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Export of Silk (India)

A Project on

Submitted by:

(1) Bilal Waghmare (237)(2) Bob D’Penha (208) (3) Subramaniam Dasari (206)(4) Prabhakar Vishwakarma (235)(5) Amitkumar Khule (214)

Project Guide:Prof .Zeenal Thakkar

Ramanand Arya Dayanand Anglo Vedic College

Datar Colony, Bhandup (E)Mumbai- 400 052

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DECLARATION

We ‘HIGH FLIGHERS’ of Ramanand Arya D.A.V College of S.Y.B.M.S (4TH SEMESTER) hereby declare that we have completed the project on “EXPORT OF SILK (INDIA)”.

The information submitted is true and original to the best of our knowledge.

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ACKNOWLEDGEMENT

In modern complex trade, it demands many professionals to develop International trade, which needs more information than ever before. Their emphasis is on need to study such subject like Import & Export Policy. We hope this project work will be of considerable value to determine our knowledge in the field of export.

This is the best part of our project where we are given an opportunity to thank all the people who helped us directly or indirectly to complete our project.

Our special gratitude also goes to dearest our Professor Zeenal Thakkar who has given guidance, motivation, inspiration and support by encouraging us.

Lastly we would like to thank to all those who are directly or indirectly involved and helped us to complete our project.

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CONTENTS

SR.NO

TOPIC COVERED PAGE NO

1 EXECUTIVE SUMMARY 12 OBJECTIVE & METHODOLOGY 23 HISTORY 34 GLOBAL MARKET SHARE 45 ABOUT SILKWORM 5-66 SILK WHY? WHERE? 77 SILK TYPES 88 FAMOUS SILK CENTRE IN INDIA 9-109 CENTRAL SILK BOARD 1110 DEMAND AND SUPPLY OF SILK 1211 RESULT 13-1412 ITEM-WISE ANALYSIS 1513 COUNTRY WISE EXPORTS 16-1714 THE CHALLENGES OF INDIA &

PROSPECTS OF INDIA 1815 INDIA CAN BEAT CHINA 1916 EXPORT PROCEDURE AND

DOCUMENTATION20-24

17 EXPORT INCENTIVE/ASSISTANCE 25-2618 DESCRIPTIONS OF GOODS 27-2819 FINDINGS 2920 CONCLUSION 3021 VARIOUS BILLS FOR TRADING 31-35

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EXECUTIVE SUMMARY

The export marketing is getting more and more competitive day by day. This project is a study of “Indian Silk” which is a sensitive item. The export policies have a direct bearing on the domestic silk industry at large.

India is the 2nd largest producer and exporter of silk in the world after China. We also have very big domestic silk sarees market, which consumes 90% of the silk produced in India.

This project gives a brief idea about the export of silk: History of silk, how the silk get processed, export earnings through silk, different incentives/assistance given to the Indian silk exporter, different competitors of Indian silk in the world market and how India is safe in the 21st century.

Keeping the above in view, this project work covers the valuable information on Export of silk, given in various topics to the best of my knowledge and belief.

Let see the project in detail and understand the Indian silk market in the world context.

The developed markets going more towards eco-friendly textiles, natural fibre like silk can look-up with confidence in the years to come. In order to make use of these situations, India silk industry has to gear up itself to meet the future challenges ahead.

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OBJECTIVE

The main objective of choosing this subject is to know the contribution of India in the field of “SILK”.

The following are the objectives for making this project: -

To study the India’s contribution in the field of export. To know exactly what is the position of Indian silk in the

world market. To know what are the procedure for exporting the product

“Silk”. To know that Is India safe when the world textile trade have

been integrated into WTO rules and regulations since 2005 at the international level.

To know what type of assistance/incentives get to the Indian exporters.

METHODOLOGY

Following procedure have been adopted for making this project more effective after visiting the council and going through the topic about silk.

Surf the net and site to get the valuable information. Refer some of the book. As gone through some of the magazine like “SILKNET”. A conclusion has been derived from the project.

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HISTORY

Silk is one of the oldest known textile fibers.According to Chinese tradition, silk was used as long

ago as the 27th century BC. The silkworm moth was originally a native of China, and for about 30 centuries the gathering and weaving of silk was a secret process, known only to the Chinese. China successfully guarded the secret until AD 300, when Japan, and later India, penetrated the secrecy.

The ancient Persian courts used Chinese silks, unraveled and rewoven into Persian designs. When Darius III, king of Persia, surrendered to Alexander the Great, he was clothed in such silken splendor that Alexander was completely overshadowed and demanded as spoils the equivalent of $7 million in silk.

