Continuously plummeting global crude prices have on one hand further intensified the unpredictability of the political and economic affairs worldwide. And on the other, the abysmally low prices which show no signs of surging upwards have put question marks on the oil and gas industry’s stability in the future. There are numerous factors impinging on the future and the markets of this industry including production glut from the North American shale rocks, ISIS crisis, steep extraction costs in North Sea, and energy policy of US.
Excessive pumping of shale oil by US brought down oil prices spelling disaster for the OPEC countries. To make matters worse, demand for oil has subsided on a worldwide basis as the Chinese and Russian economies are going through a recessionary phase. Saudi Arabia, the most vocal endorser of maintaining the current level of output will undoubtedly be hit hard in the near future but as of now is fighting it out buttressed by $750 billion forex reserves. Other OPEC members are already feeling the pinch. The oil and gas industry is going through its worst crisis since the seventies of the last cent and it seems unlikely that the prices are going to top $100 per barrel anytime soon.
The energy or power generation sector is sitting on the cusp of a change as numerous critical factors and emerging trends are influencing the industry’s future. The private companies and Public Private Partnership (PPP) programs are playing a key role in shaping the future prospects of the energy industry. Governments in most countries is assuming the role of a regulator rather than trying to dominate the power sector.
Introduction of new power generation mechanisms and technologies have made it possible to light up more homes without a significant increase in the production cost per unit. Renewable sources for generating power are also being increasingly tapped into.
International petrochemicals equipment trading entails the sale of the same by exporters to importers across borders. Thus international trade facilitates in commercial transactions between and amongst a couple of or more nations. Trading in petrochemical equipment lead to an increase in the resources of the stakeholders of the petrochemical industry. Exporters of petrochemicals generally export petrochemical products and derivatives, and petrochemical machinery. Conversely, the importers normally import petrochemical items and derivatives, petrochemical equipment and machinery. Importing these helps in the smooth functioning of firms globally and locally. Moreover, the industry may also require and offer services both on a local and global scale.
For instance, a petrochemical merchant or businessman functioning on a local level may think of expanding his business on a global or international scale. This might require him to employ overseas sales representatives and sales agents for promoting the business of the company in foreign countries. This promotion may pertain to selling of petrochemical equipment in the international markets as well as retailing of petrochemical derivatives. Alternatively, the company can hire contract agents or brokers for selling its merchandise. As with international trade in any product or item, trading in petrochemical equipment requires the traders to follow the importing or exporting norms of the different countries.
As mentioned above, these rules are different for each country and the fact that each country has its own bilateral agreements, companies need to stay updated with those specific agreements. These can be accessed and is available on different governmental websites along with specific agencies that have the experience and knowledge of offering assistance to such trades. As this involves a lot of complex paperwork, it is always recommended to avoid any shortcuts or illegal means to procure the products. This may held up a full consignment and can be financially dangerous for both the buyer and the seller.
Importing norms for electrical and mechanical equipment including but not limited to light bulbs, thermostats, irons, televisions, automobiles, gears, and brakes pertain to calculating import tax and duty based on RSP which in turn helps in determining CVD. RSP stands for retail sales price and CVD stands for countervailing duty. To import electrical and mechanical equipment, the importer has to abide by the noise pollution control stipulations of the administration. The air emission norms too have to be followed and importers have to meet the quality control parameters as well.
Some items bracketed under mechanical and electrical equipment might attract antidumping duty as per GATT norms. Ministry of Environment & Forests certification may be required to import mechanical or electrical goods. Many countries require the importer to procure a Foreign Trade License prior to processing an import order. A test or fitness report from an approved laboratory attesting the non-hazardous nature of the imported product should also be produced. Depending upon the foreign trade policies of the country, safeguard duty might also be levied. Government authorization or registration will surely be needed to ply trade as an importer.
When it comes to exporting mechanical and/or electrical equipment like machineries, automotive parts, wires, cables, electrical transformers, fluorescent lamps, electromagnetic couplings, and clutches specific export stipulations have to be followed. For instance, the exporter will have to adhere to government rules; take several precautions before and while exporting, and will be needed to process and maintain particular export documents. The distinct requirements with regards to exportation of electrical and mechanical items are as follows:-
- Permission and approval from MOEF (Ministry of Environment & Forest)
- Adherence to Quality Parameters of the Country Being Exported to
- Port Regulations & Restrictions
- Test or Analysis Report from a Accredited Laboratory
- Licensing Document from Office of Foreign Trade
- Air Emission Standards
- Noise Standards
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