Market Entry Conditions

It has already been pointed out that that if there are high tariffs or import quotas or incompatibility of standards in certain markets, it might be desirable to reject those markets. On the other hand, if there are certain preferences available to India, such markets may be more attractive than others. The various types of preferences available to Indian exporter are discussed below:

The Generalized System of Preference (GSP): Under the generalized system of preferences, the developed countries are granting duty free entry or entry at reduced rates to imports coming from developing countries like India. It has been shown that the availability of GSP is definitely helping India’s exports. For example, while the growth of India’s overall exports to United States during 1975-78 was 21 per cent, the growth rate of exports covered under the GSP was as high as 47 per cent. To take advantage of GSP an exporter must know (1) whether his product is covered by GSP (2) the references margin enjoyed by the product, (3) quotas, if any, and (4) procedural formalities to avail him self of the preferences. Information on these points can be obtained from the India Trade promotion Organization, the Ministry of Commerce, and Export Promotion Councils.

Exchange of preferences among developing countries: India is also a beneficiary of preferences exchanged among 16 developing countries. India is also a party to Bangkok Agreement where developing countries of ESCAP are extending preferences to each other on 93 products. It would be useful for an exporter to find out whether his product is covered by these preferences. This information can also be obtained from the same organizations mentioned above.

Some countries have established import promotion centers to promote imports from developing countries and to provide marketing assistance to their exporters. A directory of such import promotion offices and similar organizations has been complied by the International Trade Centre, UNCTAD / WHO and can be obtained from on request. Such import promotions centers exist in Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Hungary, Israel, Italy, Japan, Netherlands, New Zealand, Norway, Poland, Romania, Sweden, Switzerland, Russia, United Kingdom and in many other countries.

The following statements give an idea of the types of service offered by the various import promotion centers:

1. Statistical information on the market concerned
2. Information on sales opportunities in the market concerned.
3. Information on import regulations and procedures.
4. Information on marketing techniques and business practices in the country concerned.
5. List of importers, wholesalers, agents and distributors.
6. Arrangements for contacts for visiting businessmen.
7. Trade fair exhibition assistance.
8. Publications on the market concerned.
9. Names of buyers seeking the product.
10. Training programs
11. Free ads of product offers in weekly trade information bulletin; circulation of product offers to the importers.
12. Showrooms for product display.
13. Answering of initial enquiries regarding exports to the country concerned.
14. Seminars in trade promotion.
15. Promotion of exports through exchange visits.
16. Promotion of films useful for exporters selling to the market concerned.
17. Establishment of national and regional trade information centers in the countries with technical and financial support.
18. Briefing papers and other assistance for trade missions visiting the country concerned.
19. Information on training possibilities in universities and research institutions.
20. Advice and planning for marketing in the country concerned.
21. Trade mark assistance for the market concerned.
22. Occasional combined marketing seminars and trade exhibitions.

We may also examine whether India has got any particular advantage in the market. The advantages may fail in the following categories (1) Proximity, (2) Trade dominated by persons of Indian origin, (3) Ethnic population, (4) Existence of shipping facilities, and (5) Political relations – political factors may hamper business even if the terms offered are more attractive.