Silk became a valuable commodity in both Greece and Rome, until AD 550 all silk woven in Europe was derived from Asiatic sources. About that time, however, the Roman emperor Justinian I sent two Nestorian monks to China, where, at the risk of their lives, they stole mulberry seeds and silkworm eggs, secreted them in their walking staffs, and brought them to Byzantium.

Thus, the Chinese and Persian silk monopolies ended. With the spread of Islam, the silkworm came to Sicily and Spain. By the 12th and 13th centuries Italy had become the silk center of the West, but by the 17th century France was challenging Italy’s leadership. The silk looms established in the Lyons area at that time are still famous today for the unique beauty of their weaving.

The silkworm, however, did not flourish in the English climate, nor has it ever flourished in the U.S. The first silk mill in the U.S. was erected in 1810. With the advent of the power loom, and with the help of the high tariffs introduced during the American Civil War against imported woven goods, the American silk-weaving industry entered a period of growth.

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Global Market Share

YEAR: - 1994

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ABOUT SILKWORM

SILKWORM, common name for the silk-producing larvae of any of several species of moths. Silkworms possess a pair of specially modified salivary glands called silk glands, or sericteries, which are used in the production of cocoons. The silk

glands secrete a clear, viscous fluid that is forced through openings, called spinnerets, on the mouthparts of the larva; the fluid hardens as it comes into contact with air. The diameter of the spinneret determines the thickness of the silk thread produced.

The best-known silkworm is the larvae of the common, domesticated silkworm moth, Bombyx mori, of the family Bombycidae. This moth has been cultivated for many centuries and is no longer known in the wild state.

The female deposits 300 to 400 bluish eggs at a time; the eggs are fastened to a flat surface by a gummy substance secreted by the female. The larvae, which hatch in about ten days, are about 0.6 cm (about 0.25 in) long. The larvae feed on leaves of white mulberry, Osage orange, or lettuce. Silkworm caterpillars that are fed mulberry leaves produce the finest quality silk. Mature larvae are about 7.5 cm (about 3 in) long and yellowish gray or dark gray in color. About six weeks after hatching, the common silkworm stops eating and spins its cocoon. The length of the individual fiber composing the cocoon varies from 300 to 900 m (1000 to 3000 ft). The silkworm pupates for about two weeks; if allowed to complete its pupation period, it emerges as an adult moth.

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Tearing during emergence damages the silken cocoon beyond commercial use. Therefore, in the commercial production of silk, only enough adult moths are allowed to emerge to ensure continuation of the species. The rest are killed by heat. Other moths known as silkworm moths include the giant silkworm moths of the family Saturniidae, particularly of the genus Antheraea.

World Raw Silk Production:

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SILK- WHY?

Silk is a high value but low volume product accounting for only 0.2 % of world’s total textile production. Silk production is regarded as an important tool for economic development of a country as it is a labour intensive and high income generating industry that churns out value added products of economic importance. The developing countries rely on it for employment generation, especially in rural sector and also as a means to earn the foreign exchange.

SILK- WHERE?

Geographically, Asia is the main producer of silk in the world and produces over 90 % of the total global output. Though there are over 40 countries on the world map of silk, bulk of it is produced in China and India, followed by Japan, Brazil and Korea. China is the leading supplier of silk to the world with an annual production of 81880 MT (2000). Out of Which the Mulberry raw silk product is 78080 MT.

India is the second largest producer of silk and also the largest consumer of silk in the world. It has a strong tradition and culture bound domestic market of silk. In India, mulberry silk is produced mainly in the states of Karnataka, Andhra Pradesh, Tamil Nadu, Jammu & Kashmir and West Bengal, while the non-mulberry silks are produced in Jharkhand, Chattisgarh, Orissa and northeastern states.

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http://indiansilk.kar.nic.in/india.html

http://indiansilk.kar.nic.in/annual_production.html

http://indiansilk.kar.nic.in/annual_production.html


SILK- TYPES

There are four major types of silk of commercial importance, obtained from different species of silkworms which in turn feed on a number of food plants. These are:

MULBERY TASAR MUGA ERI

Except mulberry, other varieties of silks are generally termed as non-mulberry silks. India has the unique distinction of producing all these commercial varieties of silk.

MULBERRY: - The bulk of the commercial silk produced in the world comes from this variety and often silk generally refers to mulberry silk. Mulberry silk comes from the silkworm, Bombyx mori L that solely feeds on the leaves of mulberry plant. These

silkworms are completely domesticated and reared indoors. In India, the major mulberry silk producing states are Karnataka, Andhra Pradesh, West Bengal, Tamil Nadu and Jammu & Kashmir which together accounts for 92 % of country’s total mulberry raw silk production.

