A Project Report

On

“STUDY ON INTERNATIONAL BUSINESS

OPERATIONS OF EAGLEBURGMANN INDIA
PVT LTD”

Submitted in the partial fulfillment of

THE MBA DEGREE COURSE OF MIT,WPU

Submitted By

PRIYA PAWAR

MBA-INTERNATIONAL BUSINESS

Submitted to

Survey No, 124, Paud Rd, Kothrud, Pune,

Maharashtra 411038

1
 DECLARATION

I, Priya Pawar, hereby declare that this project work submitted to MIT World
Peace University, Pune is a record of an original work done by me under the
guidance of Mr. Sanjeev K Nair (Deputy Manager EXIM,) EagleBurgmann India
Pvt Ltd, from 9th may to 9th July 2019, and this project work has not performed the
basis for the award of any Degree or diploma/associate ship/fellowship and similar
project if any. Furthermore , all the data & information furnished in this project report
is best to my knowledge and included only after due consent from EagleBurgmann
India Pvt Ltd, Pune.

DATE: SIGNATURE
Priya Pawar

2
 ACKNOWLEDGEMENT

“Gratitude is not a thing of expression; it is more a matter of feeling”

The satisfaction which accompanies the successful completion of my task is
incomplete without the mention of the names of those people who made it
possible, because success is epitome of hard work, zeal,determination and most
encouraging and advice serve as light and crown our effort with success.
I would sincerely thank Mr.. Animesh Bzagchi (Sr.Vice President Finance) and
Mr. Ankush Kondhalkar (Assistance Vice President Finance) for their guidance
and encouragement in carrying out this project work.

I take this opportunity to express my profound gratitude and deep regards to my

Mentor Mr. Sanjeev K Nair (Deputy Manager EXIM,) EagleBurgmann India Pvt
Ltd for his exemplary guidance, monitoring and constant encouragement throughout
the course of this thesis. The blessing, help and guidance given by him time to time
shall carry me a long way in the journey of life on which I am about to embark.

I am obliged to staff members of EagleBurgmann India Private Limited, for the

valuable information provided by them in their respective fields. I am grateful for
their cooperation during the period of my internship.
I feel deep sense of gratitude towards Dr. Saylee Gankar(Dean, MIT World Peace
University, Pune) for arranging my internship at EagleBurgmann India Pvt Ltd and
being a constant source of motivation and guidance throughout the course of my
internship.
Lastly, I thank my parents and friends for their constant encouragement without
which this project would not be possible.

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 TABLE OF CONTENTS

CHAPTER NO. TITLE PAGES

1. Executive summary 05

2. Introduction 07

3. Objectives 11

4. Company Profile 12

5. Research methodology 18

6. Data analysis, findings and 20

interpretations
7. Limitations 33

8. Conclusion 34

9. Reference/sources 35

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 CHAPTER:01
EXECUTIVE SUMMARY

India has always been dealing with imports and exports since centuries. Imports and
exports are the biggest component of the economy today. The word export implies the
sending to another nation of a good or service generated in one nation. An import is a
good or service carried from another nation. In addition to exports, imports are the
cornerstone of international trade, the greater the value of imports entering a nation
compared to the value of exports, the more adverse the balance of trade of the nation
becomes. There is a correct export performance procedure and paperwork as well as
the import company.

Based on the alliance between EagleBurgmann Industries and Eagle Industry, the
company group EagleBurgmann was created in 2004. EagleBurgmann is one of the
major sealing solutions and products suppliers. EagleBurgmann sealing technology is
used in the petroleum and gas, refinery, petrochemical, chemical and pharmaceutical
sectors globally.

EagleBurgmann India Private Limited ("EBIN" or "the Company") was established in

1973 as a private limited company. Currently, the company is mainly involved in
manufacturing, importing, exporting and selling mechanical seals, welded metal
bellows, gland packing, fittings, instruments and associated components.

This project is titled as, “A study on international business operations of

EagleBurgmann India Pvt Ltd. “, where it aims to understand the exports procedure
and the documentation. The project mainly focuses on how the exports and imports
procedure is carried out at EagleBurgmann India Pvt ltd.

In this project I have studied the various aspects of the exports and imports . I learned
and analyzed the number of exports taking place monthly and yearly. I compared the
the exports and imports of last three years .I also studied the countries from where the
maximum goods are exported and imported and also how documentations takes place
in the company.

5
Since EagleBurgmann is a market leader in the manufacture of mechanical seals, they
export products such as spare parts etc. to different nations such as Japan, UAE,
Dubai etc. EagleBurgmann India is a market leader in the manufacture of mechanical
seals, they have different daily import and export operations.

The information used for the research was drawn from SAP (Systems Application
Products). The information was drawn from the last three years, i.e. from April 2017
to March 2019. This information is secondary in nature and it was studied carefully to
understand the company's complete annual and monthly exports. It also helped me
comprehend each country's exports separately.

During my summer internship program with EagleBurgmann I was trained in various

aspects related to export clearance, documentations, and procedures, right from the
pre-shipment documentation stage to post- shipment documentations, formalities
involved in realization of export proceeds, procedures relating to Letter of Credit(L/C)
consignment. Daily functions were carefully observed and also different schemes
involved in exports were studied in detailed.

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 CHAPTER:02
INTRODUCTION

I. BACKGROUND

INDUSTRY PROFILE:

Production is the manufacture of products for use or sale using labor and machinery,
instruments, chemical and biological processing or formulation. The word may refer
to a variety of human activities, from handicrafts to high-tech, but is most frequently
applied to industrial design, in which raw materials are converted into large-scale
finished goods. Such finished goods can be sold to other producers for the
manufacturing of other, more complicated products, such as aircraft, household
appliances, furniture, sports equipment or automobiles, or sold to wholesalers who
then sell them to distributors and sell them to end customers and customers..

