SIP Report- Aman Agrawal

Summer Internship Report Page 1
A PROJECT REPORT
ON
THE STUDY OF EXPORT PROCEDURE AND DOCUMENTATION OF
FOOD PRODUCTS AT
WEIKFIELD FOODS PVT. LTD.
BY
AMAN AGRAWAL
MBA- IB (2014 – 2016)
IN PARTIAL FULFILLMENT OF
MASTER IN BUSINESS ADMINISTRATION
SAVITRIBAI PHULE PUNE UNIVERSITY
M.A.E.E.R s MIT SCHOOL OF MANAGEMENT
PUNE: 411038

CERTIFICATE
This is to certify that Mr. AMAN AGRAWAL of MAEER’s MIT School of Management has
successfully completed the project work titled “The Study of Export procedure and
Documentation of Food Products at WEIKFIELD FOODS PVT LTD” in partial fulfilment of
requirement for the award of MBA prescribed by the Savitribai Phule Pune University.
This project is the record of authentic work carried out during the academic year
2015 – 2016.
Prof. Nirav Suratwala Prof. Dr. Sayalee Gankar
Internal Project Guide Director - MITSOM

DECLARATION
I, Mr. Aman Agrawal hereby declare that this project is the record of authentic work carried out
by me during the academic year 2015-16 and has not been submitted to any other University or
Institute towards the award of any degree.
Aman Agrawal

ACKNOWLEDGEMENT
In two years course in Master’s In Business Administration (MBA), Summer Internship is a part
of it which provides practical exposure about the real life working environment. So it is an
important and challenging part of two years course curriculum.
My project work is supported by unparallel help & guidance from respected persons with whom
I have been acquainted with in the course of the project. I feel extremely satisfied to be able to
acknowledge their help & support in completion of my project work. I express my gratitude &
thanks to Prof. Nirav Suratwala my project guide whose inspiring suggestions & guidance
made it possible for me to go on with the project & had a great influence on my thinking I owe a
considerable debt of gratitude to Prof. (Dr). Sayalee Gankar the director of MITSOM for
helping to get my Academic Career started.
It has been a great pleasure &an enriching experience working with WeikField Food Pvt.
Ltd. I wish to accord my gratitude to each & every person of the Company. Especially
Mr.Hemant Pawale, G.M. (Import and Export Department) for giving me valuable advice
and guidance and sparing valuable time in clarifying various points raised by me.
Before concluding I must convey regards & heartiest gratitude to my family & friends who have
expended their unbelievable co-operation directly or indirectly in helping me to complete this
project.
Aman Agrawal

CONTENTS
Sr.No. Title Page No.
Executive Summary 6
1 Introduction 7-9
2 Company Profile 10-17
3 Literature Review 18
4 Research Methodology 19-20
5 Theoretical Background 21-35
6 Learning Outcomes 36
7 Recommendation 37-38
8 Conclusion 39
9 Bibliography 40
10 Annexure 41-48

EXECUTIVE SUMMARY
India is one of the world’s largest producers as well as consumer of food products, with the
sector playing an important role in contributing to the development of the economy. Food and
food products are the largest consumption category in India, with a market size of USD 181
billion. Domestically, the spending on food and food products amounts to nearly 21% of the
gross domestic product of the country and constitutes the largest portion of the Indian consumer
spending more than a 31% share of wallet. Going forward, the Indian domestic food market is
expected to grow by nearly 40% of the current market size by 2015, to touch USD 258 billion by
2015.
Food processing industry in India is increasingly seen as a potential source for driving the rural
economy as it brings about synergy between the consumer, industry and agriculture. A well
developed food processing industry is expected to increase farm gate prices, reduce wastages,
ensure value addition, promote crop diversification, generate employment opportunities as well
as export earnings. In order to facilitate and exploit the growth potential of the sector, the
government on its part has initiated extensive reforms. Some of the key measures undertaken by
the Government include: amendment of the Agriculture Produce Marketing Committee Act,
rationalization of food laws, implementation of the National Horticulture mission etc. The
government has also outlined a plan to address the low scale of processing activity in the country
by setting up the mega food parks, with integrated facilities for procurement, processing, storage
and transport. To promote private sector activity and invite foreign investments in the sector the
Government allows 100% FDI in the food processing & cold chain infrastructure. The recent
budget has announced several policy measures, especially for the cold chain infrastructure, to
encourage private sector activity across the entire value chain.
However, despite of continual efforts and initiatives of the Government to provide the required
stimulus to the sector, processing activity is still at a nascent stage in India with low penetration.
At the same time, though India is a key producer of food products, having an adequate
production base for inputs, productivity levels are very low in the country. While India remains a
top producer of food, production yield levels are among the lowest amongst the BRIC countries.
Also, the Indian export market, at USD 13.7 billion, has a share of only 1.4% of the world food
trade.