TASAR: - Tasar (Tussah) is copperish colour, coarse silk mainly used for furnishings and interiors. It is less lustrous than mulberry silk, but has its own feel and appeal.In India, tasar silk is mainly produced in the states of

Jharkhand, Chattisgarh and Orissa, besides Maharashtra, West Bengal and Andhra Pradesh. Tasar culture is the main stay for many a tribal community in India.

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ERI: - Eri silk is the product of the domesticated silkworm, Philosamia ricini that feeds mainly on castor leaves. Ericulture is a household activity practiced mainly for protein rich pupae, a delicacy for the tribal. Resultantly, the eri cocoons are open-mouthed and are spun. The silk is used indigenously

for preparation of chaddars (wraps) for own use by these tribals. In India, this culture is practiced mainly in the northeastern states and Assam. It is also found in Bihar, West Bengal and Orissa

MUGA: - This golden yellow colour silk is prerogative of India and the pride of Assam state. It is obtained from semi-domesticated multivoltine silkworm. These silkworms feed on the aromatic

leaves of Som and Soalu plants and are reared on trees similar to that of tasar.

Muga culture is specific to the state of Assam and an integral part of the tradition and culture of that state. The muga silk, and high value product is used in products like sarees, mekhalas, and chaddars, etc.

FAMOUS SILK CENTRE IN INDIA

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SILK SILK CENTRE

Andhra PradeshDharmavaram, Pochampalli, Venkatagiri, Narainpet

Assam SualkuchiBihar BhagalpurGujarat Surat, CambayJammu & Kashmir

Srinagar

KarnatakaBangalore, Anekal, Ilkal, Molakalmuru, Melkote, Kollegal

Chattisgarh Champa, Chanderi, RiggerMaharashtra Paithan

Tamil NaduKancheepuram, Arni, Salem, Kumbhakonam, Tanjavur

Uttar Pradesh VaranasiWest Bengal Bishnupur, Murshidabad, Birbhum

CENTRAL SILK BOARD

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Established in 1949 as a Commodity Board by Govt. of India, is a premier organization for overall development of sericulture and silk industry.Headquarters – Bangalore.

VISION

See India emerge as the leader in the world market for silk.

MANDATECSB is statutorily committed to: -

Promote the development of the silk industry by all appropriate measures, and for this purpose, in particular.

Undertake, assist and encourage scientific, technological and economic research in the silk sector.

Devise means to improve cultivation of mulberry plantations Produce and distribute healthy silkworm seed. Improve the quality and production of raw silk and the

marketing of silk Advice and report to Govt. of India on all matters relating to

the development of the raw silk industry, including the import and export of raw silk.

MISSION

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Make continuous efforts in Research and Development and Technology Transfer.

To create greater opportunities for gainful employment and improved levels of income in sericulture through spread of scientific sericulture practices.

To improve productivity in all stages of silk production Strengthen levels of efficiency through a commitment to

quality

SERVICES RENDERED BY CSB

EXPORT PROMOTION: -

Disseminate information on exports of Natural Silk Goods and Import of Raw Silk.

Guidance to New Entrepreneur Exporters on procedures and formalities.

Export and Import Policy relating to silk. Incentives offered by the Govt. of India against exports of

silk goods. Imparting technical knowledge on silk manufacturing.

DEMAND AND SUPPLY OF SILK

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Silk from time to time is immemorial is considered to be a symbol of luxury, elegance and sophistication. Being a natural fibre, with all its natural qualities, silk always remained in demand. From the royal wear to the present status of common man’s wear, the transition of silk took over a period of two millennium. Nevertheless, skill still has a special place in the Textile-kingdom as silk. Natural fibres, which are eco-friendly, have an increased preference over synthetics the world over especially in the developed market. Therefore there is an increased preference for textiles made out of natural fibres like silk in the developed markets. This trend is being noticed even in the developing markets too. Natural fibres therefore would sustain demand as ideal clothing materials even in the day to come.

India has an ancient silk culture right from the pre-vedics times. Silk has a sacred place in the cultural heritage of Indian. It is a tradition that in India no religious rituals will be complete without the use of silk. It is also a religious tradition for the bride to wear silk saree in the soledom occasion of their marriage irrespective of their economic condition. Silk industry in India therefore caters to the vast saree market round the year. The demand for raw silk by the saree industry is quite large. Thousands of weavers, with their tiny weaving establishments are located at the major weavings centres like Banaras, Mubarakpur, Kanjeepuram, Salem, Dharmavarm etc. they need raw silk to run their loom round the year.

