Rating Service For Exporters Soon

The rating system is designed to judge an exporter's capability, reliability and readiness to meet certain obligations, standards, expectations and specifications in a competitive scene.

This will offer foreign buyers a way to assess the relative capabilities of exporters to fulfil their export obligations, said IIFT director general P L Sanjeeva Reddy while introducing the scheme.

MDRA chairman N Bhaskar Rao said the scheme will encourage exports, provide superior information, lend a marketing edge and facilitate collaborations for export houses.

Under the scheme, a team from these institutes will undertake a detailed examination of an export house on several pre-determined parameters and grade them as excellent, good, satisfactory, low-risk and high-risk companies.

 

The parameters include market standing of the organisation, promoter's background, past performance, key organisational strengths, export logistics etc.

The cost of the service is expected to be Rs 20,000 (plus expenses) for companies with a turnover of upto Rs 1 crore and a maximum of Rs 50,000 depending on the turnover of the company for larger firms. The costs and profits will be shared equally between IIFT and MDRA.

At present, the service is available for four sectors - textiles and garments, computer software, processed foods and engineering, which account for 80 per cent of India's exports.

The service will be available to other sectors in 1997. This is available to manufacturer and merchant exporters on a voluntary basis. The eight broad parameters to be used are market standing, export plans, global positioning, organisation in place, infrastructure in place, product strength, distribution arrangement and financial commitment. Within these eight heads, 105 parameters will be used for assessment.

The service is expected to be used by exporters and foreign buyers, buying agencies, technology suppliers, foreign missions and financial institutions.

It is envisaged that the service can also be used by international buyers to locate reliable vendors, by vendors to locate quality buyers, by financiers to assess the credit risk of the exporter, by investors to assess the risk and return associated with the exporting organisation and by insurers to assess the insurance risk associated with the export house.

On the request of the rating service, the exporter will be required to furnish detailed information to IIFT-MDRA and after a preliminary analysis of the information an expert team from these organisations would visit the company for a detailed on-site appraisal. Confidentiality of information is assured.

Commerce ministry sources said the scheme was much-needed and often on foreign visits ministry officials are asked to supply lists of exporters it is safe to deal with. This kind of a rating will enable the ministry to provide such a list in future.