EXPORT & TRADING HOUSE

History –Export House The origin of export houses in India goes

back to 1958 when Government of India gave serious consideration to the development of specialized agencies for the promotion of non traditional items

The initiative was necessary to help the small scale sector in the export of their products

The criterion adopted by Indian Government in EXIM policy 1985-88Exports divided into SELECT Product ( non traditional products – engineering goods , leather

etc )

NON SELECT Product ( Traditional items )

Export Turnover : Between 3 crore to 7 crore

Annual Growth Rate : Minimum 20%

History –Trading House The concept of Trading House in India was

brought into being by the government in 1981-82

It was in line with such a concept in developed countries where encouragement given to those companies who have professional expertise in the field of International Trade , export

The criterion adopted by Indian Government in EXIM policy 1985-88The export house were eligible to

become Trading Houses provided they had annual average export in the three previous financial years of at least Rs 15 crore of exports in the select products

Annual Growth Rate : Minimum 20% for renewal of status

EXIM Policy 1988 - 1991The eligibility of grant of Export house /

Trading House certificate was based on the concept of NFE (Net Foreign Exchange ) earning made in the preceding three licensing years termed as “ Base Period “

The annual average NFE earnings in the prescribed base period should not be less than

(i) Rs 2 crore in the case of export house (ii) Rs 10 crore in the case of Trading

house

EXIM Policy change 2007With effect from 1st April 2007 the criterion

for criterion as Export house , Trade house or star trading house is the average annual NFE during the three preceding years Category Performance ( In Rupees )

Export House ( EH ) 20 crore

Star Export House (SEH ) 100 crore

Trading House 500 crore

Star Trading House

2500 crore

Premier Trading House (PTH) 10000 crore

Star Export House

Who can Become Star Export House ?Merchant as well as Manufacturer

Exporters, Service Providers, Export Oriented Units (EOUs) and Units located in Special Economic Zones (SEZs), Agri Export Zone (AEZ’s), Electronic Hardware Technology Parks (EHTPs), Software Technology Parks (STPs) and Bio Technology Parks (BTPs) shall be eligible for applying for status as Star Export Houses

Eligibility Criterion The applicant shall be categorized depending on his total FOB/FOR export performance during the current plus the previous three years

Classification Criterion Category Performance ( In Rupees )

One Star Export House 15 crore

Two Star Export House 100 crore

Three Star Export House 500 crore

Four Star Export House 1500 crore

Five Star Export House 5000 crore

Privileges

Licence/certificate/permissions and Customs clearances for both imports and exports on self-declaration basis

Fixation of Input-Output norms on priority within 60 days;

Exemption from compulsory negotiation of documents through banks. The remittance, however, would continue to be received through banking channels;

100% retention of foreign exchange in EEFC account

Enhancement in normal repatriation period from 180 days to 360 days.

Entitlement for consideration under the Target Plus Scheme

Exemption from furnishing of Bank Guarantee in Schemes under this Policy.

Reference 1) http://books.google.co.in/books?id=bQ-04WIqkl8C&pg=PA50&lpg=PA50&dq=Define+star+export+house&source=bl&ots=5Ht6v8DbSv&sig=ChKzt5HUY1EcdcnF9ztIEG2-p6g&hl=en&ei=WpeQTOGYG8aHccOHxPYM&sa=X&oi=book_result&ct=result&resnum=9&ved=0CDYQ6AEwCA#v=onepage&q&f=false