Production manufacturing relates to the methodology of manufacturing and

manufacturing products for sale most effectively. Make to inventory (MTS), create to
order (MTO) and allow to assemble (MTA) are three prevalent kinds of production
procedures.

Mechanical seals:

Mechanical seals are rotary shaft seals used in pumps, blending vessels and shafts for marine
propellers to prevent leakage or consumption of fluids. Mechanical seals took over the
business of gland packing to fix the problems of older technology such as leakage, etc.
Mechanical seals also use less energy than gland packing and involve less maintenance.

Mechanical seals are mainly used in the chemical industry and are also used in pumps,
mixers, agitators, compressors and so on. In automotive water pumps and water lifting pumps,
simple mechanical seals are also used.

The discovery of shale gas production also plays an significant role in boosting demand for
mechanical seals, as it has stimulated oil production and exploration activities, especially in
the United States. Similarly, even modern hydrocarbon processing plants involve highly
reliable seals in order to limit the leakage of liquids. Thus, during the forecast period, these
developments will bode well for market growth. According to the research, many
governments worldwide and international organizations such as the U.S. have set strict
regulations and standards for the mining, refining, oil and gas, energy, and chemical
industries. EPA. The regulations regulate toxic emissions, preserve operational safety, and
prevent gas and liquid leakage through pipes, boilers, and other equipment. To meet the
criteria set, seals of superior quality must be produced that can prevent contamination of the
product.

Segmentation of mechanical seal market:

The segmentation of the mechanical seal industry by the end user is

7
depicted below:

Due to the rise in shale gas production in developed and developing nations, the oil
and gas industry is the biggest income generator on the mechanical seals market and
is anticipated to stay at the top until the end of the forecast period. Factors such as
fresh oil and gas exploration operations combined with comprehensive pipeline and
refinery investment in the Americas, the Middle East,

Pumps

Indian pump companies have traditionally met national market requirements to

primarily pump water in homes from wells. Therefore, India was mainly an import-
oriented nation for multiple industrial requirements, such as oil refineries, steel mills,
mines, etc.
Fluid control machinery sector is extremely fragmented catering segment for many
sectors such as petroleum, chemical, industrial, power generation and water, while
pumps are a significant industry segment, increasing at a standardized rate of 3-5
percent, out of which industrial pumps have the greatest market hold.
India has become the preferred location for worldwide producers of pumps and valves
with the availability of inexpensive and highly qualified laboratories. A big amount of
multinational companies engaged in the manufacture of pumps and valves have joined
the Asian markets, especially India, not only because these markets are increasing
steadily, but also because of the elevated labor costs and inputs in the European
countries. Production in India is not just being used for meeting demand in India but
also to expand presence in other Asian and African countries.

Indian pump industry, exported to around 70 nations, is set to record a quicker rate of
development than the worldwide average to capture a larger slice of the international
market, an industry survey states. The Indian pump sector is expected to expand by
10-12 percent compared to the globe pump market over the next four years, with
development expected at a pace of 7 percent by 2016 of USD 76 billion.
India presently generates about one million different types of pumps, according to
sector estimates. There are about 800 big, medium and small units generating pumps
in the nation, ranging from agriculture to industry, including nuclear power
generation.. Mining, wastewater, petrochemicals, textiles, energy, oil and gas,
refineries, pharmaceuticals, automobiles, irrigation, medical testing, laboratory
equipment, among others, are the multiple sectors that form the' buyers ' segment for
pumps and valves. Industry demand is increasing in line with other variables, such as
population shifts from rural to urban regions, clean water needs, emerging markets.
These factors affect the growth of the fluid control equipment industry. Changes in
regulations have also given a new turn to the industry.

Indian pumps are exported to several nations including Australia, Egypt, the United
Kingdom, the United States, Singapore, Ghana, Germany, Nepal, the UAE, the
Netherlands, and Italy. The US is India's biggest pump customer; Chile is India's
biggest pump buying sector, the copper sector, and the oil and gas sectors in the
Middle East have a large pump market.

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 EXPORTS

EBIN sold mechanical seals and spares to various AE outside India.Export of

mechanical seals are closely linked to the primary business activity of manufacturing
of mechanical seals and the revenue earned by EBIN with respect to export of
mechanical sales has been considered while determining the operating results of
EBIN in relation to its manufacturing activities. An export in international trade is a
good or service produced in one country that is bought by someone in another
country. The seller of such goods and services is an exporter; the foreign buyer is an
importer. Export of goods often requires involvement of customs authorities.Many
manufacturing firms began their global expansion as exporters and only later switched
to another mode for serving a foreign market. Exporting refers to sending of goods
and services from the home country to foreign country.

IMPORTS

EBIN has imported certain components from its AE. These components were used
for manufacturing of mechanical seals for domestic and international market. The
Company also imported certain semi-finished goods which were assembled and / or
re-packaged before being sold in the domestic market. Import of components for
manufacturing are closely linked to the primary business activity of manufacturing of
mechanical seals and the expenditure incurred by EBIN with respect to import of
components for manufacture of mechanical seals has been considered while
determining the operating results of EBIN in relation to its manufacturing activities.

II. COMPETITORS
1. JOHN CRANE : John Crane is an American company, now a subsidiary of
Smiths Group and provider of engineered products and services including mechanical
seals, couplings, hydro-dynamic bearings, seal support systems, filtration systems and
artificial lift. The company services customers in the energy services sector including
production, transmission and storage, refining, power generation, petrochemical, pulp
and paper, and mining industries.

