There are several export business options in India to tap when you are looking to sell Indian made products in foreign countries. In recent times we have seen positive growth in the export and import business in India. Understanding its scope, many entrepreneurs or startups are willing to venture into this area. There are a lot of lucrative export business options available in India. You can earn a lot of money in this business. Owing to the booming trade for both export and domestic supply/demand, India offers enormous profit potential to savvy entrepreneurs. They have a keen eye to opportunities and the zeal to go after them.
Expand your Business through Exporting
By exporting your products along with the services to the universal marketplace, you will be able to develop more market share and evolve your business as well. If you’re not speculating with respect to exporting of products and services, your competition could catch these untapped markets before you.
The Narendra Modi – led government is putting its wholehearted efforts to facilitate exporting vigorously. Thus, there are many resources available to assist you in learning how to commence exporting, find buyers, and make financial arrangements for your exporting activities.
Financing your Exports
- You might desire some financial help in lifting the working capital and other financing options to give a smooth run to your exporting program.
- The great news is that numerous resources can enable you to finance these requirements. Various government schemes, along with the efforts of Aatmnirbhar Sena, would boost the exporting activities.
- Relying upon your trade history and financial track record, you can get a traditional loan or line of credit via a commercial bank that has an outstanding finance division familiar with the certain necessities of exporters.
Export Business Options
India runs a negative trade balances, i.e., total imports are more significant than exports. India’s trade deficit narrowed down to USD 4.83 billion in July 2020 from USD 1343 billion in the same month and compared to USD 2.0 billion’s market expectations.
Export declined by 10.21 percent. Export business options fill the gap, which could also help strengthen the economy. The Government has taken numerous initiatives over the years, including the incentives declared by the Finance Ministry that the scheme for Remission of Duties or Taxes on Export Products will replace the Merchandise Exports from India Scheme. The new plan will completely replace MEIS for all goods and services. These schemes and initiatives boost the budding entrepreneur’s confidence to take export business options as their means of livelihood.
If the budding entrepreneurs are willing to start an export business to harness the opportunity available, here are some excellent export business options:
Coffee
As of 2009, Indian coffee has made up for 4.5 percent of the world’s production, and 80 percent of the product is exported. Italy makes 29 percent of the coffee exports earned, Germany, Russia, Spain, Belgium, Slovenia, United States, Japan, Greece, Netherlands, and France also buy Indian coffee for its excellent quality.
Annual production of coffee in India is raising at an accelerated pace that enables the nation to retain the sixth position among the world’s largest producers of coffee. Exported close to 80% of the produced Indian coffee beans, accounting for 4% of the universal coffee market.
The coffee cultivation in India — what are the features? Coffee in India is developed in factories as well as small private landholdings. On the whole, coffee production in India included around 124 thousand plantations. They are focused chiefly in the South of the nation where they were initially placed. Later the coffee cultivation in India was mastered in the Eastern, North-Eastern States of India. It’s one of the smart export business options.
Sugar
India is a significant exporter in terms of sugar. It exports its sugar to Bangladesh, Afghanistan, Iran, Sri Lanka, etc. Many Government’s initiatives support sugar mills, and if you get yourself registered with DGFT (Director General of foreign trade), exporting sugar gets free.
The average sugar recovery rate is assumed to improve, and even on the side of consumption, the healthy domestic command from soft drink manufacturers, ice cream manufacturers, hotels, and bakeries would drive patterns of consumption. India’s nearly strong economic growth, rising incomes, young population, stable political situation, and evolving consumer consumption patterns are envisioned to be the essential drivers stimulating higher consumption of sugar.
The sugar exports of India would rise 50% to a record figure of more than 5.7 million tonnes, supported by the depreciated rupee, subsidy & lower output from suppliers who are rivals. The Indian government is expecting that the numbers would improve in the forthcoming period and open the door for export business options.
Handicrafts
India has many artisans and rural crowds who make decorative items by hand or hand-made tools. These are highly in demand and are immensely useful, but they lack global recognition. There are different websites, such as Amazon, Flipkart, Jabong, eBay. Etc where these products can be listed for customers to see and buy it from overseas.
As one of the most extensive employment generators after agriculture, this sector is a crucial means of livelihood to the rural and urban population of India. Persevering on self-sustaining models of business with craftspeople regularly growing their raw materials, the division has also been the pathfinder of inclusion and environment-friendly exercises in a real sense.
Due to the COVID-19 pandemic, online sellers have now commenced doing several businesses. It is furthering handicraft exporters from India. Most online sellers have wearied their stocks and are looking for unique products. Hence, there is a stream in demand from such buyers since August 2020, and we are anticipating that this will continue in the upcoming months. It’s one of the bright export business options.
Cotton
Cotton is one of the most abundant agricultural products in India. It is in huge demand in several countries around the globe. So, starting an export business of cotton is very easy and requires very little capital. Keeping a track of export business options is crucial.
Cotton is commercially utilized in several forms as cotton fiber, cottonseed, and oil. Near about 64% of the cotton produced is employed in building apparel, 28% for home furnishings, and the remaining 8% is utilized for usage in industries. Cottonseed is being applied in animal fodder for compound feed purposes. Cotton is utilized in cottonseed oil in the composition of numerous edible products in the food industry. These varied uses and endless demand in several cotton crop industries make it a distinct and beneficial export trade product.
