International trade has increase economic inter dependence of nations. Modern industries are depended on variety of raw materials ail of which cannot be conveniently and economically produced in any one countries.

No country has with in its own boundaries to get resources for economical production of all its requirements through international its possible for a country to obtain goods produced as cheaply as other countries.

Foreign trade or exports, which are part of international trade, make a significant and necessary contribution to the economy and the countries development. A developing country like India with a large and growing industrial infrastructure needs imports of capital equipment and article raw material. To sustain development and also hasten the growth of industry with a view to increase the employments potential exports become necessary.

Obviously shipping industry has a vital role to play, in the growth of international trade. Shipping is a highly competitive and challenging business, serving the needs of international trade in the form of sea transport. It is truly international, both in the nature of its business and in the way it is organized. Shipping the industry devoted to moving goods livestock and passengers by water mostly By sea, The industry connects people from different corners of the world commercially through ship we can transport a Jumbo Jet to tiny electronic parts.

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Commercial shipping probably began in the Mediterranean Sea where the merchants of Phoenicia owned ships and traded widely. Many of their practices were adopted by Ancient Greece and the Roman Empire. Later, in the Middle Ages, the merchants of Venice carried on and further refined these practices. Even today, commercial shipping practices associated with marine insurance and the carriage of goods can still be traced to those early roots. 

From the 15th to the 18th centuries, deep-sea shipping was closely linked to colonial trade especially that of the Spanish Empire, the Portuguese Empire, the Dutch Empire, and the British Empire, and to the growth of the great enterprises like the Hudson’s Bay Company and the East India Companies. During the 19th century and until the middle of the 20th century, most of the world’s merchant fleet operated under the British Flag or the Flag of one of the long established maritime nations like Norway, France, Germany, and Japan. Shipping truly throughout the world have a unilateral rules and regulations in Sea traffic, Port entry clearance, which was derived and developed by the British during their rule across the globe. However cargo movement restrictions vary from country to country depending upon their culture, Domestic Trade and their Government Policy. 

Nature of Shipping Industry, 

Shipping is a mode of transport through sea for cargo as well as passenger transport around 90% of the international cargo transport is being done through sea. Shipping industry and Export and Import are inter dependent. A country where Export and Import are flourishing, there the shipping business also be very active. Compared to air traffic, Sea traffic is safe and economical.

Apart from Cargo Transport many of the European countries use passenger vessels, for human transport as it is economical compared to the Air Transport and it develops the Tourism in such countries. 

Indian Shipping 

The Indian shipping tonnage has developed fairly after independence. India now has a shipping fleet of 6 million gross register tonnage (GRT). 

The Indian shipping industry is classified into two categories, like coastal shipping and overseas shipping. Indian shipping is a very long history and has its roots from the early centuries. 

The position of Indian shipping during 1947 was just 59 vessels. Out of which, 48 were coastal and 11 were overseas. 

There are 45 trade routes that emanated from the Indian continent. During the time of independence the British vessels dominate the coastal scene. So, the government of India declared a "Coal Reservation Policy" in 1950 in reference to coastal trade. Soon, the Indian ship owners formed," Indian coastal Conference" in 1951.This agreement tried to regulate the business through various measures. But still, there were problems like under rating, rebated and other malpractices continued. However, by 1953, Shares of British shipping were reduced to nil. Indian shipping grew in quantum leaps. But the problems faced by the industry are very complex and complicated due to various reasons like increase in operational coasts, railways penetrating the market, etc. 

Regrading, the overseas shipping, after 1850 Indian shipping industry began to decorate due to various reasons. By the end of the century it was practically nil. The British Government was keen on nursing its own interests and never made any attempts to retrieve the Indian industry. 

In 1912 the Scandia steam Navigation Company was incorporated. It launched the first modern overseas services from Bombay to U.K. Later various companies, both from private and public sector came into existence. With the evaluation of new Government polices after independence, the shipping reads began to grow rapidly. Indian Government also signed various trade agreements for the benefit of the Indian shipping industry, like Indo- UAR, Indo-USSR, India - Romania Bulgaria and Indian polish. 

Shipping conference administer their own freight rates through their own tariffs. This is unlike the transporting sector where freight rates are determined through the market force of supply and demand, The administered freight rates are which member liner of conference caters to the requirements of shipper have often been a bone of contention between shippers and the concerned conference. As India's foreign trade become modernized. The freight making policies of these shipping conferences also become much more complicated. 