2: LEAK-PACK ENGINEERING (I) PVT. LTD. :LEAK-PACK is manufacturer,

supplier and exporter of complete range of Mechanical Seals and Sealing components
with the innovative technology for Pumps, Agitators, Mixers, Vacuum Pumps,
Blenders, Reactors, Blowers, Pharmaceutical Machinery and Rotating Equipments. Its
product range includes Pusher Seals, Non-Pusher Seals, Rubber Bellow Seals, PTFE
(Teflon) Bellow Seals, Metal Bellows Seals, Dry Running Seals, Agitator Seals, Split
Seals and Seal Support Systems.It specializes in providing solutions to all types of
leakages by manufacturing Mechanical Seals and Sealing Components as per
customer’s drawings, samples or requirements. It also specializes in refurbishing all
types of Mechanical Seals.

3: FLOWSERVE: The Flowserve Corporation is an American multinational

corporation and one of the largest suppliers of industrial and environmental

9
machinery such as pumps, valves, end face mechanical seals, automation, and
services to the power, oil, gas, chemical and other industries.

4: HI-FAB ENGINEERS PVT. LTD. : HI-FAB Engineers Pvt. Ltd., was established
in 1982 by a team of young technocrats having many years of experience in
designing, manufacturing and troubleshooting of Mechanical Seals. HI-FAB has
earned a reputation for offering some of the most progressive, innovative and proven
fluid sealing solutions to the processing industry.

5: RANE ELASTOMER PROCESSOR: Manufacturer & exporter of silicone

rubber corona treater sleeve, dock bumpers fenders, silicone rubber transparent
tubing, silicone rubber sheet, silicone rubber wires cables, silicone rubber membrane
sheet, rubber compound, silicone rubber gasket, silicone rubber door gaskets, rubber
ring, rubber cord, silicone rubber sponge cord.

CHAPTER : 03

OBJECTIVES

To study and analyze the export procedure and documentation at

EagleBurgmann India Private Limited which includes:

1. The study of the meaning and terms related to exports and imports

2. The study of exim procedure.

3. The study of the documents involved in exports and imports .

4. The study and analysis of the total exports and imports over a period of 3 years
to different countries.

5: The study how the company imports and exports the goods from one country to
another.

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6: The study how terms of payment differ from client to client.

7: The study of how exchange rates are used for different countries.

SCOPE OF THE STUDY

1: Facilitates more international trade / export.

2: Easy terms and condition of credit makes exim easier.

3: International payments made easier.

4: To meet, short, medium, and long-term financial needs.

5: Better consumer service.

CHAPTER 04:

COMPANY PROFILE
 INTRODUCTION:

EagleBurgmann India Pvt. Ltd. is the market leader in the mechanical seal industry in
India, with over 40 years of rich experience.With its headquarters and main manufac-
turing location situated in Pune, it also has two other manufacturing locations in
Mumbai and Vapi. We are certified to the ISO 9001:2008 for quality management
systems and have successfully implemented environment management systems and
occupational management systems which are certified to ISO 14001:2009 and
OHSAS 18001:2007 respectively.

EagleBurgmann offers engineered, rugged and reliable sealing solutions in virtually

all segments of the process industry. In India, the key industrial sectors served are the

11
oil and gas industry, refineries and petrochemical plants, power plants, the fertilizer
industry and many more.
At EagleBurgmann, we have always catered to challenging applications in the
industry and hence are known more popularly as a "sealing solutions provider" rather
than merely a seal manufacturer. We design and manufacture mechanical seals and
sealing systems for a wide array of equipments that include pumps, compressors,
mixers, kneaders, agitators, turbines, etc. The designs are proven over the years with a
vast reference of successfully running applications in the field.

One of the leading providers of industrial sealing technology on the international

stage. Our products and comprehensive services are used wherever the key
requirements are reliability and safety.Being part of the German Freudenberg and
Japanese EKK group gives us all the resources we need for a reliable partnership built
on solid foundations.

EagleBurgmann India Private Limited - Manufacturer of non metallic extension joint,

non metallic flexible expansion joint & non metal rubber expansion joint in Chennai,
Tamil Nadu.EagleBurgmann demonstrates every day exactly what reliability, safety
and maximum cost-effectiveness really mean. Our company’s success derives from
our employees who contribute their commitment, ideas and expertise in every
organization and country.

EagleBurgmann offers engineered, rugged and reliable sealing solutions invirtually all
segments of the process industry. In India, the key industrial sectors served are the oil
and gas industry, refineries and petrochemical plants, power plants, the fertilizer
industry and many more. At EagleBurgmann, we have always catered to challenging
applications in the industry and hence are known more popularly as a & quot;sealing
solutions provider" rather than merely a seal manufacturer. We design and
manufacture mechanical seals and sealing systems for a wide array of equipments that
include pumps, compressors, mixers, kneaders, agitators, turbines, etc. The designs
are proven over the years with a vast reference of successfully running applications in
the field.

VISION:

 To be the world’s most respected and customer-orientated sealing solution

provider.

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MISSION:

 To be the most successful sealing solution provider in the world.

 Delivering highest quality sealing products.

 To be the best local service for our customers in the markets we serve.

 Contribute to the protection of the environment.

 Solve all our customer’s problems fast, effectively and efficiently wherever they
are.

 Employee development worldwide:

6000
5900
5800
5700
5600 Employees
5500
5400
5300
2014 2015 2016 2017 2018

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 Global sales development :

830
820
810
800
790
780
Sales
770
760
750
740
730
2014 2015 2016 2017 2018

With more than 60 subsidiaries worldwide, we are close enough to our customers to
be able to respond quickly and efficiently to their requirements. About 45,000
customers worldwide from many different industries and areas of application rely on
our expertise.
The safety of people and the environment has absolute top priority at EagleBurgmann;
we have our products and company regularly checked and certified by independent
bodies.