Jewelry
The demand for Indian traditional jewelry is very high in the outside world. By investing in the designer and business who can design unique jewelry, you can rule this market. It’s a risky and moderate export business options.
- India is the second-largest gold consumer in the world.
- The entire net export of gems & jewelry reached US$ 29.01 billion in FY20. Import was at US$ 26.05 billion at the same time.
- India exported around US$ 18.66 billion worth of polished and cut diamonds in FY20P. It added 64% to the total gems and jewelry export.
- The top export destinations for gems and jewelry in India are the US, China, Europe, Japan, etc.
- The US accounts for approximately one-fourth of the cumulative gems and jewelry export of the country.
- The Indian government is steering at US$ 80 billion in jewelry export over the upcoming five years from 2019.
- The total gems and jewelry export deemed for US$ 5987.88 million from the month of April to August 2020, and for August 2020, it was around US$ 1823.34 million*.
Milk Products Export
India is the largest producer of milk and its milk products. Milk production and selling are not just an export option for the dealers, but their means of livelihood. The main challenge is of maintaining the temperature while it is in transit.
Buoyed with the enormous demand for dairy products made in India from numerous countries, India has posted a mountainous 126% growth at 123,877 metric tons worth of about USD $ 380 million (INR 27 billion) in milk and milk products exports during 2018-19 financial years. Turkey, Bangladesh, UAE, Egypt, and Bhutan were the significant destinations for India’s dairy exports.
Organic Products
Organic means natural. Organic products and food items are always in demand in and outside India. In countries like the UK, the USA, and Canada market demand for organic food is very high. With an established business, activities related to organic goods can earn a lot of money.
The burgeoning trend for organic food products throughout the world increased organic farming all over India. India’s organic food exports rose by 50% to INR 5,151 crore in FY 2018-19. India beheld a two fold jump in demand is accounted for pesticide-free as well as chemical-free produce. The organic food products in demand encompass sesame, flax seeds, red gram, tea, soybean, pigeon pea, as well as other medicinal plants.
Tea and Spices Export
Indian spices and tea culture are famous all over the world. People are crazy about Indian spices, and the demand for tea is immense worldwide, doing Indian spices and tea export business deemed as the perfect export business options. The export of Indian tea and spices is growing every year and expected to develop further. India has the most extensive domestic market for spices in the world.
Due to their exquisite aroma, taste, texture, along with medicinal value, Indian spices have become the most sought-after on a global level. India is the world’s biggest producer, purchaser, and exporter of spices.
Tobacco Export
This is a perfect and profitable export business options. However, tobacco export is restricted in a few countries. So, before starting tobacco export, you need to study laws very carefully concerning any particular country.
- Cumulative exports of tobacco and manufactured tobacco substitutes held at US$ 981.33 million in 2018-19 and touched US$ 558.40 million in 2019-20. Indian tobacco is exported to nearly 100 countries.
- Entire exports of unmanufactured tobacco reached US$ 570.30 million in 2018-19 and touched US$ 318.89 million in 2019-20.
- India exports unmanufactured tobacco essentially to Belgium, Korea, Nigeria, Egypt, and Nepal. Western Europe is the key market for Indian tobacco exports.
Points to Consider before Commencing the Import Export Business
Opting for Right Product
The first point to take into consideration at the time of initiating foreign trade is choosing the right product that may provide value to you. There are specific limited products. It would be best if you examined the product range before opting for something. You should study the export & import trend as it would turn out to be beneficial.
Ascertaining the Market Potential
The subsequent step after deciding the right product is discovering market potential. You must conduct market research to discover competition, product consumption, & applicable export advantages. You may utilize data available with export agencies.
Applicable Payment Terms
You should talk over applicable payment terms, the currency utilized in a transaction, and a mode of payment well in advance. It will assist in reinforcing transparency in the entire business.
Potential Buyers & Sellers
You should learn about potential buyers and sellers associated with the product. The buyer, as well as the seller, can be across the nation. You may make use of online websites in doing so.
Assessment of Risk
You should evaluate the risk related to this business. The primary risk you will encounter while conducting this business is payment risk. You may make use of ECGC to cover the non-payment risks. Additionally, you can wrap risk by taking the insurance.
Profitability Status
It is very crucial to review profitability linked with the product you choose. Higher profitability is inclined to give you immediate success in the business.
Essential Steps for Starting an Export Business in India
It would help if you were sure of the resources you have to start any business before deciding to start one. Once that is sorted, it is recommended to open a sole proprietorship at the initial stages of your business to simplify legal procedures.
- Get your business registered with an attractive logo and name.
- It is also mandatory to get a PAN for the business for income tax purposes.
- Open a current account at a bank of your choice to maintain working capital to run your day-to-day business.
- Get Import Export Code (IEC) registration done. Documents required for import export code includes (1) Personal PAN card or Company PAN Card (2) Applicant’s photograph. (3)Copy of canceled cheque from the business’ current account.
- Obtain Registration/Membership Certificate (RCMC), which is granted by the concerned Export Promotion Councils, which provides you the authorization to import or export or avail other related benefits.
Take Away
With boosted disposable income among global consumers comes both business-to-business and business-to-consumer opportunities. So probably it’s the perfect time to contemplate ways to export your products & services. As an Aatmnirbhar Sena, we are doing our best to promote the awareness of export business options among the masses and the Government guidelines supporting exports in India.
