided to introduce the ADS with
effect from 1st October-1991. This system involves the preparation of
documents on a uniform and standard A4 size of paper.
The documents are aligned to one another in such a way that the common items of
information are given the same relative slots in each of the documents
included in the system. This makes it possible to prepare one “Master
Document” embodying the information common to all the documents
included in the aligned series and to run off all the aligned documents from
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the same Master Document with the help of suitable masking and
reproduction techniques. The use of masks is intended to blank out such
information as is not required in a particular document.
4.3 Standardized and aligned pre-shipment export documents
On an average, about 24 commercial and regulatory documents are associated with
an export transaction in India . They include 15 important commercial
documents and are discussed as under:
a. Performa Invoice
b. Commercial Invoice
c. Packing list
d. Shipping instructions
e. Certification of Inspection/Quality Control
f. Insurance declaration
g. Certificate of insurance
h. Shipping order
i. Mate receipt
j. B/L/ Combined Transport Document
k. Application for certificate of origin
l. Certificate of origin
m. Bill of exchange
n. Shipment advice
o. Letter to the bank for collection/negotiation.
The commercial documents are those which, by custom or trade are required for
effecting physical transfer of goods and their “title’ from the exporter to the
importer and the realization of export sale proceeds.
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4.4 Regulatory Documents
Regulatory Pre-shipment export documents are those, which have been prescribed
by different agencies in compliance of the requirements of various rules,
and regulations under relevant laws governing export trade such as export
inspection, forex, customs etc…. On an average there are 9 regulatory
documents.
a. Gate pass-1/gate pass-2 prescribed by: Central excise Dept.
b. AR4-A/AR-4 form -doc. Shipping bill/for export
Customs dept.
For export of goods ex bond -doFor export of duty free goods -doFor export of dutiable goods -doFor export of goods under claim for -doDuty drawback
d. Export application/Dock Challan
Port trust
Port trust copy of shipping bill
e. Receipt for payment of
Port charges -dof. Vehicle ticket-dog. GR/PP/SDF forms R.B.I
h. Freight payment certificate
i. Insurance premium payment
4.5 DOCUMENT CONNECTED WITH TRANSPORTATION OF GOODS.
4.5 (a) Air Way Bill (AWB) Air consignment Note.
The receipt issued by an airline or its agent for the carriage of goods is called
airway bill or air consignment note. It is issued in terms and conditions of
the contract of carriage of goods. It is not a document of title and it is not
issued in a negotiable form.
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Generally AWB is issued in three copies, viz; for the carrier, for the consignee and
for the consignor.
4.5 (b) Postal Parcel Receipt (PPR).
Like the AWB, the PPR evidence merely the receipt of the goods to be exported to
the buyer and is not a document of title.
4.5 (c) Bill of Lading (B/L).
A Bill of Lading is the most important document in Foreign Trade. It is generally
issued by a shipping company. It services as a receipt from the shipping
company who undertakes to deliver the goods at agreed destination on
payment of freight in a prearranged manner and also a document of title to
the goods. B/L is generally made out in the sets of two or three originals.
All the originals are duly signed by the master of ship or the agent of the
steamship company and all the originals are equally valid for taking the
delivery of goods and once one original copy is utilized the other originals
become full and void.
B/L is nor a negotiable instrument in terms of Negotiable instrument Act,
However, it is a practice to call the original copies as negotiable copies.
4.5 (d) Combined Transport Document (CTD)
With the introduction of multimode movement of goods in container on the basis
of single contract from and to interior of the country, government has
established Inland Container Depot (ICDs) at selected center. These dry
depots have made it possible to cover the entire movement of goods, from
ICD to destination, under one transport document called CTD. Rules
governing combined transport document are designed by International
Chamber of Commerce (Brochure No.298) considering the international
practices.
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4.6 COMMERCIAL DOCUMENTS.
4.6 (a) Performa Invoice
As the name denotes, it is an invoice in established Performa, payment of which is
not intended. These invoices are used for obtaining financial assistance
like Packing Credit from a banking institution, as Performa invoice
together with an offer, acceptance on which will form a legal contract.
4.6 (b) Commercial Invoice
It is the most widely used invoice in commercial transactions. It is the statement
of account of sale rendered by the seller to the buyer and is prepared on
seller’s letterhead or in the prescribed form on A-4 size paper. It contains
the name of the buyer and his address, date, reference number, quantity,
marks description of goods unit price, total value of goods, terms of
payment/C & B/L no. Etc.
4.6 (c) Consular Invoice
A consular invoice is required by some countries like Canada, USA, etc…a consul
for invoice is required to be prepared in a prescribed format and it should
be signed/certified by the consul of the importing country located in the
country of export. The main purpose of a consular invoice is to enable the
importer’s country to collect accurate and authenticated information about
the value, volume, quality, source etc; of the import for assessing import
duties and for other statistics purposes.
4.6 (d) Customs Invoice
Countries like USA, Canada etc. need custom’s invoice. It is generally made out
on a special form prescribed by the custom authorities of the importing
country and helps for allowing entry of goods in the importing country at
preferential tariff rates. The invoice forms are generally available at the
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consular office of the importing country and are required to be signed and
with ensued after duly filling the same.
