Role of EXIM Bank, Reserve Bank of India, Exchange Control in India - FEMA, FEDAI
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One-liners from this chapter
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Define risk in international trade context.
Unplanned event with financial consequences causing loss or reduced earnings due to uncertainty.
What is buyer risk in foreign trade?
Exporter faces non-acceptance, non-payment, quality disputes, buyer insolvency or default.
What is seller risk in foreign trade?
Importer faces non-shipment, poor quality goods, delay after advance payment.
What does shipping risk cover?
Intermediary risks: mishandling, damage, theft, delay by shippers, handlers, transporters.
Define legal risk in foreign trade.
Law changes in seller/buyer country prevent export or remittance of invoice proceeds.
What is country risk and political risk?
Developments in buyer/seller country causing default: war, civil unrest, hostile relations.
What causes operational risk in trade?
Strikes at factory, suppliers, transporters, banks, clearing agents disrupt operations.
What is exchange risk in foreign trade?
Currency movement affecting exporters/importers directly via open position or cost pass-through.
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