Page 116 - DMGT546_INTERNATIONAL_TRADE_PROCEDURE_AND_DOCUMENTATION

Unit 5: Methods of Financing Exporters and Business Risk Management

the test, a certificate to that effect is issued that enables the exporter to gain clearance at Notes
customs.

In-Process Quality Control- This system emphasises the need to exercise quality control at the
process stage. To this end, EIAs approve certain units against applications received in the
prescribed format, as possessing adequate levels of quality control systems in all relevant areas,
based on its own thorough assessment carried out by a panel of Inter-departmental experts.
Units thus approved are granted an option either to issue the certificate of inspection of export
worthiness on their own or to obtain the certificate of inspection from EIAs representatives keep
making spot checks on such units from time to time.

Self-Certification- This system provides for additional stringent norms over and above in
process quality control (IPQC) procedures in the crucial areas of design and development,
quality audit, after sales service, housekeeping and maintenance. An export unit needs to apply
to the EIA in the prescribed format. Upon receipt of the application, EIA representatives carry
out a thorough inspection of the facilities and quality control systems in use at the exporter’s
premises, particularly in the four designated areas. Once satisfied, the unit is recognised by the
Government of India as being capable of issuing certificates of export worthiness for their own
export consignments.

Relaxations from Compulsory Pre-shipment Inspection

The following relaxations have been granted from pre-shipment inspection:

All the star trading houses as well as Industrial Units in Export Processing Zones and 100%
Export Oriented Units have been exempted from the purview of Compulsory Pre-shipment
Inspection.
Units approved by EIAs under the system of In-process Quality Control (IPQC) have been
authorised to issue statutory certificates by themselves.
Items which were hitherto subjected to compulsory pre-shipment inspection have been
exempted from the same, provided the exporter has a firm letter from the overseas buyer
stating that the overseas buyer does not require pre-shipment inspection from any official
Indian inspection agencies.

Recognition to Inspection Agencies

EIC operates a scheme to recognise inspection agencies for carrying out the pre-shipment
inspection on its behalf. Any agency desiring recognition as an inspection agency for any of the
notified commodities under the Act needs to furnish an application in duplicate in the prescribed
proforma accompanied by an application fee of ` 5,000 (non-refundable) as given in the
Schedule of Fee in Clause 9 and a copy of its Quality Manual.

5.6.2 Pre-shipment Inspection as per Requirements of the Buyer

We have understood the mechanism of compulsory pre-shipment inspection as required by the
Government of India through its network of EIC and EIAs. However, the foreign buyer may
waive of this compulsory inspection by a government recognised agency but may insist on pre-
shipment inspection by an independent agency nominated for the purpose by him or his own
agent. In such cases, the exporter will receive instructions from the buyer and he must follow the
same religiously.

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