4.6 (e) Legalized/ Visited Invoice
These are the invoices sworn for their genuineness by the seller as being correct
before the appropriate consulate/chamber of commerce/embassy as the case
may be and they bear the stamp and authentication of the consulate/chapter
of commerce/embassy as being in order. They collect a nominal charge
from the seller for doing this.
4.7 INSURANCE DOCUMENTS
4.7 (a) Letter of insurance.
This is analogous to cover note issued by the broker. It is stated that particular
subject are placed under insurance and certificate/policy of insurance will
be issued later on.
4.7 (b) Broker’s Certificate
This is also not acceptable as broker issues the same, as broker acts for the insured
and cannot compel insurer to accept the proposal of insurance.
4.7 (c) Insurance Certificates.
The insurance on “open cover” or “floating” policy covering all shipment on
certain terms and subjects to conditions laid down. Unless the insurance
certificate gives details of the conditions of cover it is not so much value to
third party who negotiate the shipping documents.
4.7 (d) Insurance Policy.
This is a basic legal document-evidencing contract of insurance between the
insurer and insured. It gives full details of all the risks covered. Marine or
transit insurance policies can be assigned by the insured merely by
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endorsement and delivery. Insurance policies are issued in different forms
like floating policy, open policy or cover, specific policy etc…
A floating policy is a contract of insurance for covering a number of shipments, the
details of which are not finalized when the contract of insurance is
conclude. The relevant details like name of the vessel, destination,
description of cargo etc. is therefore required to be declared subsequently
and endorse in the policy.
An open cover /policy is valid for a given period of time or permanently open. As
per this policy the insurer undertakes to insure all the shipments for which
the details are already intimated to the insurer.
A specific policy covers specific shipments and such policy is readily available for
submitting with the export documents.
The coverage of risks is classified into categories like A, B, C etc. and the
insurance policies are issued accordingly.
4.8 FINANCIAL DOCUMENTS
4.8 (a) Draft
It is bill of exchange. According to section 5 of the Negotiable Instruments Act,
1881 a bill of exchange is “an instrument in writing containing an
unconditional order, signed by the maker, directing a certain person to pay
a certain sum of money only on or to the order of a person to the bearer of
the instrument.”
A bill of exchange contains an order from the Creditor to the debtor to pay a
specific amount to a person mentioned therein. The make of the bill is
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called the “drawer” the person who is directed to pay is called the
“drawer”. The person who is entitled to receive payment is called “payee”.
In an export transaction it is advisable that an exporter draws a draft, which may
either “at sight/on demand”. Drafts are mainly make in two sets with all
other concerned documents and mailed to the foreign correspondent
through an authorized dealer for presentation to the drawer/importer, When
any of the drafts is paid on presentation it is called an “at sight/on demand
draft and if accepted when it is a usance draft by the drawer, then the
second draft becomes null and void.
4.8 (b) Clean Bill and Documentary Bill
When the drawer of a bill encloses with it a document of title to goods or any
other equivalent document it is called a documentary bill. In an export
transaction the exporter delivers to the banker, documents like full set of
B/L, AWB, PPR etc… together with documents like drafts, invoices,
packing list etc… for presentment to the drawer. Depending upon the
tender of the bill i.e. D/P or D/A, the documents are delivered to the drawer
against payment or acceptance. If no such documents are attached with the
bill, then it is called as a clean bill.
4.8 (c) Stamp Duty
All drafts are drawn on the drawer. Unlike in most of the foreign countries, the
Indian stamp Act does not required the sight drafts to be “stamped”. I.e. no
stamp duty is applicable to drafts drawn at sight/demand bills. Drafts
drawn on usance basis require to be adequately stamped. Stamp duty is the
same no matter whether the bills is drawn or negotiated in India .
4.8 (d) Acceptance of Bill
A bill of exchange payable on demand or at sight or on a fixed date does not need
acceptance and hence presentment for acceptance is unnecessary unless
such presentation is specifically desired. A draft payable after sight must
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be presented for acceptance since the maturity date of the bill can only be
determined after such acceptance.
When the drawer of a bill signified his consent to the drawer’s order in the bill of
writing his name across the face of the bill with or without the word
“accepted” the bill is said to be accepted. Acceptance of a bill, therefore,
Means that the drawer gives his consent to pay the amount mentioned therein on
the due date/maturity date. The foreign correspondent bank usually advises
the due date to the exporter through his banker in India .
4.8 (e) Noting/Protesting of Foreign Bills
At the time the bills are forwarded to the exporter’s bank, it is advisable to provide
the bank with clear instructions/steps to be taken in case the bills are
dishonored on presentation or maturity as the case may be.
The
drawer/holder for value may cause the dishonor to be noted by a Notary
Public on the instrument or upon a paper attached thereto or partly upon
each. The notary formally makes a demand of acceptance or payment upon
the acceptor or drawer and on his refusal to do so notes the same on the
bill. Thus “Noting” means the fact that the bill has been dishonored is
recorded on it and puts the drawer/holder for value on a higher pedestal in
the eyes of law. This is done within a reasonable time after dishonor.
Usually the notary makes the following observations: -
a. The date of dishonor.
b. The reason, if any assigned for such dishonor.
c. The Notary ’s charges.