India now produces around 15,000 metric tons of raw silk. According to a rough estimate, the demand for silk in India by both domestic and export sector is around 24,000 metric tons leaving a gap of around 9000 metric tons.

RESULT

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“SILK EXPORTS - AUGUST 2006”

TABLE-1: TOTAL EXPORT EARNINGS OF SILK ITEM(Value: Crore Rs. / Million US $)

Item wise exportsAugust % Increase /

Decrease2004 2005Rs. US$ Rs. US$ Rs. US$

Natural Silk Yarn, Fabrics, Made-up

156.9934.18 105.7921.77 48.4 57.0

Readymade Garments 37.01 8.06 43.58 8.97 -15.1 -10.2Silk Carpet 5.75 1.25 6.09 1.25 -5.6 -0.1Silk waste 0.00 0.00 1.52 0.32TOTAL 199.7543.49 156.9832.31 27.2 34.6

Item wise exports

April to August % Increase / Decrease2003-05 2002-04

Rs. US$ Rs. US$ Rs. US$Natural Silk Yarn, Fabrics, Made-up

671.68143.80588.58120.49 14.1 19.3

Readymade Garments 210.8245.13 264.0454.05 -20.2 2.0Silk Carpet 31.63 6.77 38.82 7.95 -18.5 -49.9Silk waste 1.83 0.40 8.42 1.72 -78.3 -60.0TOTAL 915.96196.10899.86184.21 1.8 -9.8

“ITEMWISE ANALYSIS”

Natural Silk Yarn, Fabrics, Made-ups :

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Natural Silk Yarn, Fabrics, Made-ups etc. account for 73.3% approximately to the total silk goods exports. During the period April to March of the year 2003-04, exports of these items touched 143.80 Mn. US$ (Rs. 671.68 crore) showing an increase of 19.3% in dollar terms (14.1% in rupees terms) as compared to corresponding period of the year 2002-03 i.e., 120.49 Mn. US$ (Rs. 588.58 crore). The major importing countries were U.S.A., Hong Kong, U.K. U.A.E., Italy, German, Spain, Saudi Arabia, France and Singapore.

Ready-made Garments:

Ready-made Garments account for 23.0% approximately to the total silk goods exports. They are also high value-added items. Ready-made Garments recorded an export earnings of 45.13 Mn. US $ (Rs. 210.82 crore) during the period, April to August for the year 2003-04 indicating a increase of 16.5% in dollar terms (20.20% in rupee terms), when compared to the same period of the year 2002-03 which was 54.05 Mn. US$ (Rs. 264.04 crore).

The major importing countries were U.S.A., U.K., U.A.E., Hong Kong, German P Rep, France, Italy, Saudi Africa, and U.S.S.R., Indonesia.

Silk Carpets:

Silk Carpet account for3.5% approximately to the total silk goods exports. This segment recorded export earnings of 6.77

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Mn. US$ (Rs. 31.63 crore) during the period April to August of the year 2004-05 indicating a decrease of 14.8% in dollar terms (18.5% in rupee terms), when compared to the same period of the year 2003-04 which was 7.95 Mn. US$ (Rs. 38.82 crore). The Major importing countries are U.S.A., German P Rep, Oman, U.K., France, Australia, Saudi Arabia, U.A.E., Canada and Singapore.

Silk Waste:

Silk waste, which is the raw material for the spun silk is also exported in large quantities. Silkwaste export was very high in the last few years. However, this year, there is a significant decline. The decline of silk waste export was 77.3% in dollar terms (78.3% in rupee terms), amounting to 0.40 Mn. US$ (Rs. 1.83 crore) during the period of April to August of the year 2003-04 compared to 1.72 Mn.US$ (Rs. 8.42 crore) for the same period in the year 2002-03.The major importing countries are Thailand, China Rep, Italy, Spain and U.A.E.

Export of silk waste and its by-products during April to August period of the year 2003-04 compared to the corresponding period of the year 2002-03 are shown in Table – 2

TABLE -2: EXPORT OF SILKWASTEPeriod Quantity Value(April to August) (MT) (Crore Rs.) (Mn. US $)2004-05 94.698 1.83 0.402003-04 481.818 8.42 1.72

“COUNTRY WISE EXPORTS”

USA, U.K., German P Rep, U.A.E and Hong Kong are the top five countries importing Indian silk goods in value terms during April to August period of the year 2004-05 and accounted

