INSTITUTIONAL

INFRASTRUCTURE
FOR EXPORT
PROMOTION
BY:PRASHILA
PRADEEP
JENIFER . J
SHEEBA DAS

THE CONCEPT OF EXPORT PROMOTION

All

national governments have established institutional

set-ups to support export activities.
The

major objective of export promotion programmes is

to create awareness about exports and make the people
understand that it is one of the most crucial instruments of
growth and market expansion.
A non-exporter

needs to be motivated by making him or

her aware of the international marketing opportunities.

A first-time exporter has to be assisted in finding export

marketing opportunities and may be supported on
matters related to export policy, procedures and
documentations.

An exporters consistently attempt to explore ways to

improve their international marketing operations and
need to be assisted by way of trade fairs, buyer sellers
meet, and market promotion programmes.

The export promotion programmes initiated by the

government are in the form of public policy measures.

The functions of export promotion programmes are:

To create awareness about exporting as an instrument of

growth and market expansion.
To reduce and remove barriers of exporting,
To create promotional incentives.
To provide various forms of assistance to potential and
actual exporters.
The export promotion programmes are basically
designed to assist firms in entering international markets
and achieving optimum opportunities from their
international business activities.

ROLE OF EXPORT PROMOTION

INSTITUTIONS IN IM
The export promotion organizations(EPOs) are meant to
assist an international marketing manager to identify
overseas market opportunities, product and packaging
requirements, the pricing patterns, identifying IM
channels, and marketing opportunities.
Statutory requirements, such as registration-cummembership certificates(RCMCs), quota administration ,
and disbursement of incentives through promotion
organizations, make it necessary for the marketers to
approach these organizations.

INSTITUTIONAL SET-UP FOR EXPORT

PROMOTION IN INDIA
In order to provide guidance and assistance to an exporter, the
Government of India has setup several institutions. The institutional
set-up for export promotion in India can be divided into six different
tires:
1.

Department of commerce

2.

Advisory Bodies

3.

Commodity Organizations

4.

Service Organizations

5.

Government Trading Organizations

6.

State Export Promotion Agencies

Department of Commerce:It is the primary government agency responsible for

evolving and directing foreign trade policy and
programmes , maintaining commercial relations with other
countries, supervising state trading, initiating various trade
promotion measures, and developing and regulating
export-oriented industries.
Following are the divisions of the Department of Commerce:
The economic division is engaged in export planning,
formulating export strategies and periodic appraisal, and
review of policies.
The trade policy division is responsible for maintaining
Indias compatibility with regional trading agreements
such as EU, NAFTA, SAFTA, Commonwealth, etc.

Foreign trade territorial division looks after the

development of trade in different countries and regions
of the world.
The export division looks at the problems connected
with production, generation of surplus, and
development of products for exports under its
jurisdiction.
The export industries is responsible for the
development and regulation of rubber, tobacco, and
cardamom sectors.
The export division deals with the problems of export
assistance , such as export credit, export house etc.

Advisory Bodies:
The advisory bodies provide an effective mechanism to
maintain continuous dialogue with trade and industry
and increased coordination among various departments
and ministries concerned with export promotion. Bodies
for promoting international trade:
Board of Trade
The Board of Trade was setup under the chairmanship
of Union Minister of Commerce and Industry in May
1989.The broad terms of reference of Board of Trade
are as follows:
To advice the govt. on policy measures for the
preparation and implementation of both short and longterm plans.

To review export performance of various sectors, identify

constraints, and suggest measures to be taken.
To examine the existing institutional framework for
exports and suggest practical measures for reorganization.
To review the policy instrument, package of incentives,
and procedures for exports, and suggest steps to
rationalize and channelize incentives to areas where they
are most needed
Export Promotion Board:
In order to effect greater co-ordination among ministers
involved in exports, Export Promotion Board was setup. It
works under the chairmanship of the Cabinet Secretary
and provides policy and infrastructural support to the
exporters.

COMMODITY ORGANIZATIONS
There are various commodity organizations, such as,

Export promotion councils

Commodity boards
Autonomous bodies

These organizations look at sector-specific exports.

Export promotion councils :

Export promotion councils are non-profit
organizations. They are provided by financial
assistance by the central government.
At present there are 20 export promotion councils. Their
basic objective is to promote and develop exports in
the country.
The main role of the EPCs is to project India as a reliable
supplier of high quality goods and services in the
international market.
Each council is responsible for the promotion of a
particular group of products, projects and services.