1. INTRODUCTION
This project is all about to know about export procedure and documentation of food products in
WeikField Food Pvt. Ltd. This project puts more focus on to know custom clearness, to make
export import invoice, to get shipping bill, export sales, contract, terms and conditions, set up an
export organization, shipping and custom formalities, set up for an export organization, structure
of an organization, IEC number, how one begins to do export, processing an export order,
factory stuffing, etc.
TYPES OF EXPORTERS:
Exporters can be basically classified into two groups:
1. Manufacturer Exporter: As the exporter has the facility to manufacture the products he
intends to export and hence he exports the products manufactured by him.
2. Merchant Exporters: An exporter who does not have the facility to manufacture an
item. But, he procures the same from other manufacturers or from the market and exports
the same.
An exporter can be both, a manufacturer exporter as well as a merchant exporter, he can export
product manufactured by him or he can export items bought from the market.
Once it is decided to export, it is mandatory on your part to follow certain procedures, rules and
regulations as prescribed by various authorities such as DGFT, RBI and customs. These
procedures, rules and regulations are laid down in the Policy, Exchange Control Manual and
Custom Act, etc. Accordingly Export documents are required to be prepared keeping in view of
the requirement of the foreign buyers and our regulatory authorities.
In India ships transport more than 90% of the cargo. It therefore interesting to study the export
processed by ships documentation related to it.
Processing of an export order:
Exporter operation starts with the receipt of enquiry by the exporter from importer. In the
enquiry, exporter submits his offer giving complete details of product technical, specific price,
delivery payments terms, etc.

After the process, negotiations importer sends a purchase order follow by Letter of Credit (if
applicable).
The exporter manufactures or purchases the goods according to the specifications given in
purchase order.
As soon as the goods are ready, the exporter invites the representative of Export Inspection
Agency (EIA) for the pre shipment inspection and contains the certificate of inspection is issued.
After that, the exporter prepares following documents:
1. Invoice
2. Packing List
3. ARE-I from excise department
4. Marine Insurance Policy
5. Copy of Purchase Order
Above those documentation sends to CHA by exporter.
Based on these documents Custom House Agent (CHA) completes the Octroi Formalities, obtain
port permit and prepare shipping bill which is a customs document. Custom department checks
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.
The shipping line gives mate receipt to CHA after the payments if ocean freight and port due
obtains the bill of lading from shipping line. Bill of lading is a proof of dispatch of cargo and
also a negotiable document.
After that CHA sends various documents back to exporter which is:
1. Customs attested invoice
2. Copy of Shipping Bill
3. Full set of non-board bill of lading
4. Copies of purchase order
5. Copies of ARE 1 Form
6. SDF Form
After that, the exporter submits above documents to bank for negotiation which include:
1. Commercial Invoice
2. Packing List
3. SDF Form

4. Original Copy of Purchase Order
5. Certificate of Origin
6. Bill of Exchange
7. Shipment Advice

2. COMPANY PROFILE
Name of Company: WeiKFiELD Foods Pvt. Ltd.
Address: Gat No. 485, Lonikand,
Nagar Road,
Pune-412216
Maharashtra, India.
2.1 Board of Director
Mr. S. P. Malhotra - Chairman
Mr. B. R. Malhotra - Vice-Chairman
Mr. MukeshMalhotra - Director
Mr. AkshayMalhotra - Director
Mr. ParagSaxena - Director
Mr. AshwiniMalhotra - Managing Director
2.2Mission Statement
“To produce and market trusted food brands, conforming to the highest international
standards of quality and convenience for discerning customers in the Indian and Global markets,
with every WeiKFiELD employee passionately dedicated to achieving the goals of the
organization.”
2.3 Values of Company
 Customer Focus
 Passion Excellence
 Continuous all round innovation
 Transparency and Integrity
 People development
 Social Responsibility

2.4 Historical Background and Current Status of the Company:
WeiKFiELD Foods Pvt. Ltd. was established in the year 1956. It was one of the earliest entrants
in the processed foods market in India and today is a leading player in the same. It is the market
leader in branded Cornflour and Custard Powder. The company has around 400 employees with
more than 300 in manufacturing operations. Today, the network spans 100,000 retail outlets
across India and 5 continents globally. The company was functional as a single manufacturing
facility at Ramwadi, Pune till 2008. The manufacturing operations were split into 3 units –
Lonikand and Bakhori in Pune and Nalagarh in Himachal Pradesh in year 2008. The company
has total 70 products with 326 SKU’s for the domestic market and customized to order for export
markets. The company products are divided as follows:
1. GPD: General Product Division – Dry Products such as Baking Powder, Custard Powder,
etc.
2. APD: Agricultural Product Division – Agro-processed Products such as Mushrooms,
Sauces, etc.
3. IPD: International Product Division – Imported Products such as Pasta, Fruit Preserves
Fig. 1 shows the company’s Supply chain.
Fig. 1: WFPL’s Supply Chain
Domestic and
foreign
suppliers for
Raw Materials
and Packing
Material
Suppliers
•Lonikand &
Bakhori in
Pune, Mah.
•Nalagarh H.P.
Manufacturin
g Unit
•19 domestic
C&F Agents
•Export
Operations in
23 Countries
Customers

WeiKFiELD Foods Pvt. Ltd. has been split in three separate units, out of this three two are at
Lonikand and Bakhori in Pune and one is at Nalagarh at Himachal Pradesh.
Fig2: WeiKFiELD Foods Pvt. Ltd. Units
2.5 WeiKFiELD Foods Pvt. Ltd., Lonikand:
WFPL, Lonikand Unit was set up in year 2008 after splitting the company’s operations. It is an
ISO 22000:9001 certified unit. Currently, the unit handles processing and packaging operations
of 12 products mentioned in Table 1. All export operations are carried out in this facility.
Sr.
No.
Name of Product
1 WeiKFiELD Custard Powder Vanilla
2 WeiKFiELD Flavored Custard Powder
3 WeiKFiELD Cornflour
4 WeiKFiELD Icing Sugar
5 WeiKFiELD Jelly
6 WeiKFiELD Oats
7 WeiKFiELD White Pasta Sauce Mix
8 WeiKFiELD Pudding
9 WeiKFiELD Flavored Tea
10 WeiKFiELD Baking Powder
WeiKFiELD
Foods Pvt. Ltd.
Lonikand
Bakori
Nalagarh