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for 35.2%, 7.6%, 6.0% and 5.2% respectively of total export earnings. They altogether accounted for 117.81 mn. US$ (Rs. 550.31 crore) which was 60.1% of total export earnings of 196.10 Mn. US$ (Rs. 915.96 crore) during the period. The country wise silk export earnings during April to August period of the year 2003-04 along with the data of corresponding period of the year 2003-04 are shown in Table-3

TABLE - 3: COUNTRYWISE SILK EXPORT EARNINGS(Value: Crore Rs. / Million US $)

COUNTRYAPRIL TO AUGUST

COUNTRY SHARE

2004-05 2003-04 2003-04 2002-03Rs. US$ Rs. US$ % %

U.S.A 322.4069.02 313.8564.25 35.2 34.9U.K 69.99 14.98 74.72 15.30 7.6 8.3GERMAN P REP

55.15 11.81 62.42 12.78 6.0 6.9

U.A.E. 55.12 11.80 55.22 11.30 6.0 6.1HONG KONG 47.65 10.20 48.18 9.86 5.2 5.4ITALY 40.92 8.76 40.51 8.29 4.5 4.5SINGAPORE 33.70 7.21 14.60 2.99 3.7 1.6SPAIN 30.33 6.49 23.69 4.85 3.3 2.6FRANCE 24.77 5.30 33.62 6.88 2.7 3.7SAUDI ARABIA

23.14 4.95 30.91 6.33 2.5 3.4

OTHERS 212.8045.56 202.1441.38 23.2 22.5TOTAL 915.96196.10899.86184.21100.00 100.00+ Refers to top 10 importing countries.

THE CHALLENGES AND PROSPECTS OF INDIAN SILK INDUSTRY

‘Indian Silk Industry: A Sector Study’ was done by the Exim bank and released at the hands of Mr. Joy Oommen, Member

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Secretary and CEO, Central Silk Board. The Study highlights the prospects for the Indian silk industry, both from supply and demand sides.

On the supply side, rapid industrialization in China and Republic of Korea would open more export opportunities for India, as these countries are likely to reduce land allocation for sericulture practice. On the demand side, the Study identifies that, apart from expected growth in developed countries, developing countries of Asia are also showing an increasing interest in silk products.

Besides, in the WTO arena, reduction in the present high import tariff level for silk in developed country markets would provide export opportunities for Indian silk exporters. India is the world’s second largest producer of raw silk after China. India’s share of 19 percent of global production, however, is much lower than the 75 percent share of China. At the same time, there is a large import demand for raw silk in India for manufacturing value added silk products catering to export demand.

The Study is part of endeavor to enhance the competitiveness of Indian exporters. The efforts taken by Central Silk Board on improving the productivity and quality of Indian silk in order to compete in the international markets.

Silk exports, the Study delineates, account for 1.2 percent share in total Indian exports and 4.4 percent share in total textile exports in 2000-01. Silk exports reached a record level of US $ 530 million in the year 2000-01.

Over 50 percent of silk exports are in the form of fabrics including dress materials, while silk garments account for 24 percent and silk made-ups account for 13 percent. USA is the major importer of silk, followed by the European Union and Japan.

Eco-friendly packaging is another aspect that has to be addressed while exporting to the sensitive markets. International

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campaign for promotion of silk products, product diversification, exclusive brand promotion, and image building of silk as comfort clothing are other elements of the export strategy.

INDIA CAN BEAT CHINA IN SILK PRODUCTION

Chinese silk is heavy is useful only for pillow covers and bed spreads and not for attires where as Indian silk which is soft and light is for dress materials. In India the silk products are

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being produced which is affordable even to the poor and the lower middles class people.

Karnataka is catering to the 60 per cent of the national demand and all round efforts are being made reach to higher reach. Karnataka government has agreed to amend the Sericulture Marketing Act to remove control on sale of cocoon and yarn. “The Center is eager in this regard and the amendment will be done in the next session of the legislature.

A situation is developing in China where silk production is coming down on account of diversification to other crops while domestic consumption is increasing. “India would like to exploit this situation by going in for massive production of the quality silk.

The exhibition which is the first of its kind in India has brought together researchers, development and promotion agencies, central and state organizations, silk handloom cooperatives, self-help groups, traders and exporters.

EXPORT PROCEDURE AND DOCUMENTATION

1. REGISTRATION STAGE: -

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Deciding the nature of the business : - The exporter must have to decide the nature of the business. His choice will be one of the following:

Sole proprietor business. Partnership firm. Joint stock company.

Opening of bank account : - An exporter has to select a bank, which undertakes to fulfill all banking formalities connected with negotiation of documents and realization of export proceeds. The bank must be authorized to deal with “Foreign Exchange”.