 MARKET SIZE

India’s manufacturing sector has the potential to touch US$ 1 trillion

by 2025. There is potential for the sector to account for 25-30 per cent
of the country’s GDP and create up to 90 million domestic jobs by
2025. Business conditions in the Indian manufacturing sector continue
to remain positive.

The Government of India has set an ambitious target of increasing the

contribution of manufacturing output to 25 per cent of Gross Domestic
Product (GDP) by 2025, from 16 per cent currently.

 DEPARTMENTS:

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In a manufacturing engineering industry the management is responsible for the safe
and efficient planning, management and maintenance of production methods and
processes. Typical areas of work include:

i. RESEARCH AND DEVELOPMENT(R&D):

This involves exploring new concepts or materials for products as well as making
incremental improvements to existing products.Research engineers also try to find the
next big thing that will give their organization the edge in the market, by introducing
ideas for an improved product or innovating a new, advanced process. Whereas the
development process involves taking a product design or prototype and making it into
a manufacturable product. Development engineers consider the scale of production
(volume), availability of materials (and their cost), production safety, lead times,
quality and overall cost.

ii. DESIGN:

engineers design products with consideration of what the customer wants and the
specialist processes needed to manufacture them. Increasingly designers must
consider the ‘whole life’ of the product and review how the product will be disposed
of at the end of its life.A design department manager oversees various creative
and design projects for an organization. They collaborate with other members of
a design team, ensure projects are cost-effective, and maintain an up-to-date
understanding of their target market.

iii. MATERIALS:

Purchase Department basically deals with the procurement of raw material or any
other product which is actually required by the company for its functioning. It can
range from basic papers to the raw materials used for production.The object of
materials management is to attack materials cost on all fronts and to optimize the
overall end results. Materials management connotes controlling the kind, amount ,
location and turning of the various commodities used in and produced by the
industrial enterprises. It is the control of materials in such a manner that it ensures
maximum return on working capital.Material management covers all aspects of
material costs, supply and utilization.

iv. STORES:

The receipt store receives the material that comes from suppliers/vendors. The stores
in charge checks the material for commercial aspects like – quantity ordered in PO vs.
Quantity received, the value of invoice, is the material certificate. After checking
GRR is made the material goes to QA for inspection. Once QA approves it, the
material is sent to main stores and stock is updated in the system. Now it can be
issued to assembly/production.

v. PRODUCTION:

production engineers optimise manufacturing processes for safety and efficiency. It

involves managing production teams, maintaining schedules, dealing with health,

15
safety and environmental hazards and troubleshooting production line
issues.The Production Manager is responsible for making sure that raw materials are
provided and made into finished goods effectively.

vi. QUALITY ASSURANCE:

manufacturing organization have strict quality controls and will adhere to a system.
Engineers working in this area design and review quality systems, instruct and
supervise staff and develop and carry out quality assurance tests on products. is a way
of preventing mistakes and defects in manufactured products and avoiding problems
when delivering products or services to customers; which ISO 9000 defines as "part
of quality management focused on providing confidence that quality requirements
will be fulfilled".

vii. FINANCE:

The part of an organization that manages its money. The business functions of
a finance department typically include planning, organizing, auditing, accounting for
and controlling its company's finances. The finance department also usually produces
the company's financial statements.

viii. HUMAN RESOURCE:

Human resources specialists are responsible for recruiting, screening, interviewing

and placing workers. They may also handle employee relations, payroll, benefits, and
training. Human resources managers plan, direct and coordinate the administrative
functions of an organization.

ix. INFORMATION TECHNOLOGY:

The information technology department in an organization is responsible for the

architecture, hardware, software and networking of computers in the company. As an
IT professional, you perform a number of duties to ensure that employees have full
access to the computer systems.

x. ENGINEERING:

The Engineering Department is responsible for planning, analyzing and implementing

system extension projects; planning, design, and construction of major facility
replacements; capital improvement projects; continuing improvements to water
system standards; and technical assistance to other departments and to outside
agencies.

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  HISTORY OF THE COMPANY

 In 1975, Sealol Hindustan Ltd., a joint venture between EG&G Sealol Inc., USA
and the Dalal Group, Bombay, started manufacturing mechanical seals in Vapi.

 In 1982, the Dalal Group exited the management and the Poonawalla Group took
over Sealol Hindustan Ltd. During this time, the operations were shifted to Pune.

 In 1993, Burgmann India Pvt. Ltd., Mumbai, was incorporated in India through a
joint venture between Feodor Burgmann Dichtungwerke GmbH, Germany, and
the Balwa Group.

 In 1998, due to the worldwide acquisition of Sealol, the Poonawalla Group

entered into a joint venture with Eagle Industry Co. Ltd., Japan to form Eagle
Poonawalla Industry Ltd.

 In 2004 Feodor Burgmann Dichtungwerke GmbH, Germany, was renamed

Burgmann Industries GmbH & Co. KG.

 In the year 2006, however, the Poonawalla Group shares were acquired by Eagle
Industry Co. Ltd. and the company name was changed to Eagle Seals &
Systems India Ltd (ESSIL).

 2007 saw the acquisition of the Balwa Group shares by EBI Asia, to form a
wholly owned subsidiary.

 In 2009, Burgmann India Pvt. Ltd. merged with ESSIL to form EagleBurgmann
India Pvt. Ltd.

