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ASSIGNMENT
DRIVE WINETR WINTER 2014
PROGRAM MBADS (SEM 4/SEM 6) MBAFLEX/ MBAN2 (SEM 4)
PGDIB (SEM 2)
SUBJECT CODE & NAME IB0018 – Export-Import Finance
SEMESTER 4
BK ID B1910
CREDITS 4
MARKS 60
Note: Answer all questions. Kindly note that answers for 10 marks questions should be
approximately of 400 words. Each question is followed by evaluation scheme.
1 .Discuss the role of EXIM bank in promoting foreign trade.
Answer : Exim Bank's role in promoting international trade
Export-ImportBankof India(EximBonk,In short) is a wholly cerement-owned financial institution,
set up for the purpose of financing, facilitating and promoting Indian's 'foreign trade. Exim Bank
plays a four-pronged role with 'regard to India's foreign trade: those of a coordinator, a source of
finance, consultant and promoter.
EximBank offersadiverse range of financingservices for the Indian exporter, including a variety of
Export Credit Facilities and Finance for Export
2 What is the need for export finance in India? Write a short note on export financing facilities in
India.
Answer : Need for export finance in India
Trade Finance is a specific topic within the financial services industry. It's much different, for
example, than commercial lending, mortgage lending or insurance. A product is sold and shipped
overseas,therefore,ittakeslongerto get paid. Extra time and energy is required to make sure that
buyersare reliable andcreditworthy.Also,foreignbuyers - justlike domesticbuyers - prefertodelay
payment until they receive and resell the goods. Due
3. Advance Against Export Bills Sent on Collection Basis
Bills can only be sent on collection basis, if the bills drawn under LC have some discrepancies.
Sometimes exporter requests the bill to be sent on the collection basis, anticipating the
strengthening of foreign currency.
Banks may allow advance against these collection bills to an exporter with a concessional rates of
interestdependinguponthe transitperiodincase of DP Billsandtransitperiodplususance periodin
case of usance bill.
4 Write short notes on:
a) Export credit guarantee corporation
Answer:Export CreditGuarantee Corporation isa central governmentundertakingbodyto provide
credit guarantee on the default of payments by the buyer. It works as an insurance firm who
guarantees export payment, if the buyer defaults in making payment.
Procedures with ECGC to cover insurance:
Once afterfinalizingthe order,the buyerexecute a purchase order to the seller with the terms and
conditions as agreed by both. The purchase order should contain full details of buyer and buyer’s
bankaccount details.The exporterapproachesExportGuarantee Corporationtogetapproval on the
buyer with amount of limit. Here, the ECGC
b Foreign exchange risk
Answer : Foreign exchange risk is the risk to the value of one’s assets when it is valued in another
currency.The exchange rate of a currencyto anothermay be volatile.Itisthischange invalue of the
currencythat givesrise toforeignexchange risk.A depreciationinthe currency in which your assets
are denominated will result in a lower
5 Discuss the payment options available to exporter and importer.
Answer : Consignment Purchase
Consignmentpurchase termscanbe the mostbeneficialmethodof paymentforthe importer.Inthis
methodof purchase,importer makes the payment only once the goods or imported items are sold
to the enduser. In case of no selling,the same itemisreturnedtothe foreignsupplier.Consignment
purchase is considered the most risky and time taking method of payment for the exporter.