The foreign bills must, thereafter Protested for dishonor, for it is to be placed as
documentary evidence in the court of law. In other words the observations
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made thereon by the notary will be taken at face value. A protest is a
certificate issued by the Notary Public attesting that the bill has been
dishonored and will usually contain: -
a. The name of the person for whom and against whom the instrument has
been protested.
b. A statement that the Notary Public and the reason for dishonor
demanded acceptance or payment from the acceptor or drawee.
c. The place and time of dishonor of the bill
d. The signature of the Notary Public.
4.9 THIRD PARTY DOCUMENTS
4.9 (a) Certificate of Origin
Generally the importer to furnish to him a certificate stating that the goods are of
his country’s origin will call upon an exporter. Independent bodies like, the
Chamber of Commerce, Handicrafts Board, Export inspection Council etc,
will give this certificate… Who Issue them against payment or nominal
fees after being satisfied of the origin of goods. There may be a
preferential tariff in favour of goods from particular countries and
therefore, it has to be ensured that the exporter who has brought them into
his own country from some other place of origin has not reshipped the
goods; which is not eligible for the preference.
4.9 (b) Black List Certificate
This is to certify that the ship/aircraft carrying the goods has not touched a
particular country on its journey or that the goods are not of a particular
country. This certificate is usually called where countries have strained
political relations with another.
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4.9 (c) Packing List
This document showing details of goods contained in each parcel/shipment. It
shows item-by-item the contents of the containers or parcels shipped to
enable the buyer/receiver of the shipment to check the shipment.
4.9 (d) Manufacturer’s/Supplier’s quality/Inspection Certificate
This is a certificate to the effect that the goods, which have been manufactured
supplied are as per the requirement of the contract of sale.
4.9 (e) Certificate of Inspection
Inspection certificate, indicating that goods have been inspected before some
countries need under some contracts or shipment. This certificate is
generally required to be issued by one of the authorized independent
Inspection Agencies like Export Inspection Agency, Textile Committee,
and Central Silk Board etc.
4.9 (f) Certificate of Analysis
Certificate regarding the chemical analysis of the goods issued by a competent
office. Certificate of shipping agent that a certain lot of goods have been
shipped.
4.9 (g) Health/Veterinary/Sanitary Certificate
When the goods imported are foodstuffs, marine products, livestock etc. a
certificate from the health/veterinary/sanitary/authorities is called for. This
is because the importer desires to know if the goods are fit for human
consumption.
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CHAPTER N0-5
INDIAN TEXTILE
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5.1 INTRODUCTION
Textile is the core business of India from the ling time. It is major business for our
short term and cottage industries. Indian textile industry is as old as the word
textile itself. This industry holds a significant position in India by providing
the most basic need of Indians. Starting from the procurement of raw materials
to the final production stage of the actual textile, the Indian textile industry
works on an independent basis.
5.2 HISTORY OF INDIAN TEXTILE INDUSTRY
India has a diverse and rich textile tradition. It is the second largest producer of
textile and clothing in the world with its products being exported to over 120
countries. Recent estimates indicate that the country's textile sector will grow
faster in the coming years and contribute a lot to the our overall economy.
There are different time per time revolution has been taken place in the Indian
textile industry.
The textile sector has been thriving in India for decades. The traditional textile
industry of India had virtually decayed during the colonial regime. However,
in the nineteenth century, the industry was revived with the establishment of
textile mills in Calcutta (now Kolkata) in 1818. Cotton textile industry had
begun functioning in Bombay (now Mumbai) in 1850s and the first cotton
textile mill in the city was established in 1854 by a Parsi cotton merchant.
These growth expectations run contrary to the perceived vied, a decade back
or so, that textile was a sunset industry. Till 1985, India has no specialized
policies to promote the textile industry. It is 1985 that the government
announced a separate policy statement with regard to development of textile
sector. In the year 2000, National Textile Policy was announced and since then
the Indian textile industry has been exhibiting a distinguished performance
opening up new opportunities for the small and medium scale industries
(SMEs) in the country.
Parallel to these developments the Indian textile industry has witnessed over the last
few years, textile exports of the country have also grown exponentially despite stiff
competition from Asian rivals like Vietnam, China, Pakistan and Indonesia. During
2006-07, India's textile exports were valued at $18.73 billion (Rs 84,752 crore) and
they are estimated to be at $22 billion in the year to March 2009.
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5.3 LITERATURE REVIEW
The study has been take into implementation of the different research surveys of
many famous national and national researchers. ASSOCHAM’ study on textile
in India, AC Nielsen’s surveys are the major ones which takes into
implementation and there suggestions has been deeply implemented.
According to the report given by ASSOCHAM, the textile sector registered 50
per cent increase in investment during 2008-09 to US$ 10.46 billion from US$
6.57 billion in 2007-08. The textile industry has attracted foreign direct
investment (FDI) worth US$ 677 million from April 2000 to March 2009.
According to the Textiles and Apparel Report 2007, by the Confederation of
Indian Industry and Ernst & Young, the Indian sourcing market is estimated to
grow at an annual average rate of 12 per cent from an expected market size of
US$ 22 billion-US$ 25 billion in 2008 to US$ 35 billion-US$ 37 billion by
2011.Simultaneously, world's cutting edge fashion brands such as Hugo Boss,
Diesel and Liz Claiborne are stepping up their sourcing from India.