CHAPTER:05
RESEARCH METHODLOGY

For the study of the project sources of secondary data are used. That information was
utilized for performance evaluation and based on that,
interpretations were made.

Sources of secondary data are as follows:

GENERAL AND FINANCIAL INFORMATION:

1) This data was gathered through the company’s website.

2) Annual reports of EagleBurgmann of last three years.
3) Some information was also obtained through the internet.
4) A Detailed study on the actual exports process and documentation is
also done through the direct interaction with the employees and

17
with the mentor and by timely observing the happenings at the
company.

FOR THE EXPORT AND IMPORT PROCEDURE AND DOCUMENTATION

1) Bills provided by the suppliers in EagleBurgmann India Private

Limited
2) Documents prepared by the exports manager.

FOR EXPORT AND IMPORT DATA OF LAST THREE YEARS

1) Total number of exports of last three years (2017-2019) through SAP

system.
2) Country wise distribution of goods exported from excel sheet.

RESEARCH DESIGN

Research design is the based framework, which provides guidelines for the research
process. It is a map or blue print according to which the research is to be conducts.
The research design specifies the methods for data collection & data analysis
determine the source of data. Most specifically it was a kind of “Descriptive
conclusive research” who takes care of who, when, where, what, how and why
aspects of the investigation further the researcher used the statistical method to serve
he purpose of project, it permitted the research to derive more accurate generalization
whose reliability could be measured.

CENTRE: ALL OVER INDIA

RESEARCH: EXPLORATORY RESEARCH

18
TECHNIQUE: QUALITATIVE AND QUANTITATIVE
TOOL USED: TELEPHONIC & E-MAIL
DATA SOURCE: PRIMARY & SECONDARY

CHAPTER:06
DATA ANALYSIS AND INTERPRETATION

GENERAL EXPORT PROCEDURES AND DOCUMENTATION

OBTAINING IMPORTER EXPORTER CODE (IEC) NUMBER:

The Customs Authorities will now allow the exporter to export goods into or from
India unless he holds a valid IEC number. It is a 10 digit code number given to
an exporter by the regional office of the Director general of Foreign Trade (DGFT),
Department of Commerce, Government of India. You need Bank account and income
tax PAN number.

19
STEPS INVOLVED IN THE EXPORT PROCEDURE AND THE
DOCUMENTS ARE AS BELOW:

In reality, an export exercise is concluded successfully only after the exporter has
been able to deliver the consignment in accordance with the export contract and
receive payment for the goods.

1. Having an Export Order:

Processing of an export order starts with the receipt of an export order. An export
order, simply stated, means that there should be an agreement in the form of a
document, between the exporter and importer before the exporter actually starts
producing or procuring goods for shipment.Generally an export order,may be based
on terms of payment,which includes:

i. If advance payment a proforma invoice is raised by exporter.

ii. If letter of credit(L/C) is opened by the importer.

2. Examination and Confirmation of Order:

Having received an export order,the exporter should examine it with reference to the
terms and conditions of the contract. The examination of an export order, therefore,
includes items like product description, terms of payment, terms of shipment
(INCOTERM), inspection and insurance requirement, documents realizing payment
and the last date of negotiation of documents with the bank. Having being satisfied
with these, the export order is confirmed by the exporter.

3. Manufacturing or Procuring Goods:

The Reserve Bank of India (RBI), under the export credit (interest subsidy) scheme,
extends pre-shipment credit to exporter to finance working capital needs for purchase
of raw materials, processing them and converting them into finished goods for the
purpose of exports. The exporter approaches the bank on the basis of laid down
procedures for the pre-shipment credit. Having received credit, the exporter starts to
manufacture / procure and pack the goods for shipment overseas.

4: Clearance through LUT under GST:

As soon as goods have been manufactured/procured, the process for obtaining

clearance through LUT starts. It is a type of bank guarantee, under which a bank
allows its customer to raise money from another Indian bank’s foreign branch as a
short-term credit.
The purpose of such undertakings is to ensure that owner of the ship or aircraft would:

 employ security on the vehicle;

20
  enter an appearance acknowledge ownership;
 pay any final decree entered against the vehicle whether it is lost or not.

The Letter of undertakings can be furnished and submitted online through the GST
portal. LUT will be valid for a financial year. If LUT was furnished in FY 2017-18,
then the date of expiry of the validity of such LUT is 31st March 2018. Therefore,
You need to furnish fresh LUT for FY 2018-19.

5. Pre-shipment Inspection:

There are number of-goods whose export requires quality certification as per the
Government of India’s notification. Consequently, the Indian custom authorities will
require the submission of an inspection certificate issued by the competent and
designated authority before permitting the shipment of goods takes place.

Inspection of export goods may be conducted under:

Consignment - wise Inspection.
In-process Quality Control
Self - certification
The Inspection Certificate is issued in triplicate. The original copy is for the customs
verification. The second copy of the certificate is sent to the importer and the third
copy remains with the exporter for his reference purpose.

6. Appointment of Clearing and Forwarding Agents:

On completion of the process of obtaining the Inspection Certificate from the custom
agencies, the exporter appoints clearing and forwarding agents who perform a number
of functions on behalf of the exporter.

The main functions performed by these agents include packing, marking and labeling
of consignment, arrangement for transport to the port arrangement for shipment
overseas, customs clearance of cargo, procurement of transport and other documents.
In order to facilitate the exporter in discharging his duties, the following documents
are submitted to the agent:
(i) Pre-shipment invoices in 5 copies
(ii) Customs Declaration Form in triplicate
(iii) Packing list
(iv) Letter of Credit (original)(if applicable)
(v) Inspection Certificate (original)(if applicable)
(vi) e- Way Bill

7. Goods to Port of Shipment:

After the excise clearance and pre-shipment inspection formalities are completed, the
goods to be exported are packed, marked and labeled. Proper marking, labeling and
packing help quick and safe transportation of goods. The export department takes
steps to reserve space on the ship through which goods are to be sent to the importer.

