Why export pricing is different
A domestic price assumes your usual delivery. An export price has to say exactly where your responsibility ends: your gate, the Indian port, or the buyer's warehouse. Each step adds cost and risk. Buyers compare quotes on the same basis, so a price without a clear delivery term is hard to compare and easy to lose on.
Build the price, layer by layer
| Layer | What it covers |
|---|---|
| Ex-works (EXW) | Your factory cost plus margin, with export packing. The buyer collects from your gate. |
| + Inland transport | Factory to port or airport. |
| + Export clearance and port costs | Customs broker, documentation, terminal and handling charges. |
| = FOB (Free On Board) | Goods loaded on the ship at the Indian port. The most common quote for sea freight. |
| + Sea freight | Port of loading to the destination port. |
| = CFR (Cost and Freight) | You pay freight to the destination port; risk still passes at loading. |
| + Marine insurance | Cover for the goods in transit. |
| = CIF (Cost, Insurance and Freight) | You pay freight and insurance to the destination port. |
Get real quotes from a freight forwarder and customs broker for your product and port. Guessed freight is the most common reason export quotes turn out loss-making.
Try it with your own numbers: export price calculator →
Choose the Incoterm
Incoterms are the International Chamber of Commerce's standard delivery terms. The current edition is Incoterms 2020, with eleven rules. Always write the rule, the named place and the edition, for example “FOB Nhava Sheva, Incoterms 2020”.
Any mode of transport
| Rule | Name | What it means for you |
|---|---|---|
| EXW | Ex Works | The buyer collects from your premises and handles everything, including export clearance. |
| FCA | Free Carrier | You hand the goods, export-cleared, to the buyer's carrier at an agreed place. |
| CPT | Carriage Paid To | You pay transport to the destination; risk passes when you hand over to the first carrier. |
| CIP | Carriage and Insurance Paid To | As CPT, plus you insure the goods in transit. |
| DAP | Delivered at Place | You deliver to a named place in the destination, ready for unloading; the buyer pays import duties. |
| DPU | Delivered at Place Unloaded | As DAP, but you also unload the goods. |
| DDP | Delivered Duty Paid | You deliver, cleared for import with duties paid. The most work and risk for you. |
Sea and inland waterway only
| Rule | Name | What it means for you |
|---|---|---|
| FAS | Free Alongside Ship | You place the goods alongside the ship at the Indian port. |
| FOB | Free On Board | You load the goods on the ship at the Indian port; risk passes once they're on board. |
| CFR | Cost and Freight | As FOB, and you pay sea freight to the destination port. |
| CIF | Cost, Insurance and Freight | As CFR, plus you insure the goods at sea. |
FOB, CFR and CIF are meant for goods loaded directly onto a ship. For containers you hand over at an inland depot, FCA, CPT or CIP fit better.
Not sure which fits? Incoterm picker →
Account for incentives and tax
- GST: exports are zero-rated. File a Letter of Undertaking (Form RFD-11) each financial year to export without paying IGST.
- RoDTEP (Remission of Duties and Taxes on Exported Products) refunds some embedded taxes as a percentage of FOB value, at rates set by DGFT per product. It is currently extended to 30 September 2026; check DGFT for any further extension and for your product's rate.
- Duty drawback can refund customs duty paid on imported inputs.
Treat incentives as a bonus rather than building them into the price. Rates and deadlines change, and a price that only works with an incentive becomes loss-making the day it lapses.
Quote in the right currency
Most export prices are quoted in US dollars, sometimes euros or the buyer's currency. Build in a buffer for exchange-rate moves between quote and payment, and state how long the quote is valid, for example 30 days.
Make a price sheet before buyers ask
Prepare FOB prices for your main items, the MOQ, lead time, packing details (units per carton, cartons per container) and quote validity. When a buyer asks for prices, you can reply the same day, which is one of the strongest signals of a serious supplier.
Not sure if you're ready overall? Take the export readiness checklist.
Questions
Which Incoterm should a first-time exporter use?
FOB for sea freight and FCA for air or containers handed over inland are the usual starting points: you control the Indian side, which you understand, and the buyer handles the international leg and import. Avoid DDP until you know the destination's import rules well.
Is FOB the same as ex-factory price?
No. FOB includes getting the goods to the port, export clearance and loading, on top of the ex-works price.
Should I include GST in my export price?
Exports are zero-rated for GST. With a Letter of Undertaking filed on the GST portal, you export without paying IGST, so GST should not sit inside your export price.
Is there an Incoterms 2030?
Not yet. Incoterms 2020 remains the current edition; ICC has started work on the next revision but hasn't published new rules.