Merchant export

[Guest]

We intend to open a Merchant export operation in India so that our customers from outside India places the orders to our Indian arm directly and in turn we place those orders to the Indian manufacturers. Please advise the correct way to do this. We don't want to get into the local duty draw back documentation which we would like to give directly to the manufacturer exporter. Also we would like to pay the local manufacturer directly in USD. Also we don't want the manufacturer name reflects in any of the documents to the foreign Buyers.

[Ganeshan Kalyani]

Merchant exporter procures the order from international market and in turn places the order to manufacturer and he sell the material in his name from his premises or from manufacturers place. This clarifies your query in last sentence.

[Sunil Gohil]

There are FTWZ facilities in India now. Where in you can Buy goods from India Manufacturers in the Zone. You can make payments to these Indian Manufacturers in freely convertible foreign currency. (Refer RBI circular RBI/2012-13/259 dt. 23/10/2012).

In these FTWZ facilities you can re-label or re brand these goods and export it to your clients.

In this case:

1. You can operate from these FTWZ without having an India arm or you may opt for an India set up.(doesn't matter)

2. The manufacturer can claim his incentives for exporting the goods. (export to FTWZ is deemed export)

3. You can make payments in USD.

4. Your foreign buyer will not know who the actual manufacturer was (however the country of origin remains India).

I hope this helps you.

AI Summary

FTWZ facilitation enables purchasing, relabelling, and foreign currency payment for exports while preserving manufacturer anonymity. Merchant export involves a merchant exporter procuring foreign orders and selling goods in its name while placing production with domestic manufacturers, enabling the merchant exporter to appear on export documents. Operating via a Free Trade and Warehousing Zone (FTWZ) permits purchasing, relabelling/rebranding, export from the zone, foreign currency payments to manufacturers, and allows manufacturers to claim export incentives as deemed exports, while keeping the manufacturer's identity from the foreign buyer though country of origin remains India.