Export trade involves selling goods and services to foreign countries. These days every country’ has to buy certain commodities from other countries. In order to make payment to foreign countries, a nation requires foreign exchange.
Therefore, a country must export and earn foreign exchange. Developing countries like India require considerable foreign exchange to pay for its imports.
Government of India has taken several steps to encourage and promote exports. Several cash, credit and tax benefits are provided to exporters. Exemptions from customs duty, transport concessions, cheap finance, supply of scarce raw materials, etc. are other types of assistance available to exporters.
Trade delegations are sent abroad to explore export potential. Bilateral trade arrangements are made with foreign countries to promote exports. Trade fairs and exhibitions are organised for the same purpose.
The Government of India has established several institutions for promoting exports. Some of these institutions are given below:
1. Export Promotion Councils
2. Export Inspection council
3. Commodity Boards
4. The Board of Trade
5. Indians Trade Promotion Organisation
6. Indian Institute of Foreign Trade
7. The Federation of Indian Export Organisations (F.I.E.O)
8. Directorate of Exhibitions and Commercial Publicity
9. Export Credit and Guarantee Corporation (E.C.G.C.)
10. State Trading Corporation (S.T.C.)
11. Minerals and Metals Trading Corporation (M.M.T.C.)
In addition, Export – Import (EXIM) Bank of India was established as a specialised financial institution for promoting exports. The main objective of the Exim Bank is to coordinate the activities of various institutions engaged in financing foreign trade.