According to the ICRA Information, Grading and Research Service, India’s textile
and apparel exports to US during January-April 2005 have37%grown by 27
per cent as compared to the corresponding period in the previous year.
However this has been at a slower rate as compared to China (59 per cent)
during the same period. Indian needs to shift its focus to exports of textile and
clothing based on manmade fibers, which accounted a meager 16 per cent of
the total textiles and apparel exports in 2004, while 37 percent of US textile
and apparel imports constituted imports of manmade fiber in 2004. Thus, it is
necessary to leverage our cost advantage in terms of labor costs to boost
overall textiles and apparel sector in the future.
5.4 OVERVIEW OF INDIAN TEXTILE INDUSTRY
Indian textile industry is the country’s leading profit gainer industry. It is a very old
and traditional business of India. This industry holds a significant position in India by
providing the most basic need of Indians. Starting from the procurement of raw
materials to the final production stage of the actual textile, the Indian textile industry
works on an independent basis. Until the economic liberalization of Indian economy,
the Indian Textile Industry was predominantly unorganized industry. The opening up
of Indian economy post 1990s led to a stupendous growth of this industry.
Indian Textile Industry is one of the largest textile industries in the world. Today,
Indian economy is largely dependent on textile manufacturing and exports.
India earns around 27% of the foreign exchange from exports of textiles.
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Further, Indian Textile Industry contributes about 14% of the total industrial
production of India. Furthermore, its contribution to the gross domestic
product of India is around 3% and the numbers are steadily increasing. Indian
Textile Industry involves around 35 million workers directly and it accounts
for 21% of the total employment generated in the economy. Indian textile
industry concludes of various segments like:
a. Woolen Textile
b. Cotton Textiles
c. Silk Textiles
d. Readymade Garments
e. Jute And Coir
f. Hand-Crafted Textile Like Carpets
g. Man Made Textiles Indian textile industry in a very short span had made a distinct
position globally, alluring the globe towards the ‘World of Indian textiles’.
This has happened mainly because:
h. High availability of raw materials
i. Highly skilled economical labor, an added advantage
j. Largest producer of cotton yarn contributing 25% towards worlds cotton
k. Availability of all kinds of fibers like silk, cotton, wool and even high quality
synthetic fibers
l. Flexibility of the readymade garment industry in terms of sizes, fabric variety,
quantity, quality and cost
It’s not just the present that is shinning like a bright start but also the future, as the
textile export market of India is expected to reach a high of $50 billion by
2010. This will eventually make a profit by 300%. In order to attain this target
Indian textile industry has already started improving their design skills,
including a combination of various fibers. Indian textile industry is all set to
meet international standards and is planning to invest $5 billion in machineries
very soon.
Most of the international brands like Marks & Spencer, JC penny, Gap have started
procuring most of their fabrics from India. In fact, Walmart, who had procured
textile worth $ 200 million last year, intends to procure $ 3 billion worth of
textile this year.
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The golden phase of the Indian textile industry has just begun where the world is
chasing it from all nooks and corners.
5.4(a) MAJOR TEXTILE COMPANIES OF INDIA
The major textile companies of India are as follows :•Arvind Mills: - Arvind Mills is India’s largest Textile Mill. It has large production in
denim, shirting and knitted garments. It is now adding value by manufacturing
denim apparel. Its sales are around US$ 300millions.
•Raymond’s:- it is a brand name of Textiles all over the world. It specialized in the
diversified woolen garments. It is expanding its products through the
organized retail stores and showrooms. It also looking to also expanding
denim capacity and to become second largest denim player in India. Its
presence in retail will be big positive in future. Its annual sales are around US$
300 millions
•Reliance Textiles:-Reliance Textiles is one of the major Textile Company that is in
business of fully integrated manmade fiber. It has capacity of more than 6
million tones per year. It has joint venture partners like, DuPont, Stone &
Wsebster, Sinco (Italy) etc. Vardhaman SpinningVardhman deals in spinning,
weaving and processing segment of the industry. It is planning to double its
fabric processing capacity to 50 million meters. It is an approved supplier to
global retailers like GaP, Target and Tommy Hilfiger. Its sales are little over
Textiles (Composite mill, cotton & Man-
Mills (Fully
-
producer with spinning
chemicals
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Birla VXL Ltd. (F
-made Fiber)
e industry has
several segments such as hosiery and ready-made garments and is divided into
the organised and the un-organised sector, with players from both sectors often
grouped together in export oriented clusters. Some of the important textile
clusters are based in places such as Bhilwara, Sanganer, Panipat, Palli, Jetpur,
Jodhpur, Surat, Sambhalpur, Mysore and Bhiwandi.
5.5 THE TOTAL PRODUCTION OF YARN IN INDIA
Quantity
4500
4000
3500
3000
2500
2000
1500
1000
500
0
Quantity
The production of yarn shows a increasing trend from last decade. In the year 2003-04
the total production of yarn in India was 2900 million kg. Which has been
continuously increasing to 3100(2004-05), 3300, 3600, 3800 and 4200 million
kg?
EXPORTS
The Indian textile industry is estimated to be around US$ 52 billion and is likely
to reach US$ 115 billion by 2012. The domestic market is likely to increase
from US$ 34.6 billion to US$ 60 billion by 2012. It is expected that India's
share of exports to the world would also increase from the current 4 per cent to
around 7 per cent during this period. India's textile exports have shot up from
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US$ 18.71 billion in 2006–07 to US$ 20.25 billion in 2007–08, registering a
growth of over 8 per cent.
