Trade Documentation
How to Become an Exporter in India? A Complete Guide
Being an exporter can be a profitable and exciting prospect, one that will have you excited on the one hand and anxious on the other. There are many incentives and schemes available to you, as well as some processes you must follow to ensure compliance.
Before learning how to become an exporter in India, you must become used to terms like freight on board, inward remittance, bill of lading, FIRC, foreign currency conversion, and regulations of the country you are exporting to, among other bank-related processes. Plus, many portals, forums, and government-sponsored schemes will help you stay profitable and ahead of the competition.
Here’s a simple and comprehensive guide to becoming an exporter from India:
Start with research of your product or service
Our guide asks you to focus on two aspects in this regard: your expertise in producing or procuring the product or service and whether the product is viable for export. You must focus on the cost of the product, the continued supply of raw materials, applicable quality standards, and the sustainability of the business concept. To glean profitability, factor in overhead costs like administration, transportation, and other factors.
Understand the demand for your product globally
Start by conducting general research on your target market to understand the demand for the product and the existing competition. For updated information on this aspect, you can seek help from agencies like the IIFT (Indian Institute of Foreign Trade). Connect with agencies like the DGFT, Export Promotion Council, Department of Commerce, etc., to understand what is involved in the export process.
Start the registration process for your business
This could involve the type of business structure you want, such as a partnership, private limited company, sole proprietorship, etc. This will depend on your business funding and investors. Once this is decided, register the business, get a PAN number, and complete GST registration. Set up a current bank account for your banking transactions. Ensure you have a structure for authorized signatories with the bank to ensure that all financial transactions occur quickly.
Get the export-related documentation going
The starting point becoming an Indian exporter starts by applying for an Import-Export Code (IEC), which is mandatory for exporters of goods and services. This must be done through the Directorate General of Foreign Trade, which has an online portal. You will need to understand the inward remittance process, familiarize yourself with the export declaration form, and access a guide to the IEC registration process.
Complete export obligations
Register your business with export promotion councils like FIEO and APEDA to get product-specific benefits. Ensure your business is also part of the Export Data Processing and Monitoring System (EDPMS) to ensure you comply with all export-related inward remittances, have clearance for bills raised, and get the related benefits. Take the time and help your team become familiar with customs clearance processes and other Indian export regulations.
Start looking for international buyers
You will realize the process for becoming an Indian exporter has various steps that need to start in tandem. You can look for international buyers either in your circle, seek help from export promotion organizations, participate in trade fairs, and run online marketing campaigns on platforms that are relevant to your target country. Have your bank check the credentials of the buyer via their bank to minimize the risk of non-payment.
Get down to financing and logistics options
As an exporter, besides the costing and quality of your product, the factors that matter the most are reliability and sustainability on your path to how to become an Indian exporter. These two factors require solid financial support and a reliable and economical logistics partner. Research both these aspects to finalize the right option. Train your team to become experts at export incentives-related paperwork like GST relief or refund of VAT on certain expenses to ensure you realize these benefits on time. Talk to your bank to arrange bill discounting or other finance options.
Plan for long-term but launch slow
As the export business can pose many challenges, it is prudent for you to plan long-term but start with smaller steps in the beginning until your business finds its footing. When you explore the process of how to become an Indian exporter, there can be a learning curve to learn about the nuances of the export trade and it is prudent to start slow and move on to bigger horizons once you are established.
As you can see, the export business is full of risks and rewards but for some critical aspects like trade finance, inward remittance platform, and document-related issues, you can get support from LeRemitt. We specialize in providing innovative and economical solutions to exporters. Click here to learn more.