21
The shipping space can be reserved either through the clearing and forwarding agent
or freight broker who works on behalf of the shipping company or directly from the
shipping company. Once the space is reserved, the shipping company issues a
document known as Shipping Order. This order serves as a proof of space reservation.
If goods are sent through a road carrier to the port, no specific formality is involved.
In case, the goods are sent by rail to the port of shipment, allotment of wagon needs to
be obtained from the Railway Board.

The following documents are submitted to the booking railway yard/station:

(i) Forwarding Note (A Railway Document)
(ii) Shipping Order
(iii) Wagon Registration Fee Receipt
Once wagons have been allotted, goods are loaded, for which railways will issue
Railway Receipt (RR). Then, this receipt and other documents are sent to the clearing
and forwarding agent at the port town. At the same time, the production/export
department takes insurance policy in duplicate for risk coverage (internal as well as
overseas) for the goods to be exported.

8. Port Formalities and Customs Clearance:

Having received the documents from the export department, the clearing and
forwarding agent takes delivery of the cargo from the railway station or the road
transport company and stores it in the warehouse. He also obtains customs clearance
and permission from the port authorities to bring the cargo into the shipment shed.
The custom department grants permission for export at the office of the customs and
physical verification of goods in the shipment shed. The clearance for export is given
on the Shipping Bill.

The clearing and forwarding agent is required to submit the following

documents with the Customs House for obtaining customs clearance and
permission:
(i) Shipping Bill
(ii) Contract Form
(iii) Letter of Credit, if applicable
(iv) Commercial Invoice
(v) GR Form
(vi) Inspection Certificate
(vii) AR4/AR4A Form
(viii) Packing List, if needed
After receiving documents from the export department, the clearing and forwarding
agent presents the Port Trust Document to the Shed Superintendent of the port. He
obtains carting order bringing the cargo to the transit shed for physical examination
by the Dock Appraiser.

The Dock Appraiser is presented the following documents to facilitate him in

physical examination of export goods:
(i) Shipping Bill
(ii) Commercial Invoice
(iii) Packing List
(iv) AR4/ AR4A Form and Gate Pass

22
(v) GR Form (duplicate)
(vi) Inspection Certificate (original)
The Dock Appraiser, after making examination, makes ‘Let Export’ endorsement on
the duplicate copy of the Shipping Bill and hands over it to the Forwarding Agent. All
these documents are presented to the Preventive Officer who puts an endorsement
‘Let Ship’ on the duplicate copy of the Shipping Bill. The preventive officer
supervises the loading of cargo on board the vessel.
After the goods are loaded on board the vessel, the captain of the ship issues a receipt
known as ‘Mate’s Receipt’ to the Shed Superintendent of the port concern. The
forwarding, agent after paying port charges, takes the delivery of the ‘Mate Receipt’.
He submits to Shipping Company and requests it to issue the Bill of Lading.

9. Dispatch of Documents by Forwarding Agent to the Exporter:

After obtaining the Bill of Lading from the Shipping Company, the clearing and
forwarding agent dispatches all the documents to his / her exporter.
These documents include:
(i) Commercial Invoice (attested by the customs)
(ii) Export Promotion Copy
(iii) Drawback Copy
(iv) Clean on Board Bill of Lading
(v) Letter of Credit
(vi) AR4/ AR4A and Gate Pass
(vii) GR Form (in duplicate)

10. Certificate of Origin:

On receipt of above documents from the forwarding agent, the exporter now applies
to the Chamber of Commerce for a Certificate of Origin and obtains it. If the goods
are exported to countries offering GSP concessions, the exporter needs to procure the
GSP Certificate of Origin from the concerned authority like Export Inspection
Agency.

11. Dispatch of Shipment Advice to the Importer:

At last, the exporter sends ‘Shipment Advice’ to the importer intimating the date of
shipment of the consignment by a named vessel and its expected time of arrival at the
destination port of the importer.

The following documents are also sent to the importer to facilitate him for taking
delivery of the’ consignment:

(i) Bill of Lading (non-negotiable copy)

(ii) Commercial Invoice
(iii) Packing List
(iv) Customs Invoice

12. Submission of Documents to Bank:

23
At the end of the process, the exporter presents the following documents to his
bank for realisation of his amount due to the importer:
(i) Commercial Invoice’
(ii) Certificate of Origin
(iii) Packing List
(iv) Letter of Credit
(v) Marine Insurance Policy
(vi) GR Form
(vii) Bill of Lading
(viii) Bill of Exchange
(ix) Bank Certification
(x) Commercial Invoice

13. Claiming Export Incentives:

On completion of the processing of an export order at the three levels of shipment i.e.,
pre-shipment, shipment and post-shipment, the exporter claims for export incentives
admissible to him / her.

THE GENERAL IMPORT PROCEDURE

The steps taken in import procedure are discussed as follows:

(i) Trade Enquiry:

The first stage in an import transaction, like any other transaction of purchase and sale
relates to making trade enquiries. The importer should mention in the enquiry all the
details such as the goods required, their description, catalogue number or grade, size,
weight and the quantity required. Similarly, the time and method of delivery, method
of packing, terms and conditions in regard to payment should also be indicated. In
reply to this enquiry, the importer will receive a quotation from the exporter. The
quotation contains the details as to the goods available, their quality etc., the price at
which the goods will be supplied and the terms and conditions of the sale.

