A Presentation onInternational Business Operation ( for Indian Students) : A Presentation onInternational Business Operation ( for Indian Students) Presentation by
Shivgan Joshi & A. Ludhiyani
About this session : About this session Intended for those interested in learning international Business operation (IBO)
An introduction to IGNOU’s course on IBO
Material for MBA Interview on International Business
For all those who plan to work on IBO in near future
Also helpful for those who are interested in improving their General Awareness in International Economics
Class will be taken with the help of Mr. Ludhiyani
Content of Presentation : Content of Presentation International Business Environment
International Business Finance
International business & Logistics
Export Import Procedure
Indian foreign Trade
International business Environment : International business Environment WTO an improvement over GATT arrangements
GATS: salient features and the benefits it brings to developing countries.
The major trends in international trade in recent years
Product-groups have turned out to be the most dynamic product-groups
Recent trends in FDI flows with underlying reasons for the same
Hosmer's model for ethical analysis of management decisions
International trade in commodities and role of UNCTAD is resolving them
GATS obligations : GATS obligations Two main categories of obligations
General obligations which apply to all service sectors of all Members.
Specific obligations which apply only to service sectors specified in the Member’s “Schedule of specific commitments”.
Slide 6 : WTO GENESIS The General Agreement on Trade and Tariff (GATT) came into existence in 1947
It sought substantial reduction in tariff and other barriers to trade and to eliminate discriminatory treatment in international commerce.
India signatory to GATT 1947 along with twenty two other countries
Eight rounds of negotiations had taken place during five decades of its existence
Contd. Downloaded from http://www.manage.gov.in/
Slide 7 : WTO GENESIS WTO Came into existence on 1-1-1995 with the conclusion of Uruguay Round Multilateral Trade Negotiations at Marrakesh on 15th April 1994, to :
Transparent, free and rule-based trading system
Provide common institutional framework for conduct of trade relations among members
Facilitate the implementation, administration and operation of Multilateral Trade Agreements
Rules and Procedures Governing Dispute Settlement
Trade Policy Review Mechanism
Concern for LDCs and NFIDCs
Concern on Non-trade issues such as Food Security, environment, health, etc. Downloaded from http://www.manage.gov.in/
Slide 8 : BASIC PRINCIPLES 1. NON-DISCRIMINATION
MFN (exceptions RTAs, SPS)
National Treatment (exceptions Government Procurement, GATS)
2. MARKET ACCESS
Reduction and binding of tariffs
General elimination of quantitative restrictions on imports and exports
(exceptions Article XX, XXI of GATT Downloaded from http://www.manage.gov.in/
A. What is the WTO? : A. What is the WTO? The World Trade Organisation (WTO)
Established on 1st January 1995
As a result of the Uruguay Round negotiations (1986-1994)
Located in Geneva, Switzerland
Members: 149 countries (as of 11 Dec. 2005)
At its simplest:
“A global organisation dealing with rules of trade between nations”.
(source: WTO)
Evolution of the WTO : Evolution of the WTO Predecessor of the WTO – The GATT ‘47
The General Agreement on Tariffs and Trade (GATT) 1947 -the first major effort to establish international rules governing trade in goods. Though initially conceived as a provisional legal instrument, it endured for almost 50 years.
It functioned without a formal organisational framework to oversee its implementation as the proposed International Trade Organisation (ITO) never came into being and the ITO Charter (aka the Havana Charter) of which GATT was only to be a part, never came into effect.
GATT’s primary focus was the reciprocal reduction of tariffs which later expanded to other trade related areas. In the years leading up to the Uruguay Round, GATT expanded its competence through several rounds of trade negotiations which witnessed the formulation of complex legal instruments on specific aspects of trade, particularly disciplines on the use of non tariff barriers.
The WTO’s functions : The WTO’s functions Administers the WTO Agreements and facilitates their operation and implementation
Provides a forum for trade negotiations among member states on matters covered by the Agreements and for further liberalisation of trade amongst members
Responsible for the settlement of differences and disputes between members
Responsible for periodic reviews of the trade policies of members
Also provides technical assistance and training for developing countries
Cooperates with other international organisations on subjects of mutual interest
Organisational structure of the WTO : Organisational structure of the WTO Ministerial Conference- The apex body for decision making (meets every 2 years). Composition:-ministerial representatives.
General Council- performs the functions of the Conference between meetings and has specific duties assigned to it by the WTO agreements. Composition:- governmental representatives.
The General Council also meets as the Dispute Settlement Body and the Trade Policy Review Body.
Councils for Trade in Goods (oversees GATT), Trade in Services (oversees GATS) and TRIPS which report to and assist the General Council.
Committees on special subjects, Committees functioning under the Councils and Committees for the Plurilateral Agreements.
Membership- developed, developing, least developed countries and
economies in transition.
Decision making is by consensus. If consensus is not possible decisions
will be taken by a majority vote.
(Refer hand out for details)
Terminologies used in IBE : Terminologies used in IBE SAARC
Rybczynsk Theorem
Special Drawing Rights
Difference between: Balance of Trade and Balance of Payments
Most Favoured Nation clause
American Depository Receipt
Transfer of Technology
TNCs operations
Heckcher Ohlin Samuelson theory
Global Trade Point Network
International Business Finance : International Business Finance Euro market: Discuss the Euro market debt instruments
Derivative instruments used for managing currency risk
International fisher effect theory
Nature and significance of world currency market
Terms in IBF : Terms in IBF transaction exposure
SWIFT
Applications of yield Curve
SDRs
Fortfeiting
Euro Bonds
Currency Swaps
LIBOR
Quiz : Quiz What should the spot price for the US dollar be in Frankfurt?
India's Foreign Trade : India's Foreign Trade factors responsible for India not gaining a significant share in global trade
industrial policy of India since 1956; industrial policy since 1991 & its impact on the economy
purpose of formation of SAARC
future prospects of India's trade with the European Union
major items of agricultural exports from India
Indo-Japan and Indo-US trade relations
India -CIS trade relations
export proceeds under Foreign Exchange Management Act
Terms : Terms Buyers' Credit
Special Economic Zones
ECGC And the risks covered
Electronic Data Interchange (EDI)
Export Import Issues : Export Import Issues Discuss various legal documents which are required for exports from India
Analyze India-SAARC trade and its prospects
Analyze the Indo-US trade prospects
features of Commercial Invoice and Bill of tading : exporting your goods under CIF contract
Basic principles of ECGC operation
Role of Export Import Bank of India
Provisions related to regulation and management of foreign exchange under FEMA Act, 1999.
Terminologies : Terminologies Post-shipment finance
Quality control required for export cargo
ISO 9000
International Marketing Logistics : International Marketing Logistics Distinguish between Time Charter and Voyage Charter
Dredging Corporation of India
Common Areas of Maritime Frauds
Principles and factors that govern the liner freight rates
Activities and services provided by International Maritime Bureau
Role of Information Technology in Logistics Management
References : References IGNOU PG programs on International Business Operation