What is meant by international Trade

According to J.L. Hanson – An exchange of various specialized commodities and services rendered among the corresponding countries is known as international trade.

According to V.M. Memani – International trade is a trade among different countries or trade across political frontiers.

According to M.C. Vaish – Foreign trade may be defined as the exchange of goods and service among the citizen of independent or sovereign states or countries.

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Feature

• Different of market system
• Different in national boundaries
• Foreign currency and rate of exchange
• Immobility of factors
• Import-export
• Balance of payment
• Various cost
• Dependency
• Trade and control

Causes

• Mobility of factors of production
• Different of climate
• Human capability
• Natural resources
• Market system
• Trend of economic development
• Expansion of market
• Knowledge of technology and technical
• Availability of capital and capital elements
• Difference in quality and price

Merits

• Export opportunities of product and services
• Expansion of industry
• Optimum utilization of resources
• Consumption of unproduced goods
• Specialization of labor
• Creating employment opportunities
• Increase efficiency of local entrepreneurs
• Increase international co-operation
• Increasing investment
• Progress in technological know-how
• Development of standard of living

Importance

• Facility to consume deficit or unproduced goods
• Opportunity to export surplus products
• Expansion o market and economic development
• Advantage of consuming goods at a low price
• Creating employment opportunities
• Ensuring optimum use of resources
• Developing the quality of product
• Development of standard of living

Demerits

• Import harmful and unnecessary goods
• Adverse conditions of trade
• Increase dependency
• Unequal competition and dumping
• Problems on excess production
• Excess uses of natural resources
• Barriers to balanced and local expansion of industries
• Expansion of imperialism
• Create international conflict

Documents used

1. Shipping document

• Bill of exchange
• Bill of lading
• Insurance policy
• Invoice
• Certified invoice
• Certified of origin

2. Non-shipping document

• Indent later
• Letter of credit
• Shipping report
• Charter party
• Pro-forma invoice
• Trust receipt
• Respondent bond
• Latter of indemnity
• Mates receipt
• Dock receipt
• Dock warrant
• Bill of exchange
• Shipping advice
• Bill o sight
• Sales contract
• Bottamary bond

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