(ii) Obtaining Foreign Exchange:

After obtaining the licence (or quota, in case of an established importer), the importer
has to make arrangement for obtaining necessary foreign exchange since the importer

24
has to make payment for the imports in the currency of the exporting country. The
foreign exchange reserves in many countries are controlled by the Government and
are released through its central bank. In India, the Exchange Control Department of
the Reserve Bank of India deals with the foreign exchange. For this the importer has
to submit an application in the prescribed form along-with the import licence to any
exchange bank as per the provisions of Exchange Control Act.
The exchange bank endorses and forwards the applications to the Exchange Control
Department of the Reserve Bank of India. The Reserve Bank of India sanctions the
release of foreign exchange after scrutinizing the application on the basis of exchange
policy of the Government of India in force at the time of application.

The importer gets the necessary foreign exchange from the exchange bank concerned.
It is to be noted that whereas import licence is issued for a particular period, exchange
is released only for a specific transaction. With liberalisation of economy, most of the
restrictions have been removed as rupee has become convertible on current account.

(iii) Placing the Indent or Order:

After the initial formalities are over and the importer has obtained the licence quota
and the necessary amount of foreign exchange, the next step in the import of goods is
that of placing the order. This order is known as Indent. An indent is an order placed
by an importer with an exporter for the supply of certain goods. It contains the
instructions from the importer as to the quantity and quality of goods required,
method of forwarding them, nature of packing, mode of settling payment and the
price etc.

(iv) Despatching a Letter of Credit:

Generally, foreign traders are not acquainted to each other and so the exporter before
shipping the goods wants to be sure about the credit worthiness of the importer. The
exporter wants to be sure that there is no risk of non-payment. Usually, for this
purpose he asks the importers to send a letter of credit to him.
A letter of credit, popularly known as ‘L/C or ‘L.C is an undertaking by its issuer
(usually importer’s bank) that the bills of exchange drawn by the foreign dealer, on
the importer will be honoured on presentation upto a specified amount.

(v) Obtaining Necessary Documents:

On receipt of the letter of credit, the exporter arranges for the shipment of goods and
sends Advice Note to the importer immediately after the shipment of goods. An
Advice Note is a document sent to a purchaser of goods to inform him that goods
have been despatched. It may also indicate the probable date on which the ship is
expected to reach the port of destination.
The exporter then draws a bill of exchange on the importer for the invoice value of
goods. The shipping documents such as the bill of lading, invoice, insurance policy,
certificate of origin, consumer invoice etc., are also attached to the bill of exchange.
Such bill of exchange with all these attached documents is called Documentary Bill.
Documentary bill of exchange is forwarded to the importer through a foreign

25
exchange bank which has a branch or an agent in the importer’s country for collecting
the payment of the bill.
There are two types of documentary bills:
(a) D/P, D.P. (or Documents against payment) bills.
(b) D/A, D.A. (or Document against acceptance) bills.

(vi) Customs Formalities and Clearing of Goods:

After receiving the documents of title of the goods, the importer’s only concern is to
take delivery of the goods, when the ship arrives at the port and to bring them to his
own place of business. The importer has to comply with many formalities for taking
delivery of goods. Unless the following mentioned formalities are complied with, the
goods lie in the custody of the Custom House.
(a) To obtain endorsement for delivery or delivery order:
(b) To pay Dock dues and obtain Port Trust Dues Receipts:
(c) Bill of Entry:
(d) Bill of Sight:
(e) To pay Customs or Import Duty:
(f) Bonded and Duty paid Warehouses:
(g) Appointment of clearing Agents

(vii) Making the Payment:

The mode and time of making payment is determined according to the terms and
conditions as agreed to earlier between the importer and the exporter. In case of a D/P
bill the documents of title are released to the importer only on the payment of the bill
in full. If the bill is a D/A bill, the documents of title of the goods are released to the
importer on his acceptance of the bill. The bill is retained by the banker till the date of
maturity. Usually, 30 to 90 days are allowed to the importer for making the payment
of such bills.

(viii) Closing the Transactions:

The last step in the import trade procedure is closing the transaction. If the
goods are to the satisfaction of the importer, the transaction is closed. But if
he is not satisfied with the quality of goods or if there is any shortage, he
will write to the exporter and settle the matter. In case the goods have been
damaged in transit, he will claim compensation from the insurance company.
The insurance company will pay him the compensation under an advice to
the exporter.

IMPORT PROCEDURE AND DOCUMENTATION AT

EAGLEBURGMANN INDIA PVT LTD
EagleBurgmann India Private Limited manufactures mechanical seals. So they require
various types of raw material for the seals as well as various capital goods like the
machines to manufacture the seals. So both the raw materials as well as the capital
goods are imported from various parts of the world.

26
Hence the procedure for import of goods at EagleBurgmann India Private Limited is
as follows:

 PROCESS FOR ORDER OF GOODS

1) Enquiry of raw material is made by the material department of the company.

2) Offer received from the suppliers
3) Purchase order is send to the supplier (in case of advance payment Proforma
invoice is received from the supplier)
4) As per the terms and conditions in the purchase order the consignment is
dispatched by the supplier through a freight forwarder

 PROCESS FOR LOGISTICS AND CUSTOMS CLEARANCE

1) Pre alert of the shipment is received from the freight forwarder/supplier.

2) Importer arranges for a custom handling agent [CHA] to clear the goods from the
customs.
3) The CHA files the advance bill of entry with the customs.
4) Check list of the final bill of entry is sent to the importer by CHA.
5) After receiving the approval from the importer the customs duty is paid by the
importer.