The present set-up of EPCs covers the following sectors:

Engineering
Project
Electronics and computer software
Plastics and linoleums
Chemical and allied projects
Gems and jewellery
Leather
Indian milk
Carpet
Cotton textiles
Handicraft

Functions :
To provide commercially useful information and
assistance.
To offer professional advice to the members.
To organize visits to abroad to the members.
To organize participation in trade fairs, exhibitions.
To promote interaction between the exporting
community and government.

Commodity boards:
In order to look after the issues related to production,
marketing and development of commodities. The
commodities which follows,
Tea board
Coffee board
Coir board
Central silk board
All India handlooms and handicraft board
Rubber board
Cardamom board
Tobacco board
Spices board

Functions :
Provide an integrated approach for production
development and marketing of the commodity

They act as a link between Indian exporters and

importers aboard

They formulate and implement quality improvement

systems, research and development programmes.

They act as an interface between the international

agencies such as the ITC, FAO,UNIDO etc.

They collect information on production, processing

and marketing of the product under its purview and
dissemination.
They organize export promotion activities such as
participation in international trade fairs, buyer-seller
meeting.

Autonomous bodies:
APEDA agriculture and Processed Food Products Export
Development Authority.
APEDA looks after the promotion of exports of agriculture
and processed food products.
It works as a link between the Indian exporters and the
global markets
The products are,
Fruits , vegetables, and their products
Meat and meat products
Poultry and poultry products
Dairy products
Biscuits , and bakery products

Honey , jaggery and sugar products

Cashew nuts, groundnuts and papads
Herbal and medical products

The basic functions of APEDA are as follows:

It develops database on products, markets, and
services.
It develops and implements various publicity
exercises.
It invites official and business delegations from
abroad.

MDEDA- Marine Export Development

Authority
MDEPA is an autonomous body under the ministry of
commerce. It covers all kinds of marine products.
The prime objective are to increase export-oriented
production, specify standards for processing and
export marketing.

Functions :

It provides timely and efficient services to overseas

buyers

It establishes trade links between Indian suppliers and

overseas buyers

It participates overseas trade fairs and exhibitions

It arrange products displays for visiting overseas buyers

SERVICE INSTITUTES

Indian institute of foreign trade

Indian council of arbitration

India trade promotion organization

National centre for trade information

Export-credit guarantee corporation

Export import bank of India

Indian institute of packing

Federation of Indian export org.

INDIAN GOVERNMENTS TRADE

REPRESENTATIVES ABROAD
The institutional set-ups developed and
strengthened within the country are supplemented
by the Indian trade representatives abroad. The
trade representations in the embassies and
consultants are continually being strengthened to
enable them to effectively support the effort,
which is being made within the country.

GOVERNMENT PARTICIPATION IN
FOREIGN TRADE
For supplementing the efforts of the private sector in the
field of foreign trade, the govt. of India has set up a no. of
corporations, namely STC, MMTC, spices trading
corporation ltd., MSTC.
These corporations results at diversifying the countrys
foreign trade. They perform following activities:

To arrange for exports where bulk handling and long term

contracts are beneficial.

To organize production to meet export demand

and to help production units overcome difficulties
in raw material procurement.
To undertake import of commodities
where bulk purchase is advantageous.
To facilitate exports of difficult to sell
items through various devices such as
linking essential imports with additional
exports under barter, link and parallel
deals.

STATES INVOLVEMENT IN
PROMOTING EXPORT
States being the prime centers for export production need
to be involved actively in export promotion. The central
and state government has taken a number of measures to
promote export, which have been discussed as follows:

1.

States cell in the ministry of

commerce:
To act as a nodal agency for interacting with state
government on matters related to export and import from
the state and for handling references received from them.

To process all references of general

nature emanating from state
governments and state export
corporation.
To monitor proposals submitted by
the state government to the ministry
of commerce and coordinate with
other divisions of the ministry.
To act as a bridge between state
level corporations and associations.
To provide guidance to state level
export organizations.

EXPORT PROMOTION INITIATIVES BY

STATE GOVT.

Provide information on export

opportunities.
Allot land for starting export oriented
unit.
Plan for the development of export
promotion industrial parks.
They exempt entry tax on supplies to
EPZ units.

IMPEDIMENTS IN EXPORT
PROMOTION
State govt. are reluctant to promote export
activities due to the following reasons: Export never become number one priority of
state agenda bcoz revenue never go to the
state coffers.
State govt. do not distinguish between
exporting unit and domestic unit bcoz of same
reason.
The govt, generally lack the required
expertise for export promotion.

Additional facilities for export-oriented

development mean more cost for the state
governments.