Importance of local guidelines and rules in Import Business

Hello, friends. Welcome back to my exports imports knowledge blog. So friends now, the theme of this article friends is the local guidelines and rules. So friends in the import business set up in the overall process, before we go on for selecting the suppliers and finalizing the contract and all those things, it is very, very important friends to understand what are the local guidelines and rules. That is very, very important. So objective of this article, friends, is to understand the important guidelines related to import operation in the home country, whichever country you belong to. What are the different guidelines and rules? That is very important.

And second objective is to understand all the rules related to the different categories of products and the categories of importers. So every country has got their products classification system and every country have their own categorization of the importers. The status of the importer, what kind of importer you are. So that has to be checked. That is very, very important. So friends, as I’ve just mentioned to you that every country has their own local guidelines and rules framed for the product categories and commodities, for example, their classification, which I just mentioned to you and the categories of importers.

So the examples are – whether you are importing for the export purpose because you belong to a 100 percent export oriented unit in a special economic zone or you’re a government sponsored importer. So you may be a canalized agency which is allowed to import specific products, which others are not allowed. So there are every types of categories, different categories in different countries. Every local government has their own ways of categorizing the importers to the domestic requirements as per the need. Friends Generally, these guidelines and rules are typically given by the following types of local publications and announcements which comprise of the foreign trade policy of the local government. What is the foreign trade policy of the local government?

The Handbook of Procedures and Documentation, or the standard input-output norms, which means there are certain metrics in which every product which is generally exported or sold in the domestic market, they have their input norms. What kind of raw materials which is involved in the manufacturing of those products? So those inputs, some of which may be required to be imported so that standard input-output norms are normally announced by the local government. So they are supposed to be the same across the countries, but depending on the country and depending on the methods used by the local governments.

The standard input output norms or in short it is called SION are different in different countries and the classification system. For example, in India, we use Indian trade classification, which is very similar to the International Trade Classification Harmonized System. So other countries also have the similar classification system. So similarly, in India, you have the foreign trade policy, which is announced by the government for five years. The current policy, for example in India, is from 2015 to 2020. The new policy is yet to come.

It is going to be coming very soon, which will be from 2020 to 2025. So Five-Year policies are there in India. Every country has their own foreign trade policy tenure. It can be two year, three year, five year. It can be even 10 years And the other example is the U.S. trade policy. So US also has it FT policy. Every country has their own trade policy and there will be a document. So you have to look at those documents. Similarly, in India, we have the handbook of procedures so which explains the different provisions of the foreign trade policy, the methods of exports, the methods of imports, and what are the different categories of importers in that country.

How to carry out the import operations. So all this information is given in this handbook, of procedures. So similarly, the other countries also have the similar document. In the U.S. for example, it is the Foreign Trade Regulations document, which is very similar to the Handbook of Procedures in India. Similarly, friends in India we have the SION standard input-output norms, which are announced by DGFT that is the Directorate General of Foreign Trade. So every country has their directorate or some agency which announces the standard input-output norms for the purpose of imports and exports. So it is very, very similar in many of the countries.

In some countries rarely this system may be quite different. So this is how the four pillars of the guidelines and rules are established in each country, which includes the foreign trade policy, the handbook of procedures, the standard input norms and the products classification.

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