11 WeiKFiELD Glucose
12 WeiKFiELD Drinking Chocolate
Table 1: List of products manufactured at WFPL, Lonikand
At Lonikand unit, there are 20 permanent and 75 casual staff and 200 workers to handle the back
office work and manufacturing, packaging operation. Lonikand unit has different division as,
1. Desert and Ingredient Division
2. Health foods and Beverages Division
3. Export Division
2.6 Organization Chart:
Fig. 2 shows the organization chart of WeiKFiELD Foods Pvt. Ltd.
Fig. 3: Organization Chart

2.7 Pillars of Company
Fig. 4: Pillars of Company

2.8 Product Profile of Company:

3. LIREATURE REVIEW
Athukorala, et al. (2002) observed that as the developed countries have better processing
technologies, packaging facilities etc, they are better positioned for export prospects of food
processing sector over the developing countries. Athukorala and Jayasuriya (2003) highlighted,
due to some infrastructural inadequacy the impact of food safety standards on processed food
exports in developing countries are still inconclusive. Mehta and George (2003) said the
processed food exports can be a viable instrument to sustain and enhance social welfare in
developing countries and this will be possible if all trading partners work towards making the
trinity of science, safety and trade of food products blend to form a harmonious unity. Wilkinson
(2004) studied transformations in the food processing sectors of developing countries are
increasingly seen as strategic from the point of view of export earnings, domestic industry
restructuring and dietary issues. Studies by Chenggapa et al (2005) and Mukherjee & Patel
(2005) pointed out though Indian consumers have preferred fresh and unprocessed food over
processed and packaged food, the recent changes in consumption patterns, particularly in middle
and high income groups show ample opportunity for processed food segments in the country.
Goyal and Singh (2007) found, rising income, increased urbanization, changing lifestyle, greater
willingness to experiment with new products, increase in the number of working women etc.
have led to a strong growth in consumption of processed food products. Study by Dharni and
Sharma (2008) indicated that Food processing sector is an important link between agriculture
and industry. In this study, the non-parametric DEA approach is used to Export Performance of
Processed Food in India 263 compute the Malmquist Total Factor Productivity (TFP) change. An
inter-country econometric study of processed food exports by Jongwanich (2009) highlighted
that food safety standards imposed by developed countries have a negative implication for
processed food exports from developing countries.

4. RESEARCH METHODOLOGY
The term “Research” pertains to a “search for facts”. It refers to a careful and exhaustive
investigation of a given subject with a definite objective of attaining or enhancing one’s
knowledge level.
“Research is the systematic and objective analysis and recording of controlled observation that
may lead to development of generalization, principles or theories resulting in prediction and
perhaps ultimate control of events.”
Topic of Research: “The Study of Export procedure and Documentation of Food Products at
WeikField Food Pvt. Ltd.”
Area of Research: International Business Management
Duration: 2 Months
Objective:
1. To study the concept and procedure of Export.
2. To study the documents required in Export transaction.
3. To study Inco-Terms.
4. To study about the structure and functioning of various departments.
Types of Data:
While deciding about the method of data collection to be used for the study, the researcher
should keep in mind two types of data:
1. Primary
2. Secondary
The primary data are those which are collected afresh and for the first time, and thus happen to
be original in character.
The secondary data, on the other hand, are those which have already been collected by someone
else and which have already been passed through the statistical process.
Sources of Data:
1. Primary Data: Interaction with employees, staff, e-mail, etc.
2. Secondary Data: Shipping bill, invoices, various documents, etc.

Research Design:
Research design is the based framework, which provides guidelines for the research process. It is
map or blue print according to which the research is to be conducts. The research design
specifies the methods for the data collection and data analysis determine the source of data. Most
specifically it was a kind of “Descriptive Research” who takes care of who, where, when, 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.
The data collected from the company was analyzed, interpreted with the help of table and
diagram.
Limitations:
1. Company was not able to provide relevant data as it was confidential.
2. Time duration was another drawback in conducting the project.

5. THEORETICAL BACKGROUND
5.1 Set Up & Need For An Export Organization:
The proper selection of organization depends upon:
1. Ability to raise finance.
2. Capacity to bear the risk.
3. Desire to exercise control over the business.
4. Nature of regulatory framework applicable to anyone.
5.2 Structure ofan Export Organization:
Marketing manager for generating sales
Commercial manager for looking activities of the execution of the orders
Staff personnel for carrying out the day-to-day activities, namely:
1. Preparation of pre - shipment documents.
2. Co-coordinating with clearing agents on the progress of the shipment to be made.
3. Co-ordinations with the ware houseC. excise department regarding packing and
clearance of the goods for export.
4. Preparation of post shipment documents for banks.
5. Follow-up with the bank on dispatch of documents, receipt of payment, an ailment of
bank loans etc.
To look into the requirement of licenses, claiming of export benefits filing of documents with the
Government Authorities in Discharge of Export Obligations, if any, filing of returns to the
various Government Agencies which are mandatory, prepare and keep an information bank of
various transaction of the company, their domestic as well as international competitors.
An office boy for doing leg work
A clearing and forwarding agent to handle the documents and goods in the customs premisesin
the port of lading.
Depending upon the size of the business the numbers of personnel under each category may
increase. For example if a company is transacting substantial volume of business in more than
one product. Then it is necessary to have marketing manager for each product so that the person
can concentrate on a particular trade to enhance the business.

