The export of goods and services is an essential aspect of international trade, and India has a robust framework that governs exports. The export process involves multiple steps, legal requirements, and compliance with various regulations under Indian law, including Foreign Trade Policy (FTP), Foreign Exchange Management Act (FEMA), and other relevant laws.

Here’s a detailed overview of the process, key guidelines, and compliance requirements for the export of goods and services from India:

1. Export of Goods from India

a. Key Requirements for Exporting Goods

To export goods from India, an exporter must meet the following essential requirements:

• Exporter Registration:
  • Import Export Code (IEC): Every exporter must obtain an IEC number from the Directorate General of Foreign Trade (DGFT). This is a unique 10-digit code required for exports and imports in India.
  • Goods and Services Tax (GST): Exporters must be registered under the GST Act for export of goods, as exports are treated as zero-rated supplies under GST.
  • Exporter Profile Registration: Registration with the DGFT or relevant authorities may be required for specific goods and services.
• Shipping and Export Documentation:
  • Shipping Bill: A shipping bill must be filed with Customs to export goods. It is the key document for customs clearance.
  • Invoice: A commercial invoice is necessary for the sale of goods, indicating the price and terms of sale.
  • Packing List: Provides details of the shipment’s contents, packaging, and weight.
  • Certificate of Origin: Some countries require a certificate of origin, which confirms the country where the goods are produced.
  • Bill of Lading: The shipping document that confirms receipt of the goods by the carrier and is required to claim the shipment.
  • Letter of Credit (LC): Sometimes, a letter of credit is used for payment protection.
• Customs Compliance:
  • Goods are subject to Customs Clearance before export, and all duties (if any) must be cleared.
  • Customs Declaration: The exporter must submit a declaration to customs, which includes a detailed description of the goods being exported, their value, and any applicable duties or taxes.
• Export Documentation Process:
  • Customs Exam: Goods are examined by customs to check compliance with export regulations and documentation.
  • Customs Duty: Customs duty exemptions may be available under specific schemes like MEIS (Merchandise Exports from India Scheme) and SEIS (Services Exports from India Scheme).
  • Export Promotion Schemes: Various government schemes exist to promote exports, such as Duty Drawback, Export Credit Guarantee Scheme, and others.
• Payment and Repatriation of Funds:
  • Foreign Currency: Payments for export must be received in foreign currency or through a foreign currency account.
  • Repatriation of Export Proceeds: Export proceeds should be repatriated to India within a specific period (usually within 9 months from the date of export), and exporters must comply with FEMA guidelines.

b. Export Incentives and Schemes

The Government of India offers various schemes to promote exports and provide incentives to exporters:

• Merchandise Exports from India Scheme (MEIS): Provides duty credit scrips to exporters based on the value of goods exported.
• Services Exports from India Scheme (SEIS): Offers duty credit scrips for service exports, such as IT, legal services, and tourism.
• Duty Drawback Scheme: Allows exporters to claim a refund of customs duties paid on imported materials used in manufacturing exported goods.
• Interest Equalization Scheme: Offers financial support to exporters to make their goods competitive in the international market by subsidizing interest on export credit.

2. Export of Services from India

a. Key Requirements for Exporting Services

India offers a growing service export sector, including IT services, consulting, education, healthcare, tourism, and more. Exporting services requires compliance with the following:

• Exporter Registration:
  • IEC (Import Export Code): Service exporters, like goods exporters, must have an IEC number issued by DGFT.
  • GST Registration: Service exporters must be registered under GST, as services are zero-rated under GST for export.
• Service Export Documentation:
  • Invoice: An invoice must detail the service provided, the value of the service, and the terms of payment.
  • Contract/Agreement: A contract or agreement between the exporter and foreign client outlining the scope, payment terms, and duration.
  • Bank Payment Details: As services are typically paid for electronically, exporters must provide payment details via bank statements and proof of remittance in foreign currency.
• Repatriation of Export Proceeds:
  • Exporters must ensure that payment for services is received in foreign currency within the prescribed period (typically 9 months) from the date of export.
  • Payments should be credited to a foreign currency account, and exporters must ensure that the funds are repatriated to India in compliance with FEMA regulations.

b. Export of Specific Services

• Software and IT Services: India is a global leader in IT and software services. The export of IT services is a key part of India’s economy. Exporters in this category must follow standard procedures, including compliance with SEIS and FEMA guidelines.
• Tourism and Hospitality: Services related to tourism, such as travel arrangements, hotel bookings, and other services, can be exported. Payment is generally received in foreign currency, and service providers need to comply with GST regulations.
• Education and Healthcare: Institutions offering education and healthcare services to foreign students or patients must ensure that their services qualify as exports, under the Services Exports from India Scheme (SEIS).

c. Export Documentation for Services:

• Invoices (as mentioned above).
• Contract/Agreement.
• Payments in Foreign Currency: Evidence that the service has been paid for in foreign currency.

d. Incentives for Service Exports:

India has implemented various schemes under the Foreign Trade Policy (FTP) to encourage and support the export of services:

• SEIS (Services Exports from India Scheme): Provides duty credit scrips to service exporters.
• Interest Equalization Scheme: Offers financial assistance to exporters by subsidizing the interest on export credit.

3. Key Compliance Requirements for Exporters

• Foreign Trade Policy (FTP): The FTP outlines the procedures, incentives, and legal frameworks for Indian exports. It is updated periodically and provides a roadmap for exporters.
• Customs Compliance: Exporters must comply with Customs regulations, including the Customs Act, 1962, and Customs Tariff Act, which govern the procedures for customs clearance, duty exemptions, and refunds.
• FEMA (Foreign Exchange Management Act): Exporters must comply with FEMA guidelines for the repatriation of export proceeds. It specifies the timelines for repatriating foreign exchange and other details related to transactions.
• GST Compliance: Exporters must ensure that they comply with GST rules for export transactions, including maintaining proper documentation for zero-rated exports and obtaining refunds for input tax credits.

4. Export Procedures

The key steps involved in exporting goods and services from India typically follow this process:

1. Register as an Exporter: Obtain IEC and GST registration.
2. Market Research and Finding Buyers: Identify international buyers and markets for your goods or services.
3. Prepare Export Documentation: Prepare invoices, contracts, shipping documents, and other required paperwork.
4. Customs Clearance: Clear customs and ensure compliance with all regulations.
5. Shipment of Goods: Arrange transportation (air, sea, or land) for goods.
6. Receive Payment: Ensure payment in foreign currency through proper banking channels and comply with FEMA.
7. Repatriation of Export Proceeds: Ensure the repatriation of export earnings to India within the specified time frame.

Conclusion

Exporting goods and services from India involves compliance with a variety of regulations, including obtaining IEC, registering under GST, and ensuring adherence to FEMA rules. The process involves preparation of detailed documentation, customs clearance, and ensuring timely repatriation of foreign currency earnings. The Indian government offers various incentives and schemes to promote exports, including MEIS, SEIS, and Duty Drawback, aimed at reducing export costs and promoting competitiveness in international markets.

For specific guidance on export compliance, legal requirements, or export documentation, it is recommended to consult with export consultants, DGFT, or customs professionals.