India is a promising destination for businesses and marketers across the globe. In the past few years, excluding the COVID-Era, India’s global trade has witnessed tremendous growth owing to the ever-evolving demand for Indian commodities. Many aspiring entrepreneurs and start-ups are eyeing this as a great opportunity to venture into an EXIM business. But the million-dollar question is which commodity is suitable to target in this regard. This write-up will make you aware of some trending ventures that adhere to great growth potential from the global trading standpoint.
Commodities that are quite popular in the EXIM business landscape
The section below briefs out the type of commodities that are quite popular in the EXIM business landscape.
Clothing
The apparel sector is an essential sector for India’s export. Its contribution stood at 6.5% of the country’s overall commodity export and nearly 47% of total textile and apparel export. Apparel export is the 3rd largest products exported from our nation and it is a prominent job creator for the nation.
Seafood export
The Indian Seafood industry has undergone a massive transformation with an ever-growing footing in the global market. India is a front-runner in the Global Seafood market for the following reasons;
- Availability of world-class production facilities
- Complete adherence to global standards
- Diversified range of products including crab, lobsters, & other kinds of fish. Shrimp still tops the chart in terms of overall exports.
For years, American and Japanese markets have remained the top destination for India’s seafood export.
Handicrafts export
Handicrafts are the prominent highlighter of Indian culture, tradition, and heritage. Also, this sector is the biggest hub of employment which embraces both skilled and unskilled laborers. After dented by ongoing pandemic, the handicraft sector is now picking up the pace as the global demand for the same is slowly coming back on track.
Handicraft exports increased by 6.44% y-o-y during 2018-19 with a total valuation that stood at US$ 3.80 billion. During Apr-Nov 2019, export valuation stood at US$ 2.45 billion. During this timeframe, the export of various segments such as crocheted goods and woodwares stood at US$ 389.69 million and US$ 518.19 million respectively.
Read our article:What is the IEC Registration Process in India?
Import of Pearl, precious and semi-precious stones
Indian import of precious stone posted the total valuation at %33 billion in 2017-18. India has imported nearly 14 billion worth of products in the period of 10 months (April 2020-Feb 2021). Semi-precious stones and precious stones accounted for 97% of the overall import valuation while natural pearls made up 2.25 percent. The American market has remained India’s prominent supplier, following by some Asian nations such as Singapore, Hongkong, and China.
India is a leading importer of rough diamonds, which made up 54% of its overall gems and jewelry imports in FY 2019-20.
India is also acknowledged as a world leader in the diamond cutting & polishing business. The majority of the rough diamonds imported to our country are largely processed in Surat, Gujrat[1].
Once polished, the finished diamonds are then exported abroad. 3/4th of the world’s polished diamonds are shipped to other nations from India. In 2019-20, the country posted $18.66 billion worth of polished and cut diamonds.
Import of Telecom instruments
Another leading contributor to Indian imports of electronic commodities is telecom equipment. Its share in electronic goods imports thrives 10% in 2011-18 as per Reserve Bank. The ever-growing demand for telecom commodities in India is met by imports.
While China is the global leader in importing office and telecom gear, it is also a leading supplier of the same to our nation.
Smartphone components have been the leading driver of telecom gears import since 2015-16. In FY 2019-20, the total importation value of India’s smartphone component imports were stood at Rs 56039 crores.
At the same period, the import of smartphones has encountered negative growth. This is primarily due to the push for local manufacturing under the Make in India program prohibition on some Chinese smartphones and the inculcation of stringent quality norms for Chinese-made telecom instruments.
Reasons for opting EXIM business in India
- Ever-evolving global demand for Indian products for exporting business
- Opportunities for importers to gain a competitive edge by amassing demanding and unique products from abroad
- Ensures access to the cheapest raw material which is costly in India. This will eventually help importers to grow and enable manufacturers to produce goods at an affordable rate.
- Availability of several government schemes that promote global trading in India.
- More stable than local business due to consistent demand throughout the year.
Inherent setbacks of an EXIM business
- The compulsion to ensure conformity with foreign trade policies
- Tedious Shipment Inspection at various stages
- Payment transaction takes longer time than usual
- Complexand heaps of paperwork for the shipping process
Conclusion
EXIM business is full of potential despite the avalanche of legal requirements and compliances. Anybody who seeks to venture into global trading must be aware of underlying legalities and compliances to avoid any trouble while executing the business operations. Import Export Code is one such requirement for the business owner who wants to engage with global trading. It is practically not possible to avail import-export business without this license. The availment of such a license seeks precise paperwork and utter attention. The application of such a license can be made online on the DGFT portal against standard fees.
Read our article:How to obtain IEC Code in India