5.6 India’s textile export (US $ MILLION)
Quanity
4500
4000
3500
3000
2500
2000
1500
1000
500
0
Quanity
Some Facts
• India is the largest exporter of yarn in the international market and has a share of 25
per cent in world cotton yarn exports.
• India accounts for 12 per cent of the world's production of textile fibers and yarn.
• In terms of spindle age, the Indian textile industry is ranked second, after China, and
accounts for 23 per cent of the world's spindle capacity.
• The country has the highest loom capacity, including handlooms, with a share of 61
per cent in world loom age.
• India is the largest producer of jute in the world.
• It is the second largest producer of silk and the only country to produce all four
varieties of silk –mulberry, tusar,eri and muga.
• India is the fifth largest producer of synthetic fibers/yarn. Indian textiles, handlooms
and handicrafts are exported to more than a 100 countries, Europe continues to
be India's major export market with 22 per cent share in textiles and 43 per
cent in apparel, the US is the single largest buyer of Indian textiles and apparel
with 19 per cent and 32.6 per cent share, respectively. Other significant
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countries in the export list include the UAE, Saudi Arabia, Canada,
Bangladesh, China, Turkey and Japan. Readymade garments (RMG) are the
largest export segment, accounting for almost 45 per cent of total textile
exports and 8.2 per cent of India's total exports. This segment has benefitted
significantly with the termination of the Multi-Fibre Arrangement (MFA) in
January 2005. RMG exports from India were worth US$ 8.51 billion in FY
2008. They are expected to touch US$ 14.5 billion by 2009–10 with a
cumulative annual growth of 18 to 20 per cent, according to the Apparel
Export Promotion Council. Another segment in which India has excelled in
the export market is carpets. Exports of carpets have increased from US$
654.32 million in 2004–05 to US$ 806.71 million in 2007–08. Significantly,
apparel is the second largest retail category in India. It accounts for about 10
per cent of the US$ 37 billion Indian retail market, and with the continuing
boom in consumer demand is estimated to grow at the rate of 12–15 per cent
annually. In fact, reflecting the huge opportunity in this segment, AT
Kearney's 'Retail Apparel Index' ranks India as the third most attractive market
destinations for apparel retailers.
5.7 MAJOR TEXTILE EXPORT PROMOTION COUNCILS OF INDIA
The major export promotion councils of India are given as follows :-a) Apparel
Export Promotion Council b) Cotton Textile Export Promotion Council c)
Handloom Export Promotion Council d) Indian Silk Export Promotion
Council e) Apparel Export Promotion Council :- APEC is a nodal agency
sponsored by the ministry of Textile, Govt. of India. It performs the following
functions:•Monitors garment exports quotas and promotions of exports of readymade garments
of India.
•Continuously involves in the task of promoting exports by organizing buyer-seller
meets,
•Leads trade delegations to potential markets globally.
•Participates in specialized international fairs.
•Organized the Indian International Garment Fair biannually. Cotton Textile Export
Promotion Council: - Cotton Textile Export Promotion council is an
autonomous, non-profit export promotion body. Its activities includes
•Acting as an international face of Indian Textile Exports.
•Collection and dissemination of information. Handloom Export Promotion Council :It is a statutory body. It’s function is to promote the exports of all handloom
products like fabrics, home furnishings, carpets and floor covering etc.Indian
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Silk Export Promotion Council :- It is the nodal agency for promotion of silk
exports from India. Consist of more than 1200 silk exporters as members
5.8 INDIAN TEXTILE POLICY 2000
Highlights of the National Textile Policy 2000. The Government of India recently
announced the new National Textile Policy (NTP) 2000, with the objective of
facilitating the industry to attain and sustain a pre-eminent global standing in
the manufacture and export of clothing. In furtherance of these objectives, the
strategic thrust is to be placed on technological up gradation, enhancement of
productivity and quality, product diversification, and strengthening the raw
material base in the country.
Through NTP 2000, the Government would endeavor to achieve the target of textile
and apparel exports from the present level of U.S. $11 billion to U.S. $50
billion by 2010. Of this, the share of garments would be U.S. $25 billion’s The
policy provides for setting up a venture capital fund for tapping knowledgebased entrepreneurs and assisting the private sector to set up specialized
financial arrangements to fund the diverse needs of the textile industry. The
new policy would also encourage the private sector to set up world class,
environment-friendly, integrated textile complexes and textile processing units
in different parts of the country and would review and revitalize the working
of the TRAs (Textile Research Associations) to focus research on industry
needs. Sect oral Initiatives Within the framework of the new Policy, the
following sector specific initiatives will be taken: RAW MATERIALS The
thrust will be on improving the availability, productivity and quality of raw
materials at reasonable prices for the industry. Though cotton is expected to
continue to be the dominant fiber, special attention will be given to bring the
balance between cotton and non-cotton fibers closer to international levels.
Cotton. The primary aim of the policy for this segment will be to improve
production, productivity and quality, and stabilize prices. The Technology
Mission on Cotton will be the instrument for achieving these parameters.
Ministry of Textiles, Ministry of Agriculture, Cotton growing States, farmers
and industry associations will be actively involved in the implementation of
this Mission.