6) After clearance of the goods from the customs the CHA/ Importer arranges for the
transportation of the goods to their desired location.

 PROCESS AFTER ARRIVAL OF THE GOODS.

1) These goods are then received by the receipt stores along with copy of import
invoice, duplicate copy of Bill of Entry and Air waybill.
2) The quantity of the goods is verified according to the purchase order and invoice.
3) Goods are sent to the Quality Control (QC) Department for the quality check.
4) After the approval of the Quality Control department, Goods Received Report
(GRR) is prepared by the receipt stores.
5) The original copy of duplicate copy of the bill of entry, import invoice, packing list
and air waybill is received from the CHA.
6) Duplicate copy of the bill of entry, import invoice, packing list is given to the
finance department to claim CEN-VAT credit.

 PROCESS OF PAYMENT

1) Duplicate copy of the bill of entry, import invoice, packing list and air waybill is
booked by the finance department.
2) The documents required during the payment are: Supplier’s invoice, packing list,
air waybill/bill of lading, A1 form, covering letter to the bank, and duplicate bill of
entry copy
3) After this the payment is done to the supplier through the EEFC account.

 FINDINGS

27
 Comparison of Exports for the last 3 years.

 ON MONTHLY BASIS

2016-2017

MONTHS EXPORTS (IN RS)

April 2016 11984919.38

May 2016 6208900.67
June 2016 8281569.18
July 2016 15555131.21
August 2016 6633248.5
September 2016 9936838
October 2016 7790325.3
November 2016 14683288.55
December 2016 8283953
January 2017 11500876.35
February 2017 9065798.97
March 2017 8825996.25

EXPORTS (IN RS)

18000000
16000000
14000000
12000000
10000000
8000000
6000000
4000000
2000000
0

2017-2018

MONTHS EXPORTS (IN RS)

28
April 2017 11373666.59
May 2017 13800518.51
June 2017 11556916.04
July 2017 47134803.78
August 2017 34734884.78
September 2017 40012062.6
October 2017 18806203.73
November 2017 41768712.43
December 2017 30902676.8
January 2018 11471138.01
February 2018 10412858.75
March 2018 14318982.55

EXPORTS (IN RS)

50000000
45000000
40000000
35000000
30000000
25000000
20000000
15000000
10000000
5000000
0

2018-2019

MONTHS EXPORTS (IN RS)

April 2018 24131910.46

May 2018 4816964.531
June 2018 62300911.04
July 2018 17063759.96
August 2018 24705830.57
September 2018 22095100.38
October 2018 27049714.77
November 2018 31601697.37

29
December 2018 23151290.46
January 2019 3599065.154
February 2019 9800431.964
March 2019 16414225.33

EXPORTS (IN RS)

70000000
60000000
50000000
40000000
30000000
20000000
10000000
0

 There has been an increase in the exports from the year 2016-2017 to
2017-2018, which means that the company has experienced profit during
this period.

 We have also found from the report that there has been a decrease in
exports from 2017-2018 to 2018-2019 because of the project overseas,
which means that which means that the company had not made enough
profit as compared to year 2017-2018.

 The company mostly recommend Irrevocable L/C because it is safe from

the exporters as they will not indulge in any losses and L/C are mostly
used by Bangladesh and Sri Lanka.

 The overall performance of the company is quite good in the field of

exports.

30
100000000
90000000
80000000
70000000
60000000
50000000
40000000 15-16
30000000 16-17
20000000 17-18
10000000
0

2015-2016 2016-2017 2017-2018

MONTHS
APRIL 812350 5383825 4102489

MAY 13921483 11288526 6876338

JUNE 14886067 16460799 9476.70

JULY 13632852 15612339 11671321

AUGUST 11870902 15464855 15522237

SEPTEMBER 8567049 12738745 9780237

OCTOBER 13788787 130550570 7242938

NOVEMBER 33759250 11491481 21699211

DECEMBER 27727248 5935308 9998479

JANUARY 20731430 19020566 31064919

FEBRUARY 20731430 19020566 31064919

MARCH 13758834 30234181 26840630

31
 CHAPTER:07
LIMITATIONS

The study provides an insight into the financial, personnel, marketing and other
aspects of EagleBurgmann. During my internship I gained practical experience in the
EXIM section which is under the finance department.
I tried to perform this project in best possible manner to avoid any lacuna .But still
there are certain limitations in the study. In spite of all my efforts in this regard my
project lacks in some of the following heads.

 Some information being very sensitive as far as organization is concerned is

left untouched and not mentioned in any way.
 Future plans of the company will not be disclosed to the trainees.
 The analysis is based only on the data for the last three years.
 Lastly, due to shortage of time it is not possible to cover all the factors
and details regarding the subject of study.

32
 CHAPTER:08

CONCLUSION

The project is done with the help of mentor and other employees in the finance
department.The study was done on the basis of practical as well as theoretical
knowledge and experience which I gained during my training.

The data for study was used from the year 2016-2019.The methodology was used was
secondary data.

Putting together this report was learning process as it helped me acknowledge how
theory and practically can differ in organizational context.

The actual process of exports was studied practically which helped me to make my
report more clear.

My overall experience at EagleBurgmann was good and I learned lot of new things
which will help me a lot in my future career.

33
 CHAPTER: 09
BIBLOGRAPHY

 Books referred:
Export import procedures - by Jinesh Vadani.

 Websites referred:

 www.businessdictionary.com
 www.wikipedia.com
 www.investopedia.com
 www.eagleburgmann.co.in
 www.tradescraper.com
 www.expertbase.com
 www.internationalchamberofcommerce.com

 Export data from company database for 3 years.

 2016-2017
 2017-2018
 2018-2019

34