In most cases, the actual carriers of the Shipping lines never touch the Indian port. Instead, reaches the Colombo port the transshipment port for this port of Asia. The cargo from various Indian ports is transported to the Colombo port, through the shuttle service operating between these ports and the Colombo port. From there, the cargo is transshipped to various destinations. This is done in order to reduce the time and cost involved in carrier touching all the ports in the same ports in the same region. The shuttle service will be more or less a regular one and it is know as the 'Feeder Service' and the actual carrier is known as the 'Mother Vessel'

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The Cargo to be handled in different ways. It may be as follows. 

Dry Bulk Shipping (Bulk Carriers) 

The principal dry bulk cargoes carried in merchant ships are: iron ore, coal, phosphates, bauxite, and grain. These are all low value commodities and must therefore be transported as cheaply as possible. Transportation costs for dry bulk commodities are often less Bulk carriers are usually large vessels designed both to carry full cargoes and, when necessary, to make return voyages to loading ports without any cargo.

Bulk Carriers are designed to carry bulk solids. Some bulk carriers are multi-purpose, while others are specially adapted to carry dense cargoes like iron ore, or lighter cargoes like wood chips. They also have substantial water ballast capacity so that they can proceed to sea safely after discharging their cargo. Combination carriers, ore/oil and ore/bulk/oil carriers can carry either bulk solids or bulk liquids. The bulk carriers included as salt, wheat, rice, and coal.

Bulk Oil and Gas Shipping (Tankers)

Tankers carried mainly refined oils from producing areas. crude oil is now transported in huge quantities from the world’s major producing areas Most of it is carried in VLCCs or ULCCs, ultra large crude carriers, which are the largest tankers But products like diesel oil, petrol, and paraffin are now usually transported from refineries in industrialized countries to coastal storage and distribution centers.

International trade in liquefied gases has grown substantially since the 1960s. Many LNG (methane) and LPG (butane and propane) tankers are now in service.

Tankers are designed to carry bulk liquids. Most are engaged in the carriage of oil, but some are specially adapted to carry liquefied gases, chemicals, or even wine. VLCCs ( very large crude carriers), are designed to carry crude oil. Very large crude carriers (VLCCs) became common space required; these ships are generally around 2,50,000 tonnes carrying capacity, much of which is accounted for by the cargo. Loading and discharging rates may be as high as 10,000 tonnes per hour. Products and chemical tankers are usually smaller and more complex than VLCCs.

Tankers can be mostly used with the liquid items.

Liner Shipping (Containers)

Liner shipping is characterized by scheduled sailings on an advertised route. Cargoes may consist of many different kinds of goods, in consignments that are each much less than a shipload. Today many liner services are containerized.

liner cargoes include manufactured and high-value goods that can bear higher transport costs than bulk cargoes.

Container ships are designed to carry standard ISO (20 ft and 40 ft and 40HC and 45 and reefer) containers, either in designated cells within a hold, or on deck. Large cellular container ships are capable of carrying several thousand containers.

Many subsidiary ports do not have container cranes; so small feeder container ships often have their own handling equipment.

Coastal and Short Sea Shipping (Passenger Cruise Ships)

Coastal and short-sea shipping are concerned with the movement of cargo and passengers between ports in the same country, or between ports belonging to adjacent countries on the same continent Cruising is an increasingly important shipping sector. In recent years many new cruise ships have been built. Many older vessels have also been converted for cruising. Cruise ships are like floating resort hotels. The latest are very large, with extensive recreational facilities and amenities for 2,000 or more passengers.

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Below the Basis Docs required for clearance,

Authorization letter to handle the clearance

AD Code (if not registered)

IEC Copy /PAN

Invoice

Packing list

SDF Form (Self Declaration Form)

Shipping Instruction for filling Shipping bill

Scheme Declaration (if app).

Obtain customer approval for the check list.

After approval pick up the cargo & document and arrange export movement.

Shipping documents collect and hand over to clearance team for clearance process.

Follow up with clearance team for status of the shipment.

After clearance, collect shipping bill from customs.

Update the shipping instructions to the shipping line.

Operation team to handover the cargo to the co loader or liner agents,

Take vessel schedule from the shipping line and update to the customer.

Ask shipping line for debit and make cheque or DD request.

Send to the account department.

MBL has to be released with shipping line within seven days of vessel departure.

Prepare HBL and send to shipper approval.

Make final HBL once approval obtained.

Check the JFN for releasing the B/L for payment terms. Send pre alert to counterpart agent

Coordinating with counterpart agent regarding arrival of the shipment at destination.

Tracking of movement of the cargo till destination and updating to the customer

Inform arrival, customer clearance & delivery confirmation at destination to customer.

Payment collections-submit bills to the customer according to the terms and condition.

Documents need to handover to Shipper

Bill of lading

Export cleared shipping bill

Export cleared invoice and packing list for record

Any other shipper related documents duly signed by the customs.