Silk Focus will be on achieving international standards in all varieties of silk. Steps
will include:
• Improving Research & Development and effective transfer of technology at all
stages.
• Increasing the production of non-mulberry varieties of silk.
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• Encouraging clustering of activities of reeling and weaving and strengthening
linkages between producers and industry.
• Reviewing the import policy periodically for raw silk, taking into account the
balanced interests of the Seri culturists as well as the export manufacturer’s. Ê
Wool In order to augment availability of quality wool, the following measures
will be initiated:
• Take up collaborative research projects with the leading wool producing countries of
the world.
• Encourage private breeding farms to increase productivity.
• Promote private sector linkages for marketing of wool.
• Take up an integrated development program for angora wool. Jute A Technology
Mission on Jute will be launched to achieve the following objectives:
• Develop high yielding seeds to improve productivity and acceptability in markets.•
Improve retting practices to get better quality fiber.
• Transfer cost effective technologies to the farmers and create strong market
linkages. Clothing the role of this sector is poised for radical change in view of
the transformation in the international trading environment brought about by
the rules and regulations of the WTO. The industry will be restructured as
follows:
• Garment industry will be taken out of the SSI reservation list.
• Joint ventures and strategic alliances with leading world manufacturers will be
promoted.
• Schemes with necessary infrastructural facilities for the establishment of
textile/apparel parks will be designed with the active involvement of state
governments, financial institutions and the private sector. Jute Industry In the
jute sector, attempts would be made to revive the jute economy through
supportive measures covering research and development, technology up
gradation, creation of infrastructure for storage and marketing of raw jute, and
product and market development activities for jute and diversified jute
products. Spinning Sector the NTP seeks to continue efforts to modernize and
upgrade technology to international levels, and proposes to take the following
steps, in cotton spinning as well as in the worsted woolen sectors:
• Encourage the spinning sector to continue to modernize.
• Liberalize and encourage export of cotton yarn. Organized Mill Industry Efforts will
be made to restore the organized mill industry to its position of pre-eminence
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to meet international demand for high value and large volume products. For
this purpose, the following measures will be initiated
• Integration of production efforts on technology driven lines
• Encouragement for setting up large integrated textile complexes
• Strategic alliances with international textile majors, with focus on new products and
retailing strategies
• Creation of awareness and supportive measures for application of IT for up
gradation of technology, enhancement of efficiency, productivity and quality,
better working environment and HRD. The earlier policy of not nationalizing
sick units will be continued. As regards the unviable Public Sector
Undertakings (PSUs), various options for strategic partnerships or
privatization will be explored. Non-viable mills will be closed down with
provision for an adequate safety-net for workers and employees. Power loom
Industry The power loom sector occupies a pivotal position in the Indian
textile industry. However, its growth has been stunted by technological
obsolescence, fragmented structure, low productivity and low-end quality
products. The focus will therefore be on modernization of power loom service
centre and testing facilities, and clustering of facilities to achieve optimum
levels of production. Handloom Industry The handloom sector is known for its
heritage and the tradition of excellent craftsmanship. It provides livelihood to
India’s millions of weavers and crafts-persons. The industry has not only
survived but also grown over the decades due to its inherent strengths like
flexibility of production in small quantities, openness to innovation, low level
of capital investment and immense possibilities for fabric design. The
Government will continue to accord priority to this sector. Steps would be
taken to promote and develop its exclusiveness for the global market.
Measures will include the following:• Training modules for weavers engaged in the production of low value added items
with the objective of upgrading their skills to enable them to find alternate
employment in the textile or other allied sector
• Comprehensive welfare measures in close cooperation with the State Governments,
for better working environment and social security of weavers
• Effective support systems in R&D, design inputs, skill up gradation
• Review of the Hank Yarn Obligation Order and the Reservation Orders issued under
the Handloom (Reservation of Articles for Production) Act 1985, keeping in
mind the needs of handloom weavers Merchandising and marketing will be
central to the success of the handloom sector, the present package of schemes
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for production of value added fabrics will be streamlined, innovative market
oriented schemes will be introduced, and joint ventures will be encouraged
both at the domestic and international levels. Brand equity of handlooms will
also be commercially exploited to the extent possible. Knitting Hosiery
knitting, the growth of which has accelerated during the last decade primarily
because of expansion of hosiery into global fashion knitwear, is expected to
expand into the apparel and home furnishing sectors. In this segment, the
following measures will be taken:
• Review of the Policy of SSI Reservation for this sector
• Encouraging technology up gradation and expansion of capacity
• Introduction of support systems for commercial intelligence, design and fashion
inputs Carpets While machine-made carpet manufacturing in the mill sector
will be guided by the policy framework for the organized industry, the policy
for the hand knotted carpet sector will focus on sustained growth of exports
and welfare of weavers and their children. Encouragement will be given to the
manufacture of products that conform to and bear the ‘KALEEN’ mark of
standards, with insistence on compliance with the provisions of the Child
Labor (Prohibition and Regulation) Act, 1986. Government intervention will
be in technology up gradation, including indigenization of machines,
development of testing facilities, and use of natural dyes. Adaptation of
traditional motifs and promotion of brand image would also constitute thrust
areas.