Registrated with the Shop and Establishment Act : The exporter has to registrated under this act and gets the registrated “License Number”.

Obtaining code number from DGFT : - This is another

formality, which every exporter has to complete without which he cannot export any commodity. The code number is known as “Importer-Exporter Code (IEC) Number”. This code no. is granted by “DGFT (Director General of Foreign Trade)”.

Registration with the Silk Export Promotion Council : - The exporter is required to register his firm with the “Indian Silk Export Promotion Council” for securing various benefits under the Import Export Policy.

Obtaining GIR No./PAN No : - Income from export is exempted from income tax for which he is required to register his firm with “Income Tax Authority”. For this purposes he has to first get the GIR No./PAN No.

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Obtaining Sales Tax Number : - The exporter has to apply to the sales tax authority for getting “Sales Tax Registration” number. It is compulsory to get the benefit of sales tax exemption.

2. PRE-SHIPMENT STAGE: - Sampling and Correspondence : - Before confirming the order

the seller send the sample of the silk material and correspondence with the prospective buyer on the “terms and conditions” of the order.

Obtaining the confirmed order : - When the overseas buyer accepts the exporter offer or the invoice, he sends a confirmed order called “Indent” to the exporter. The exporter should check foreign exchange regulations of the importer countries.

Obtaining a confirmed Letter of Credit : - Together with the

confirmed letter order the exporter may send a formal letter to the buyer or importer to open a “Letter of Credit” in his name.

Preshipment finance : - As soon as the exporter gets the letter of credit; he should approach his bank for securing “Preshipment finance”.

Production/Procurement of Goods : - The exporter has to arrange for production of goods as soon as he gets the “Preshipment finance” from the banks.

Packing and Marking : - The exporter has to arrange for proper packing and marking of the goods. It must ensure proper protection of the goods and quality of the packing

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material. If necessary, the exporter can take the assistance from the “Indian Institute of Packing (IIP)”.

Silk-pre-shipment inspection : - Exporters will bring the consignments of silk to the customs point. For each consignment, an application for pre-shipment inspection in prescribed forms of “Central Silk Board (CSB)” will be made accompanied by two copies of export invoices, two packing lists and a sample swatch of 6" square dimension.

Appointment of C&F agents : - Dispatch of goods from India to foreign countries is a technical job which the exporter require the service of “C&F” agents. C&F agent ensures smooth clearance of goods from the customs and collection of negotiable documents.

3. SHIPMENT STAGE: - Arrangements of Internal transport from factory warehouse to

the port of shipment: - The exporter has to make necessary arrangements for “transporting of goods” by rail or roads way from his place to the port of shipment.

Preparation and Processing of Shipping Documents : - when the goods reach the port of shipment, the exporter has to arrange for preparation of a complete set of documents. The following documents must be submitted to the “Custom Appraiser at the Custom House”.

Export of Silk (India) Commercial Invoice (ANNEXURE -1) Packing List or Packing Note (ANNEXURE -2) Warehouse Receipt (ANNEXURE -4)

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Mate’s Receipt (ANNEXURE -5) Letter of Credit Shipping Bill (ANNEXURE –7) Marine Insurance Policy. Proforma Invoice Central Excise Custom Procedure take Place – During First CSB Inspection

4. POST-SHIPMENT STAGE: - Submission of Documents by the Agents to the Exporter : -

The C&F agents submit the necessary documents to the exporter to enable him to present the same to his bank for the purpose of negotiation.

Shipment Advice to Importer : - After the shipment of goods, the exporter has to send suitable intimation to the importer for his information it include detail like date of shipment, name of the vessel, date on which goods will reach the destination etc.

Presentation of Documents to the Bank for negotiation: - A complete set of documents is submitted by the exporter to his bank for the purpose of negotiating the same and obtaining export proceeds for the same. The following documents are to be submitted and they are: -

Bill of Exchange (ANNEXURE -3) Commercial Invoice Bill of Lading (ANNEXURE -6) Marine Insurance Policy Certificate of Origin and Consular Invoice Processing of GR Form : - When the negotiating bank has

received payments, it will record on the duplicate copy of the GR Formand forward it to the RBI. When they are found to be alright the transactions is treated closed because the

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required foreign exchange payment has already been received.

EXPORT INCENTIVES/ASSISTANCE:

Government of India offers various incentives and facilities to Indian exporters in order to encourage and support the

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export efforts, as the foreign exchange earned through exports is vital to the country at a time of its adverse balance of payment position. There are monetary as well as non-monetary incentives. Exporters are provided with various export incentives/assistance under different Export Promotion Schemes. The following of them are listed:

Exemption from Income Tax : -The single biggest incentive that an exporter now enjoys is the exemption from income tax. Export earnings were not subjected to income tax under section 80-HHC. But from the year 2000-01, this benefit is being phased out in 5 years time.