5.3 How One Begins To Do Exports:
Before entering into the venture of exports, one must look for the product to be exported and the
market where he intends to export.
In case of a manufacturer, obviously he would like to export the product he manufactures as is or
with possible modification as may be required by the market. However, in case of a merchant
exporter or a trader, one has to identity the product to export. If the exporter is already in the
trade in the domestic market and is familiar with the product it would be an advantage to export
the said product of which he has reasonable knowledge.
Before selecting a product, one must simultaneously made a study and find out the prospective
market. For finding out the market for the selected product, the following methods will help:
1. Get statistical information as to imports of the product by various countries and their
growth prospects in the respective countries
2. Approach the chamber of commerce for their guidance to find out the market.
3. Approach the Export Promotion Council dealing in the product of selection to get more
information.
Once you are ready with the product you wish to export and have found the market for the same,
you are ready to proceed further. Following sequences can be followed:
Anyone, who wishes to export, must first of all get an Importer Exporter Code Number (IE
Code).This can be obtained by making a formal application to the office of the Regional
Directorate General of Foreign Trade (DGFT).
Get yourself registered with the related Export Promotion Council and become a member. Also
arrange to obtain Registration-Cum-Membership Certificate (RCMC) from the council.
Under the Foreign Trade Policy, it is mandatory that an exporter gets him registered with the
Export Promotion Council to avail of various export facilities.
Being a member, you will have access to all the information relating to the product that could be
made available by the council.
Many foreign buyers send their enquiries for the imports to the Export Promotion Council.
Hence you will have few customers interested in your product.
1. Understand the local government regulations in relations to the export of the product.

2. Get information of the government’s regulations of the importing country as to
restrictions on the quantity, product specification, packing regulations, customs
regulations, requirement of specific documents/information etc.
3. Availability of Vessels/Airlines, the transport charges, frequency of operation etc.,
4. To look for a Custom House Agent (CHA) (clearing agents) for handling the
documents/cargo in the customs.
5. If the product is covered under any quota regulation, find out the agency/council who is
handling the quota distribution for the product and the availability of quota for exports.
5.4 Registration for Obtaining Importer Exporter Code (IEC) Number:
The Customs Authorities will now allow the exporter to export or import goods into or from
India unless he holds a valid IEC number. Before applying for IEC number it is necessary to
open a bank account in the name of the company with any commercial bank authorized to deal in
foreign exchange. The duly signed application form should be supported by the following
documents.
1. Bank receipt (in duplicate) / Demand Draft for payment of the fees of Rs. 1000/-
2. Certificate from the banker of the applicant firm as per Annexure 1 to the form given.
3. One copy of PAN number issued by Income Tax Authorities duty attested by the
applicant.
4. One copy of Passport Size photographs of the applicant duly attested by the banker to the
applicant.
5. Declaration by the applicant that the proprietor / directors as the case may be of the
applicant company, are not associated as proprietor / directors in any other firm, which
has been caution, listed by the RBI. Where the applicant declares that they are associated
as proprietor / directors in any other firm, which has been caution, listed by the RBI, they
will be allotted IEC No. but with an additional condition that they can export only with
RBI’s prior approval and they should approach RBI for the purpose.
6. Each importer/exporter shall be required to file importer/exporter profile once with the
licensing authority shall enter the information furnished in Appendix 2 in their database
so as to dispense with changes in the information given in Appendix-2, importer/exporter
shall intimate the same to the licensing authority.

5.5 Finding a Customer:
Once you have selected the market, the next step is to find a prospective customer. This you can
get,
1. From the directory of importers of the country.
2. By writing to the Embassy of India in that country for assistance.
3. By means of participation in a Fair / Exhibition abroad either directly or through the
export promotion council.
4. By participating in international fair if organized locally.
5. From the personal contacts in that country.
5.6 Negotiating Contract:
Once the prospective customer is found, the business deal has to be concluded.
The following aspects may be considered before entering into a final contract with the customer:
1. Credit worthiness of the customer.
2. Availability of the steamer / airlines and the frequency.
3. The freight charges.
4. The full product specification.
5. The quantity, price.
6. Terms of payment.
7. Type of packing and markings on the packages.
8. Mode of shipment & shipment schedule.
9. Quantity to be shipped.
10. Documentation requirement for the customer.
11. Compliance of the local governmental rules and regulations.
Before entering into contract one should take note of the above factors.
5.7 Processing an Export Order:
You should not be happy on receiving an export order.
You should first acknowledge the export order, and then processed to examine carefully in
respect of Items:
1. Pre-shipment inspection
2. Special packaging
3. Shipment and delivery date