5.9 SWOT ANALYSIS OF INDIAN TEXTILE INDUSTRY
-
Indian Textile Industry has done a remarkable achievement in terms
of growth and earning foreign exchange. The SWOT analysis of the industry
is given as follows:-
a. STRENGTH
• A large organized sector.
• A big production of yarn and silk.
• Govt. initiatives.
• A healthy foreign market share of 25%.
• There are well-established production bases for made-ups export as well as for
domestics market.
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• There is adequate processing facility for yarn dyeing and production of yarn dyed
Fabrics. Availability of well engineering industries.
• There are a large number of power loom owners and looms that are expanding in
size over the recent period.
b. WEAKNESS
• Poor supply chain management.
• Unavailability of skilled labors.
• Poor Transport facility.
• The most serious problem of the industry is the lack of adequate processing
facilities; there is over-dependence on hand processors and traditional items.
•The majority of the SMEs are tiny and cottage type units without sufficient capital
back-up.
•The quality of wider-width fabrics for meeting the export demand is lacking in many
respects, which is acting as a disadvantage to the growth of the industry.
c. OPPORTUNITIES
•A vast rural market in the country and European market.
•Upcoming commonwealth games in the country.
•Grey fabric export is continuing to grow and will show increasing trends.
•Nearly 40 textiles parks are being set up throughout the country under the Scheme
for Integrated Textile Parks (SITP), which is stated to attract an investment of
Rs 21.502 crore (US$ 4.42 million) and create employment, both direct and
indirect for 9.08 lakh workers and produce goods worth Rs 38.115 crore (US$
7.82 million) annually.
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d. THREATS
•Abolition of quota system will lead to fluctuations in the export demand
•Increasing competition from other states/centers (like Surat) will be a major problem
where the industries have come up afresh and are well developed and
technologically more advanced.
•Entry of global competitors
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CHAPTER-6
DATA ANALYSIS
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6.1 DATA ANALYSIS
6.1(a) Data of the duration of purchasing habits of peoples
0.4
0.35
0.3
0.25
0.2
0.15
0.1
0.05
0
Once a
month
Twice a
month
Every two
month gap
Once a year Occasionally
\
Interpretation
The above data shows the purchasing durations of the customer for
readymade garments. According to that data, more than 35% (39 %) peoples
goes once a month for purchasing readymade garments. 21% peoples goes
occasionally like- during festive season, during going for important parties,
during going to tour etc. 17% people goes at an interval of every two months
gap, 15% goes twice a month and at last 8% peoples purchases once a year.
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6.1 (b) Buying Habits of peoples
0.45
0.4
0.35
0.3
0.25
0.2
0.15
0.1
0.05
0
Branded
Cheaper
Colour varity
Fashionable
Interpretation
Day per day the buying habits’ of customers are changing. At the
present time, more than 40% people are looking for a fashionable verity of
products, 35% looking for a good brand they are the working class and higher
class peoples, 18% customers goes for verity of colors’, ex- different color
verity of formal shirts for offices or occasions, at last 6% customers looking
for cheaper products.
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6.1 (c) Buying Destinations of customers
0.5
0.45
0.4
0.35
0.3
0.25
0.2
0.15
0.1
0.05
0
Mall
Retail Outlet
Company
showroom
Local Store
Interpretation
The present customers have change their favorable place for buying
products from traditional retails to modern malls. Approx 50 % customers go
local stores for purchasing of readymade garments. 30% goes to organized
retail stores like, Big Bazaar, Vishal Mega Mart, TNG, Cotton County etc.
10% customers are looking foe the authorized showrooms of the company and
12% customers are looking for malls.
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6.1(d) Purchasing Limit of Customers
40%
35%
30%
25%
20%
15%
10%
5%
0%
Below 1000
1000-2000
2000-3000
Above 3000
Interpretation
At the present time, the average customer wishes to pay Rs. 1500 to
3000 for a readymade garment. 28% customers are those whose purchasing
limit is between 1000to 1500. The 19% peoples have a purchasing limit of
below 1000 they are the people of semi urban areas.
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6.51 (e) Purpose of purchasing of readymade garments
0.35
0.3
0.25
0.2
0.15
0.1
0.05
0
For Party wear
For Office
Purpose
For Daily Use
General
Purpose
Interpretation
Basically, the main purpose of purchasing of readymade garments are
for occasions or general purpose but from the last decade, it is found that more
than 35% customers are purchasing garments for office use, it is only due to
the corporate dress code. 30% garments are sell for general purpose, 20% for
daily use, and 15% for party wear.
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6.1 (f) References for purchase
0.45
0.4
0.35
0.3
0.25
0.2
0.15
0.1
0.05
0
Friend
Advertisement
Parents
Other
Interpretation
•41% customers influenced by their friends and other relatives.
•35% customers influenced by advertisements.
•20% customers influenced by other source of reference.
•4% customers influenced by their family members.
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6.1 (g) Companies with most Festival offer
0.35
0.3
0.25
0.2
0.15
0.1
0.05
0
Arwind Mills
Reliance
Raymond
Birla group
Other
Interpretation
At the modern time the main promotion strategy of maximum
companies are offering attractive schemes and free offers like. buy one get
two free, etc. in this field Arvind Mills leads with 32% of market share,
Reliance textiles follow with 18%, Raymond’s with 15% and Birla Groups
occupies 11% market share in offering attractive schemes. The other MNCs
and some local companies maintain a healthy share of 20% in issuing
attractive schemes.