Duty Free REP:(DFRC ): - All silk exporters can avail of the benefits under this scheme for the grant of Replenishment license for import of raw silk free for custom duty on post export basis.

Other Assistance: - Exporters are also made available other assistance and facilities to encourage exports such as excise duty rebate, exemption from sales tax, Rail/ Ocean/ Air Freight concession. MDA, Pre-shipment and post-shipment finance from banks at low interest, ECGC etc.

Duty Drawback : - Exporters who are not availing benefits under DEEC or DEPB scheme can claim Duty Drawback “NEW DRAWBACK RATES FOR SILK ITEMS”. The Government has notified the new Duty Drawback Rates vide Notification No. 12/2004 Customs (N.T.) Dated 29th January 2004. The Drawback Notification comes into effect from 9th

February 2004.

Sr.No SubSr.No.

Description of goods Rates of drawbacks Allocation

1. Fabrics made out of natural silk other than

Rs. 86.00 (Rs. eighty six only) per kg of silk

All Custom

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made of Noil Silk Yarn. content2. Fabrics made of Noil

Silk YarnRs. 24.50 (Rs. Twenty four and fifty paise only) per kg of silk content.

All Custom

3. Readymade Garments made wholly or mainly of natural silk other than made of Noil Silk Yarn

Rs. 86.00 (Rs. eighty six only) per kg of silk content.

All Custom

4. Readymade Garments made wholly or mainly of Noil Silk Yarn.

Rs. 24.50 (Rs. Twenty four and fifty paise only) per kg of silk content.

All Custom

5. High fashioned Readymade Garments made wholly or mainly of natural silk other than made of Noil Silk Yarn


All Custom

6. High fashioned Readymade Garments made wholly or mainly of Noil Silk Yarn


All Custom

7. Handloom / Power loom Lungies (including Lungies commonly known as Sungits) made of natural silk other than made of Noil Silk Yarn


All Custom

8. Handloom / Power loom Lungies (including Lungies commonly known as Sungits) made of Noil


All Custom

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Silk Yarn9. Made-up articles made

out of fabrics made wholly or mainly of natural silk other than made of Noil Silk Yarn.


All Custom

10. Made-up articles made out of fabrics made wholly or mainly of Noil Silk Yarn


All Custom

Duty Entitlement Pass Book (DEPB ): - The objective of the DEPB scheme is to neutralize the basic custom duty on the import content of the export product by granting duty credit against export. Duty credit is calculated taking into account the deemed import content of the export product as per the Standard Input Output Norms and determine the basic custom duty payable on the import content. Export credit is fixed as a % of FOB value for exports which are as follow: -

ITEM %SILK FABRICS 6SILK MADEUPS 7SILK GARMENTS 8

FINDINGS????

After doing this project we came to know that what is the demand and supply of the silk products in the world markets and

32


what the response of the marketers. And how India is facing the challenges of foreign markets. The following are the findings: -

Increasing silk productivity and adhering to international quality are two important requirements for penetrating into developed country markets.

Indian silk export awaits a bright future in the day to come. At a time when Japan the giant silk producers of yesteryears, heavily downsizing its production due to migration of sericulture labour to more greener pastures like the electronic industry. There are various kinds of tariff and non-tariff barriers coming in the way of Indian textiles exports today. All these hurdles are expected to clear off when the world textile trade will be integrated into “WTO” rules and regulation disciplined by January 2005. In the recent part, a bit more liberal approach has been adopted in the silk import policy by accounting raw silk import under Duty Free Replenishment Schemes.

The Silk promotion circulates different type of magazine in the markets to know the market condition and the market price and some of the magazines are: - “FAIDA” contains a column on ‘Tips, Tricks and Traps in e-commerce’ (free weekly journal).

Despite the feel good factor in India shinning campaigns are impressive, for exporters who are already suffering because of dollar depressions as high as 10% from the last year levels, the reduction in Duty Drawback and DEPB has come as a blow, although not totally unexpected.

CONCLUSION

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http://www.infobanc.com/tradform.htm


It was pleasant experience while doing this project. As this project deal with the Export of Silk (India). My main objective of doing this project was to know the condition of Indian silk exporter in the world market and where the India stands in it.After doing this project I come to know how Indian silk play a crucial role in strengthing the Indian economy. This project comments that India is the 2nd largest producer of silk in the world after China. India is going to have a bright future in the year to come.