4. Documentation requirement
5. Specification
6. Payment condition
7. Labeling and marketing
8. Requirements
9. Marine insurance, etc.
If you are satisfied on these aspects, a formal confirmation should be sent to the buyer, otherwise
clarification should be sought from the buyer before confirming the order. After confirmation of
the export order immediate steps should be taken for procurement/manufacture of the export
goods. In the meanwhile, you should proceed to enter into a formal export contract with the
overseas buyer.
5.8 Financial Risks Involved In Foreign Trade:
As an exporter while selling goods abroad, you encounter various types of risks. The major risks
which you have to undergo are as follows:
1. Credit Risk
2. Currency Risk
3. Carriage Risk
4. Country Risk
You can protect yourself against the above risks by initiating appropriate steps.
5.8.1. Credit Risk:
You can cover your credit risk against the foreign buyer by insisting upon opening a letter of
credit in your favor. Alternatively one can avail of the facility offered by various credit risk
agencies. A specific insurance cover can also be obtained from ECGC (Exports Credit &
Guarantee Corporation) to cover your country risk besides covering credit risk.
5.8.2. Currency Risk:
As regards covering the currency risk, due to the exchange rate fluctuations, you can request
your banker to book a forward contract.
5.8.3. Carriage Risk:
The carriage risk can be covered by taking an appropriate general insurance policy.
5.8.4. Country Risk:
ECGC provides cover to protect the exporter from country risks.

5.9 Mode of Transportation:
I. Air Transport
II. Ocean Transport
III. Rail Transport
IV. Road Transport
Ocean Transport:
More than 95% of international trade is conducted by sea routes since ancient times, sea routes
are being used for transportation of cargo from one country to another and is also used for
transporting the cargo from one port within the country to another.
For example, In India the cargo can be transported from Chennai port to Visakhapatnam port
using the shipping route.
Sea routes are used for carrying bulk commodities like such as coaling and thermal coal mines,
fertilizers, crude oil acids, cotton bales and all agricultural product, etc. The modern ships have
the capacity to carry 7000 containers. One of the biggest cargos owned by Maersk-sea land is
1,138 feet long from end to end and 140 feet wide at mid ship. Such ships are called post-
panamax ship.
Fig.5: Export Procedure

5.10Export Documents:
5.10.1. Commercial Invoice:
Commercial invoice is an important and basic export document. It is also known as a 'Document
of Contents' as it contains all the information required for the preparation of other documents. It
is actually a seller's bill of merchandise. It is prepared by the exporter after the execution of
export order giving details about the goods shipped. It is essential that the invoice is prepared in
the name of the buyer or the consignee mentioned in the letter of credit. It is a prima facie
evidence of the contract of sale or purchase and therefore, must be prepared strictly in
accordance with the contract of sale.
5.10.2. Inspection Certificate:
The certificate is issued by the inspection authority such as the export inspection agency. This
certificate states that the goods have been inspected before shipment, and that they confirm to
accepted quality standards.
5.10.3. Marine Insurance Policy:
Goods in transit are subject to risks of loss of goods arising due to fire on the ship, perils of sea,
thefts etc. Marine insurance protects losses incidental to voyages and in land transportation.
Marine Insurance Policy is one of the most important document used as collateral security
because it protects the interest of all those who have insurable interest at the time of loss.
Types of Policy:
1. SPECIFIC POLICY: This policy is taken to cover different risks for a single shipment.
2. FLOATING POLICY: This policy is taken to cover all shipments for same months.
There is no time limit, but there is a limit on the value of goods and once this value is
crossed by several shipments, then it has to be renewed.
3. OPEN POLICY: This policy remains in force until cancelled by either party, i.e.
insurance company or the exporter.
4. OPEN COVER POLICY: This policy is generally issued for 12 months period, for all
shipments to one or all destinations.
5. INSURANCE PREMIUM POLICY: Differs upon from product to product and a number
of other such factors, such as, distance of voyage, type and condition of packing etc.
Premium for air consignments are lower as compared to consignments by sea.

5.10.4. Consular Invoice:
Consular invoice is the most important document, which needs to be submitted for certification
to the Embassy of the importing country concerned. The main purpose of the consular invoice is
to enable the authorities of the importing country to collect accurate information about the
volume, value, quality, grade, source, etc., of the goods imported for the purpose of assessing
import duties and also for statistical purposes.
In order to obtain consular invoice, the exporter is required to submit three copies of invoice to
the Consulate of the importing country concerned. The Consulate of the importing country
certifies them in return for fees. One copy of the invoice is given to the exporter while the other
two are dispatched to the customs office of the importer's country for the calculation of the
import duty. The exporter negotiates a copy of the consular invoice to the importer along with
other shipping documents.
5.10.5. Certificate of Origin:
The importers in several countries require a certificate of origin without which clearance to
import is refused. The certificate of origin states that the goods exported are originally
manufactured in the country whose name is mentioned in the certificate. Certificate of origin is
required when:
1. The goods produced in a particular country are subject to’ preferential tariff rates
in the foreign market at the time importation.
2. The goods produced in a particular country are banned for import in the foreign
market.
5.10.6. Bill Of Lading:
The bill of lading is a document issued by the shipping company or its agent acknowledging the
receipt of goods on board the vessel, and undertaking to deliver the goods in the like order and
condition as received, to the consignee or his order, provided the freight and other charges as
specified in the bill have been duly paid. It is also a document of title to the goods and as such, is
freely transferable by endorsement and delivery.
Bill Of Lading Serves For 3 Main Purposes:
1. As a document of title to the goods
2. As a receipt from the shipping company
3. As a contract for the transportation of goods