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6.1 (h) Market share of major textile company
0.4
0.35
0.3
0.25
0.2
0.15
0.1
0.05
0
Arwind Mills
Reliance
Raymond
Birla group
Other
Interpretation
Arvind mills leads the market with a capitalization of 39%, it followed
by Reliance Textiles with 20%, Raymond’s occupied third place with a market
share of 18% of shares. Birla Groups has also occupies a healthy market share
of 16% with the entry of some international brands like Van Husain. Other
players like Bombay Dyeing, Mafatlal Shutting etc occupied the rest of 7% of
market.
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6.2 DATA ANALYSIS OF RATE PROVIDED BY THE PEOPLE ON THE
BASIS OF FOLLOWING FACTORS
We have asked the people to give rates to the product on the basis of following factors
QUALITY LOOKS. On the basis of their choices we have got
the following data:
Bar Chart for analysis
60%
50%
40%
Price
30%
Quantity
look
20%
10%
0%
Excellent
V. Good
Good
Average
Below
Average
Conclusion
In this analysis, we found that majority of people want quality product as the people
has given highest rating to quality where as looks and price are somehow rated
equally by the people
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6.3 FINDINGS, SUGGESTIONS AND CONCLUSION
a. KEY FINDINGS
After going through the whole study I found the following key findings:1. The Indian Textile Sector is an emerging sector of India.
2. The organized textile sector is more develop than the unorganized sector.
3. The growth rate of this sector is increasing much higher with a healthy rate of 20%.
4. It contains a major part in industrial production and export of country.
5. The increasing income level of people supports the growth of the industry.
6. Low level of technology and poor supply chain management are major resistance in
the development of the industry. So the major companies and the govt. has to
do a hard work on it.
7. There is a high availability of raw materials
8. Highly skilled economical labor, an added advantage
9. Largest producer of cotton yarn contributing 25% towards world’s cotton
10. Availability of all kinds of fibers like silk, cotton, wool and even high quality
synthetic fibers
11. Flexibility of the readymade garment industry in terms of sizes, fabric variety,
quantity, quality and cost
b. SUGGESTIONS
After the basis of above facts and findings I come to the following
suggestions:1. There is a need to improve our supply chain or logistic management.
2. There is a need to some more liberalization of export tariffs.
3. Need of import and implement of high quality technology.
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4. Govt. has to provide some more financial assistance to the domestic textile
companies.
5. The all promotion councils have to provide technical and management assistance to
the domestic industries.
6. Need to improve the quality of raw materials like cotton, yarn, synthetic etc.
7. Proper implementation of eleventh five year plan.
8. Build up world class state of the art manufacturing capacities to attain and sustain
predominant global standing in manufacture and export of textiles and
clothing.
c. CONCLUSION
As we analyzed the various data based on questionnaire, a fact has
came into light that Arvind Mills is the most known and popular Brand in
context of major Textile giant followed by Reliance and Birla Group. Because
of applying innovative ideas such as providing various facilities, launching
new schemes & offers Arvind Mill’s garments are more used by people as
compared to other one. Except it, people firstly prefer for good quality and
comparatively low prices Textile garments then they emphasized on qualities
and durability
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BIBILOGRAPHY
Some books helped us to have an idea about research methodology and preparing
questionnaire. These reference books are:
- NARESH K MALHOTRA
H METHODLOGY - C R KOTHAR
WEBSITE ADDRESS:
-www.wikipedia.com
- www.moneycontrol.com
-www.google.com
www.hepcindia.com
- www.indiancarpet.com
- www.aepcindia.com
-Textile policy 2000
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QUESTIONNAIRE
Name:-……………………………………..
Age:-………………………………………..
Address:-……………………………………
Occupation:-……………….........................
Contract No.:-……………………………….
1.
What is your total monthly income?
A) Below 5000 _______
B) 5000 to 10000_______
C) 10000 to 20000 _______
D) Above 25000 _______
2.
How many times you go to store for purchase readymade garments?
A) Once a month______
B) Twice a month_____
C) Every two months gap______
D) Once a year _______
E) Occasionally _______.
3. Which kind of garments you like to prefer?
A) Branded______.
B) Cheaper _______
C) Color Varity ______
D) Fashionable ______.
4. Where you go for shopping of garments?
A) Malls _______
B) Retail stores ______
C) Company Showrooms_______
C) Local stores ______.
5. What is your minimum purchasing limit of a readymade garment?
A) Below Rs. 1000
B) Between 1000 to 1500
C) Rs. 1500 to Rs. 3000
D) Above 3000
6. What is the purpose of your purchasing of garments?
A) For Party wear
B) For office purpose
C) For daily use
D) General purpose
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7. Which factor mostly affects your decision while purchasing any readymade
garments?
A) FRIENDS
B) ADVERTISEMENT
C) PARENTS
D) OTHERS
8.Which company provides you most festival offers?
A) Arvind Mills
B) Reliance
C) Raymond’s
D) Pape Jeans
9.Which brand you prefer much more?
A) Arvind mills
B) Reliance Textiles
C) Raymond’s
D) Birla Group
E) Others
10.Suggestion…………………………………………………………………………..
..............................................................................................................
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