Documents attached with Pre-alert

HBL copy

MBL copy

Commercial Invoice

Packing List

Agent Debit/ Credit Note 

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LCL is the short form for less than container load. 

If the volume of the shipment does not need full container, then such a shipment is offered to forwarder who closes the container of their own.

These forwarders are known as co-loaders.

The rate is offered on weight or measurement (w/m) and žThe weight of the cargo is expressed in terms of weight and measurement expressed as cubic meter (CBM). The minimum rate is charged on weight or per CBM whichever is higher. 

LCL – Less Container Load, LCL shipping is a good way to ship large orders and items that are large or heavy. LCL shipping is based primarily 

on volume with a minimum shipment volume of one cubic meter.

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Introduction

Introduced in 31st December 1980,by Ministry of Commerce.

Purpose
To boost exports by creating additional production capacity.
Notification No. is 052/2003

Duty Free Imports allowed under EOU Scheme

Second Hand Captial Goods

Repair and Return of Goods

EHTP/STPI

Decision are taken by Board Of Approvals (BOA) ,under Ministry of Commerce.
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EOU’s are licensed to manufacture goods within the bonded premises.
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Period of bond is 5 years (extendable for another 5 years with the permission of development of commissioner)
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The imported capital goods are allowed to be warehoused for a period of 5 years. For other goods the period is 1 year.

Eligibility Criteria—

EOU can be set up by any entrepreneur for manufacturing of goods and also for rendering services. 

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EOU can be set up for repair, reconditioning , re-engineering also.
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EOU unit is required to achieve only positive NFE over a period of 5 years.

Main Objective

The main objectives of the EOU scheme is to :-
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Increase Exports
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Earn Foreign Exchange for the country
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Generate additional employment

Salient Features—Exemption on customs duty on imports of capital goods, raw materials, consumables, spares, packing materials etc.
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100% foreign direct investment permissible.
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Even second hand plant and machinery can be imported.
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EOU’s get up to 5 years for utilization of imported capital goods, and up to 3 years for other items.

Documents Required for EOU—

LOP (Letter of Permission)
Green card with LOP
Bonded warehouse license copy
I.E Code Registration certificate
B-17 bond with B.G (Bank Guarantee)
Require STPI Approval for STPI clearance.

Import Procedure for EOU

Application for registration to Deputy/Asst Commissioner of customs at port of import. Accompanied with following documents: 

Copy of LOP, Pvt.bonded warehouse License copy, Green card, IEC no.

The B/E should filled and assessed based on the import documents. 

B-17 block transfer should be debited for movement of goods (Procurement Certificate in case if unit is located outside i.e., not within the city limits)

After all clearance formalities goods shall be sent to bonded premises of the EOU. 

Importer have to apply for open examination of the cargo from superintendent of EOU.

The EOU Inspector will inspect the goods to ensure the quantity, marks and numbers etc and the inspector will give his report. After inspection the superintendent will verify all the documents and will issue the re-warehousing certificate.

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A freight forwarder is a person or company that organizes Export/ Import shipments for individuals or companies and may also act as carrier or agent. The agent can book the cargo with main agent and get the space for the shipments,

Main Activities of Forwarding

•Customer care through follow-up, pre alerts and post landing updates to customers for all air imports shipments for all branches.
•Online filing of cargo manifest.
•Maintaining 4 sets of documents-Account/Customer/Clearance/Consol copy.
•Filing of branch CANS.
•Maintaining of MIS reports.
•Customer visits for service updates and requirements.
•Sales leads and follow-ups

Freight Forwarding Procedure

Enquiry- Receipt of enquiry from the customer and to obtain the required rates/info from agents. Quotations- Prepare the quote as per the standard formats with standard conditions. 

Import follow up- Forwarding PO reference to agents and to chase for pick up, booking info, pre alerts and filing manifest. 

Issue of CAN- Ensuring arrival of shipments as per pre alerts, preparing and dispatching Cans as per the quote.

Issue of Do- On receipt of authorization letter, BRO, payment, or credit as per the quote and approval from finance, issues DO. 

Preparation of Docket- Opening of docket with Can no and accumulation of all documents as per the defined procedure. 

Verification of Agents- D/N or C/N-Verification of cost and revenue as per the agreed terms, if any discrepancy is found, to take corrective actions. 

MIS reports- Based in info in the main register to prepare various MIS reports as defined, daily reports, sector wise performance reports(monthly), objectives status(as per periodically defined)

Objectives of Freight forwarding

To achieve and sustain an average on-time arrival of 90% for shipments booked on committed time. 

To achieve and sustain the existing period for submission of quotations to customers with in a day from the date of the enquiry.

Main Barriers and constraints,

TERMS OF SHIPMENT
COMMUNICATION GAP
TRANSIT TIME
TRANSSHIPMENT

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