It is said that “SILK IS ALWAYS IRONED ON THE REVERSE SIDE WHEN STILL DAMP”. Silk is hallmarked by its natural imperfections. Nature is enhanced by the delightful imperfections in silk. The export of silk material is good as compared to other country.There are various kinds of tariff and non-tariff barriers coming in the way of Indian textiles exports and all these hurdles are cleared off as the world textile trade had been integrated into “WTO” rules and regulation disciplined since January 2005

Sericulture provides labour intensive and agro-based cottage industries providing gainful employment to about 6.5 million people in the rural and semi-urban areas. We have various type of authority like CSB, Silk Export Promotion Council they are contributing a lot to the export of silk. The National Silkworm Seed Project (NSSP) has been entrusted by the CSB with the responsibility of production of quality silkworm seed. They also provide various type of training; extension and seed support to the sector also certifies the quality of silk goods export. “With time and patience, the mulberry leaf turns into stain”.

The exporter gets various type of incentive like “DEPB, DERC, DUTY DRAWBACK SCHEME, & OTHER ASSISTANCE”. This is one of the motivating factors given to the exporter to get more foreign exchange.

Exporter Invoice No. & Date Exporter’s Ref.

Buyer’s Order No. & Date

34


Other Reference(s)

Consignee Buyer (if other than consignee)

Country of Origin of Goods

INDIA

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 Place of Delivery

Marks & Nos./

Container No.

No. & Kind of pkgs

Description of Goods Quantity Rate Amount

Amount Chargeable(In words)

Total

DECLARATION:

We declare that this invoice shows the actual price of the goods described and that all particulars are true and correct.

Signature & Date For

Authorized Signatory

INVOICE

Exporter Invoice No. & Date Exporter’s Ref.


35


Other Reference(s)


Country of Origin of Goods

INDIA

Country of Final

Destination

Terms of Delivery and Payment




Marks & Nos./

Container No.

No. & Kind of pkgs

Description of Goods Quantity Rate Amount

Amount Chargeable(In words)

Total

DECLARATION:

We declare that this invoice shows the actual price of the goods described and that all particulars are true and correct.



INVOICE

Exporter Invoice No. & Date


36


Other Reference(s)


Country of Origin of

Goods

INDIA

Country of Final Destination




Marks & Nos./ No. & Kind of pkgs Description of Goods

Container No.

Quantity Remarks



PACKING LIST

BILL OF EXCHANGE

37


VALUE DATE

PAY THIS FIRST (SECOND UNPAID) BILL OF EXCHANGE

TO THE ORDERS OF

THE SUM OF

AGAINST INVOICE NO

DATED

DRAWN ON FOR

AUTHORISED SIGNATORY

BILL OF LADING

BL NO.

REF. NO.

Shipper

Consignee

Notify Address

Pre carriage by Place receipt

Vessel Port of loading

Port of Discharge

Item Description Weight Measurement

38


Particulars given by the exporterFreight details

Charges etc.

Freight payable at Place and date of Issue

No. of original B/L

Signature

39


MATE’S RECEIPT

WAREHOUSE RECEIPT

SHIPPING COMPANY

DATE

Received in good order and condition on board the for

. The under mentioned goods from .

Item Description Weight Length Marks

This receipt is to be exchanged for company’s Bill of Lading.

Signature

(Mates)

40


WARHOUSE COMPANY

STORAGE INTIMATION

NO. DATE:

M/S.

Sr.No. Particulars Nos. Weight Lorry No. Remarks

N.B. FOR1) Weight and Quantity not checked by us.2) We are not responsible for any shortage

and damaged of the material.Godown in charge/ M.

SHIPPING BILL

41


SHIPPING BILL Signature

FOR GOODS UNDER CLAIM FOR DRAWBACK

Port Bombay Exporter’s Name Address

Name of Vessel Master of

Agents

Colour Port at which goods to be dispatched

Remarks

Packages Details of goods to be given separately for each class or Description

Number &

Descriptions

in words

and figures

Marks &

Number

Quantity Descriptions

of Goods

Value No. and

date of

duty

bill

Amt of

Drawba

ck

Country of

final

DestinationsUnit Amt Rate Amt

Entered No. Let Export under I/We hereby declare that the parti-

Rotation No Preventive Supervision culars given above to be true.

I/We claim the usual drawback on

the abovementioned goods.

Assistant Collector of Customs Signature of the exporter or his Authorized

Agents

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pr

Documents

major importing

2nd largest

tariff barriers

noil silk

world textile

fifty paise

indian silk

central silk