5.10.7. Airway Bill:
An airway bill, also called an air consignment note, is a receipt issued by an airline for the
carriage of goods. Airway Bill or Air Consignment Note is not treated as a document of title and
is not issued in negotiable form. It is a contract between the airlines or his agent to carry goods to
the destination. It is the document of instructions for the airline handling staff. It acts as a
customs declaration form. Since, it contains details about freight it also represents freight bill.
5.10.8. Shipment Advice to Importer:
After the shipment of goods, the exporter intimates the importer about the shipment of goods
giving him details about the date of shipment, the name of the vessel, the destination, etc. He
should also send one copy of non-negotiable bill of lading to the importer.
5.10.9. Packing List:
The exporter prepares the packing list to facilitate the buyer to check the shipment. It contains
the detailed description of the goods packed in each case, their gross and net weight, etc. The
difference between a packing note and a packing list is that the packing note contains the
particulars of the contents of an individual pack, while the packing list is a consolidated
statement of the contents of a number of cases or packs.
5.10.10. Bill Of Exchange:
The instrument is used in receiving payment from the importer. The importer may prefer bill of
exchange to LC as it does not involve blocking of funds. A bill of exchange is drawn by the
exporter on the importer, to make payment on demand at sight or after a certain period of time.
1. Bill of Exchange is a means to collect payment.
2. Bill of Exchange is a means to demand payment.
3. Bill of Exchange is a means to extent the credit.
4. Bill of Exchange is a means to promise the payment.
5. Bill of Exchange is an official acknowledgement of receipt of payment.
5.10.11. Shipping Bill:
Shipping bill is the main customs document, required by the customs authorities for granting
permission for the shipment of goods. The cargo is moved inside the dock area only after the
shipping bill is duly stamped, i.e. certified by the customs.

Shipping bill is normally prepared in five copies:
1. Customs copy.
2. Drawback copy.
3. Export promotion copy.
4. Port trust copy.
5. Exporter’s copy.
5.10.12. A.R.E. 1 Forms (Central Excise):
This form ARE-1 is prescribed under Central Excise rules for export of goods. In case goods
meant for export are cleared directly from the premises of a manufacturer, the exporter can avail
the facility of exemption from payment of terminal excise duty. The goods may be cleared for
export either under claim for rebate of duty paid or under bond without payment of duty. In both
the events the goods are to be cleared under form A.R.E-1 which will show the details of the
goods being exported, the relevant duty involved and if the duty is paid or goods being cleared
under bond, details of goods being sealed either by the exporter or Central Excise officials etc
5.10.13. Exchange Control Declaration Form:
This form ARE-1 is prescribed under Central Excise rules for export of goods. In case goods
meant for export are cleared directly from the premises of a manufacturer, the exporter can avail
the facility of exemption from payment of terminal excise duty. The goods may be cleared for
export either under claim for rebate of duty paid or under bond without payment of duty. In both
the events the goods are to be cleared under form A.R.E-1 which will show the details of the
goods being exported, the relevant duty involved and if the duty is paid or goods being cleared
under bond, details of goods being sealed either by the exporter or Central Excise officials etc.
5.10.14. Export Application:
This is the application to be made to the customs officials before shipment of goods. The
prescribed form of the application is the Shipping Bill/Bill of Export. Different types are
required for shipment like ex-bond, duty free goods, and dutiable goods and for export under
different export promotion schemes such as claims for duty drawback etc.
5.10.15. Vehicle Ticket/Car Ticket/Gate Pass:
Before the goods are being taken inside the port for loading, necessary permission has to be
obtained for moving the vehicle into the customs area. This document will contain the detail of

the export cargo, name and address of the shippers, lorry number, marks and number of the
packages, driver’s license details etc.
5.10.16. Other Documents:
1. Black List Certificate: It certifies that the ship/aircraft carrying the cargo has not touched the
particular country on its journey or that the goods are not from the particular country.
2. Language Certificate:Importers in the European Community require a language certificate
along with the GSP certificate in respect of handloom cotton fabrics classifiable under NAMEX
code 55.09. Generally four copies of language certificate are prepared by the concerned authority
who issues GSP certificate. Three copies are handed over to the exporter. A copy is sent along
with the other documents for realization of export proceeds.
3. Freight Payment Certificate:In most of the cases, the B/L or AWB will mention the
transportation and other related charges. However if the exporter does not want these details to
be disclosed to the buyer, the shipping company may issue a separate certificate for payment of
the freight charges instead of declaring on the main transport documents. This document
showing the freight payment is called the freight certificate.
4. Insurance Premium Certificate: This is the certificate issued by the Insurance Company as
acknowledgement of the amount of premium paid for the insurance cover.
5.11Method of Receiving Payments against Export:
Method of Payments:
1. Payment in advance
2. Documentary Bills
3. Letter of Credit
5.11.1. Payments In Advance:
This method does not involve any risk of bad debts, provided entire amount has been received in
advance. At times, a certain per cent is paid in advance, say 50% and the rest on delivery. This
method of payment is desirable when:
1. The financial position of the buyer is weak or credit worthiness of the buyer is not
known.
2. The economic/ political conditions in the buyer’s country are unstable.
3. The seller is not willing to assume credit risk.

