Q.2:- Your firm is planning to import textile machinery from Canada. Describe the procedure involved in importing.
Following is the procedure involved in importing textile machinery from Canada
(i) Trade Enquiry The importing firm approaches the textile machinery export firms in Canada with the help of trade enquiry they collecting information about their export prices and terms of exports. After receiving a trade enquiry, the exporter will prepare a quotation called proforma invoice and send it to our firm.
(ii) Procurement of Import License We will consult the Export Import (EXIM) policy in force to know whether the textile machinery imports are subject to import licensing. In case it can be imported only against the licence, we will procure an import licence.
(iii) Obtaining Foreign Exchange As payment for imports will be made in Canadian dollars, our firm will have to make an application to a bank authorized by RBI to issue foreign exchange.
(iv) Placing Order or Indent After obtaining the import licence, our firm will place an import order or indent with the exporter for supply of the specified products containing information about the price, quantity, grade and quality of machinery and the instructions relating to packing, shipping, ports of shipment and destination, delivery schedule, insurance and mode of payment.
(v) Obtaining Letter of Credit If the payment terms agreed between us and the overseas supplier then our firm should obtain the letter of credit from its bank and forward it to the overseas supplier.
(vi) Arranging for Finance Our firm would make arrangements in advance to pay to the exporter on arrival of goods at the port.
(vii) Receipt of Shipment Advice After loading the ordered textile machinery on the vessel, the overseas supplier will dispatch the shipment advice to our firm which contains information about the shipment of goods.
(viii) Retirement of Import Documents After shipping the machinery, the overseas supplier will prepare a set of necessary documents including bill of exchange, commercial invoice, bill of lading/airway bill, packing list, certificate of origin, marine insurance policy, etc. and will hand it over to his or her banker for their onward transmission and negotiation to our firm. The acceptance of bill of exchange for the purpose of getting delivery of the documents is known as retirement of import documents after which the bank handover the import documents to the importer.
(ix) Arrival of Goods Goods will be shipped by the overseas supplier as per the contract. The officer in charge at the dock will provide the document called import general manifest on the basis of which unloading of cargo will take place.
(x) Customs Clearance and Release of Goods Textile machinery imported into India will have to pass through customs clearance. Firstly, our firm will have to obtain a delivery order, pay dock dues and obtain port trust dues receipt and then fill in a form hill of entry’ for assessment of customs import duty. After payment of the import duty, the bill of entry has to be presented to the dock superintendent. The examiner will give his report on the bill of entry and we will present the bill of entry to the port authority who will issue the release order after receiving necessary charges.