6 What is custom duty? Discuss its types.
Answer : n economics, a duty is a kind of tax, often associated with customs, levied by a state. The
termis oftenusedtodescribe atax oncertainitemspurchasedabroad.Properly, a duty differs from
a tax in being levied on specific commodities, financial transactions, estates, etc., and not on
individuals. Duties may be import duties, excise duties, stamp duties, death or succession duties,
etc.; but income tax levied on a
Dear students get fully solved assignments
Send your semester & Specialization name to our mail id :
“ help.mbaassignments@gmail.com ”
or
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Ib0018 – export import finance

  • 1. Dear students get fully solved assignments Send your semester & Specialization name to our mail id : “ help.mbaassignments@gmail.com ” or Call us at : 08263069601 (Prefer mailing. Call in emergency ) ASSIGNMENT DRIVE WINETR WINTER 2014 PROGRAM MBADS (SEM 4/SEM 6) MBAFLEX/ MBAN2 (SEM 4) PGDIB (SEM 2) SUBJECT CODE & NAME IB0018 – Export-Import Finance SEMESTER 4 BK ID B1910 CREDITS 4 MARKS 60 Note: Answer all questions. Kindly note that answers for 10 marks questions should be approximately of 400 words. Each question is followed by evaluation scheme. 1 .Discuss the role of EXIM bank in promoting foreign trade. Answer : Exim Bank's role in promoting international trade Export-ImportBankof India(EximBonk,In short) is a wholly cerement-owned financial institution, set up for the purpose of financing, facilitating and promoting Indian's 'foreign trade. Exim Bank plays a four-pronged role with 'regard to India's foreign trade: those of a coordinator, a source of finance, consultant and promoter. EximBank offersadiverse range of financingservices for the Indian exporter, including a variety of Export Credit Facilities and Finance for Export 2 What is the need for export finance in India? Write a short note on export financing facilities in India. Answer : Need for export finance in India Trade Finance is a specific topic within the financial services industry. It's much different, for example, than commercial lending, mortgage lending or insurance. A product is sold and shipped overseas,therefore,ittakeslongerto get paid. Extra time and energy is required to make sure that buyersare reliable andcreditworthy.Also,foreignbuyers - justlike domesticbuyers - prefertodelay payment until they receive and resell the goods. Due 3. Advance Against Export Bills Sent on Collection Basis
  • 2. Bills can only be sent on collection basis, if the bills drawn under LC have some discrepancies. Sometimes exporter requests the bill to be sent on the collection basis, anticipating the strengthening of foreign currency. Banks may allow advance against these collection bills to an exporter with a concessional rates of interestdependinguponthe transitperiodincase of DP Billsandtransitperiodplususance periodin case of usance bill. 4 Write short notes on: a) Export credit guarantee corporation Answer:Export CreditGuarantee Corporation isa central governmentundertakingbodyto provide credit guarantee on the default of payments by the buyer. It works as an insurance firm who guarantees export payment, if the buyer defaults in making payment. Procedures with ECGC to cover insurance: Once afterfinalizingthe order,the buyerexecute a purchase order to the seller with the terms and conditions as agreed by both. The purchase order should contain full details of buyer and buyer’s bankaccount details.The exporterapproachesExportGuarantee Corporationtogetapproval on the buyer with amount of limit. Here, the ECGC b Foreign exchange risk Answer : Foreign exchange risk is the risk to the value of one’s assets when it is valued in another currency.The exchange rate of a currencyto anothermay be volatile.Itisthischange invalue of the currencythat givesrise toforeignexchange risk.A depreciationinthe currency in which your assets are denominated will result in a lower 5 Discuss the payment options available to exporter and importer. Answer : Consignment Purchase Consignmentpurchase termscanbe the mostbeneficialmethodof paymentforthe importer.Inthis methodof purchase,importer makes the payment only once the goods or imported items are sold to the enduser. In case of no selling,the same itemisreturnedtothe foreignsupplier.Consignment purchase is considered the most risky and time taking method of payment for the exporter. 6 What is custom duty? Discuss its types. Answer : n economics, a duty is a kind of tax, often associated with customs, levied by a state. The termis oftenusedtodescribe atax oncertainitemspurchasedabroad.Properly, a duty differs from a tax in being levied on specific commodities, financial transactions, estates, etc., and not on individuals. Duties may be import duties, excise duties, stamp duties, death or succession duties, etc.; but income tax levied on a Dear students get fully solved assignments Send your semester & Specialization name to our mail id : “ help.mbaassignments@gmail.com ” or Call us at : 08263069601
  • 3. (Prefer mailing. Call in emergency )