5.11.2. Documentary Bills:
Under this method, the exporter agrees to submit the documents to his bank along with the bill of
exchange. The minimum documents required:
1. Full set of bill of lading
3. Marine Insurance policy and other document, if required.
5.11.3. Letter Of Credit:
A letter of credit can be defined as “An undertaking by importer’s bank stating that payment will
be made to the exporter if the required documents are presented to the bank within the variety of
the L/C”. Contents:
A letter of credit is an important instrument in realizing the payment against exports. So,
needless to mention that the letter of credit when established by the importer must contain all
necessary details which should take care of the interest of Importer as well as Exporter.
Fig.6: Flow Chart of Letter of Credit

5.12 INCO-TERM:
“InternationalCommercial TERMS”
“INCO-TERMS define the mutual obligations of seller and buyer arising from the movement
of goods under an international contract from the standpoint of risks, costs and documents”.
Initially created in 1936 by the International Chamber of Commerce (ICC) and have been
periodically revised. (Inco terms 2010 is the 8th
revision)
The seven rules defined by Inco terms 2010 for any mode(s) of transportation are:
1. EXW – Ex Works (named place of delivery):
The seller makes the goods available at its premises. This term places the maximum obligation
on the buyer and minimum obligations on the seller. The Ex Works term is often used when
making an initial quotation for the sale of goods without any costs included. EXW means that a
seller has the goods ready for collection at his premises (works, factory, warehouse, plant) on the
date agreed upon. The buyer pays all transportation costs and also bears the risks for bringing the
goods to their final destination. The seller doesn't load the goods on collecting vehicles and
doesn't clear them for export. If the seller does load the good, he does so at buyer's risk and cost.
If parties wish seller to be responsible for the loading of the goods on departure and to bear the
risk and all costs of such loading, this must be made clear by adding explicit wording to this
effect in the contract of sale.
2. FCA – Free Carrier (named place of delivery):
The seller hands over the goods, cleared for export, into the disposal of the first carrier (named
by the buyer) at the named place. The seller pays for carriage to the named point of delivery, and
risk passes when the goods are handed over to the first carrier.
3. CPT - Carriage Paid To (named place of destination):
The seller pays for carriage. Risk transfers to buyer upon handing goods over to the first carrier.
4. CIP – Carriage and Insurance Paid to (named place of destination):
The containerized transport / multimodal equivalent of CIF. Seller pays for carriage and
insurance to the named destination point, but risk passes when the goods are handed over to the
first carrier.
5. DAT – Delivered at Terminal (named terminal at port or place of destination):
Seller pays for carriage to the terminal, except for costs related to import clearance, and assumes
all risks up to the point that the goods are unloaded at the terminal.

6. DAP – Delivered at Place (named place of destination):
Seller pays for carriage to the named place, except for costs related to import clearance, and
assumes all risks prior to the point that the goods are ready for unloading by the buyer.
7. DDP – Delivered Duty Paid (named place of destination):
Seller is responsible for delivering the goods to the named place in the country of the buyer, and
pays all costs in bringing the goods to the destination including import duties and taxes. This
term places the maximum obligations on the seller and minimum obligations on the buyer.
Rules for Sea and Inland Waterway Transport:
The four rules defined by Inco terms 2010 for international trade where transportation is entirely
conducted by water are:
1. FAS – free alongside Ship (named port of shipment):
The seller must place the goods alongside the ship at the named port. The seller must clear the
goods for export. Suitable only for maritime transport but NOT for multimodal sea transport in
containers (see Inco terms 2010, ICC publication 715). This term is typically used for heavy-lift
or bulk cargo.
2. FOB – Free on Board (named port of shipment):
The seller must load the goods on board the vessel nominated by the buyer. Cost and risk are
divided when the goods are actually on board of the vessel (this rule is new!). The seller must
clear the goods for export. The term is applicable for maritime and inland waterway transport
only but NOT for multimodal sea transport in containers (sees Inco terms 2010, ICC publication
715). The buyer must instruct the seller the details of the vessel and the port where the goods are
to be loaded, and there is no reference to, or provision for, the use of a carrier or forwarder. This
term has been greatly misused over the last three decades ever since Inco terms 1980 explained
that FCA should be used for container shipments.
3. CFR – Cost and Freight (named port of destination):
Seller must pay the costs and freight to bring the goods to the port of destination. However, risk
is transferred to the buyer once the goods are loaded on the vessel (this rule is new!). Maritime
transport only and Insurance for the goods is NOT included. This term is formerly known as
CNF (C&F).

4. CIF – Cost, Insurance and Freight (named port of destination):
Exactly the same as CFR except that the seller must in addition procure and pay for the
insurance.

6. LEARNING OUTCOME
1. All the departments are interconnected which simplifies the work.
2. The process is developed in such a way that it performs its work without interruption.
3. The flow chart provides the detailed information about export process.
4. Government plays important role for promotion of export.
5. Export Oriented Unit (EOU) enjoys government subsidy benefits and generates more
revenue.
6. The company has to face delay while receiving the payments from clients due lack of
proper follow up of documents.

7. SUGGESTIONS
The food industry in India is yet to fully develop. Presently, only about 2 per cent of fruits and
vegetables are processed. Other agricultural products processing does not go much beyond the
primary stage. Looking at the potential, food processing industry can grow at more than 20 per
cent per year. Accelerated development of food industry will not come by itself and would not be
qualitatively good unless positive steps are taken by all stakeholders. The Conference addressed
these issues and made the following recommendations.
1- Development of food industry necessitates effective networking and constructive
partnerships between industry and Government, agriculture and industry and industry and
research organizations. The Ministry of Food Processing Industries should set up a small
Committee with 10-12 members representing these interests to coordinate policies and
activities.
2- The starting point of food processing is the availability of right quality of agricultural raw
materials. Hence coordination with farmers in the use of seeds (including GMOs),
fertilizers (including fortified fertilizers), pesticides (including bio-pesticides), post
harvest handling of agricultural products etc. is extremely important.
3- Micronutrient deficiencies are widespread and a business model should be developed to
fortify foods. Food laws should be modified and Government should evolve guidelines
for fortificants to be used and the extent of fortification to be undertaken in any product
(as per cent of RDA)
4- Government had brought out a notification about nutrition labeling which is currently
under further review. The new draft notification will be open to public suggestions in the
light of which final legislation will be promulgated. Labels have to be clear, accurate,
truthful, scientific, consumer friendly and practical and give all essential information to
help consumer make his choice.
5- Foods should be healthy and nutritious. Hence:
(a) Limits should be set for trans-fats and encouragement given to the use of omega 3
fatty acids
(b)Fruits and vegetables contain important nutrients which have proved to reduce the
incidence of many non-communicable diseases like cancer, cvd, diabetes, cataract,

osteoporosis, etc. The food pyramid that prescribes ideal food intake composition should
be reconstructed keeping in view the importance of fruits and vegetables.
(c) Consumer education is vital. This is the responsibility of both the Government and
industry.
(d)Many new health foods like functional foods, nutraceuticals, pre and pro-biotics, etc.
have great health as also market potential. More research in novel foods is required to use
foods to improve health and prevent diseases.
6- Food safety is critical. In a globalised market food chain has become long and susceptible to
chemical and microbial contamination. Hence every factory should adopt appropriate food safety
risk management model including HACCP.
7- Use of radiation technologies should be more widespread and therefore necessary
infrastructure facilities established by public and private sectors at a number of centres.
Irradiation will also extend shelf life of products.
8- Packaging protects food from contamination and increases the shelf life of foods. Industry
should give close attention to new materials and methods of packaging as also storage of foods
keeping in view consumer convenience, consumer appeal and cost of packaging.
9- Use of right kind of enzymes improves quality, flavor, etc of fermented foods. It is necessary
to have regulation on the lines of Codex Alimentations for standards, methodology, etc. in the
use of enzymes.
10- New technologies like non-thermal technologies (including radiation technologies), CMI,
biotechnology, are already in commercial use by industry. The scope however is much larger and
should be explored.
11- Biotechnology has extensive applications and should receive greater attention of food
industry as also Government. To facilitate expanded use of this technology more investment in
agriculture biotechnology is necessary and, for this purpose, transparent science based regulation
needs to be adopted.
12- A futuristic technology with wide ranging applications for food industry is nanotechnology.
It will eventually be used to produce designer foods. The requisite capacity building facilities
should be in place to accelerate the use of nanotechnology in food processing.

8. CONCLUSION
The Summer Internship proved to be a great learning experience. It gave me practical
experience of working in a service organization dealing in Export. Theory is better explained
in classrooms whereas to get a first-hand experience of work you need to be in an
organization. All the theory taught in the classroom would not have found its meaning without
experience. Import-Export is a complex process, which cannot be understood until and unless
one has had a practical experience in this field.
The main component of this process is the opening up of the foreign trade Segment. Due
attention has been paid to enhance the Competitiveness of the domestic industry by increasing
efficiency by importing quality and cost‐effective inputs and technology. The objective is to
make exports grow faster and turn it into an engine of growth for the economy as a whole.
During this internship I learnt the export procedure and documentation of the food products. I
recognized the how minute errors can lead to cause the losses. Inaccurate or incomplete
documentation will result in serious financial and goodwill losses. Such losses can be
completely avoided by understanding clearly the documentation requirements of all
concerned parties and then meticulously planning to get the right documents in the right
numbers, at the right places and at the right time. I also learnt how customer feedback and
satisfaction play an important role in customer relationship management.
This was my first work experience in the field of International Trade. It helped me in
understanding the various types of documents and procedures involved in International Trade.
This experience will be very helpful for me in my future as it gave me a 360 degree
understanding of what is the export procedure and how documentation should be done.

9. BIBLIOGRAPHY
Books:
[1].EXPORT WHAT.WHERE.HOW, 43rd
(Nov. 09) edition, Anupam Publication, Based
on new foreign trade policy by Paras Ram.
[2].Research Methodology, Methods and Techniques, Second Revised Edition by C. R.
Kothari.
Websites:
[1].www.dgft.gov.in
[2].www.idexport.com
[3].www.weikfield.com
[4].www.wikipedia.com
[5].www.infodrive.com
[6].www.tradeindia.com

10.ANNEXURE

2. Consular Invoice

3. Packing List

4. Bill of Lading

5. Bill of Exchange

6. Export Declaration

7. Export Application

8. Shipping Document

SIP Report- Aman Agrawal

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