Common Objectives of Commercial policy
The commercial policy is a very broad concept. Normally commercial trade is the rules and regulations undertaken by the government of the country to conduct the activities of foreign export and import properly. So to clarify this concept, it is to be noted that, to control the foreign trade, the government takes some specific rules and regulations which are called commercial policy.
Commercial policy means the policy which is declared by the government to control the procedure of import and export at the beginning of the fiscal year. Generally, the main objective of this policy is to create independence by increasing and decreasing the export and import. For this reason, the government declares commercial policy for the particular fiscal year. The objectives of the commercial policy are discussed below:
- Restriction import unnecessary goods
Most countries have to import various types of products and services every year but every product is not equally important for the country. To declare the commercial policy government wants to ensure that unnecessary products and services are restricted to import. Generally, these unnecessary products are luxurious and less useful products.
- Rapid Industrialization
Most countries government tries to import the capitalized produce and new technologies to ensure the rapid industrialization by proper policy for the business. If the country can import the products which are more necessary for the country and avoid the products which are less important, the country will broom more industrialized very rapidly.
- Supremacy in foreign trade
Most countries government are trying to expand supremacy in the foreign country or market by exporting the small and cottage industries products and increasing the rate of value-added tax in the exported products. Otherwise, they try to initiate the necessary steps to increase the export.
- Enhancing Export
Another important objective is to make the commercial policy of developing Countries are to enhance the export, which is the one way to earn foreign currency. So, to be successful in exporting, the problems of this sector should be eliminated. To eliminate these problems some steps should be taken and a proper policy should be prepared and by following this policy these problems could be eliminated and our country can earn foreign currency a lot.
- Creating new market
Most of the industries of developing country are established to capture the local market. So they can not earn the profit and the competition and risks are very high. If the industrialists can create new markets for their products, they can earn more profits and their risks will be eliminated. So the objective of commercial policy of developing Country is to create new markets for the organization.
- Extensive Employment
For the existence of commercial employment, every year some steps are included in order to increase the export rate. So new industries are established and new markets are created. As a result, the amount of export is also increased. To ensure the distribution of these increased products, industrial activities should be enhanced in the country Extensive employment should be created for the unemployed people. Thus commercial policy plays a great role to create employment.
- Enhancing empower equating
Developing Countries has plenty of manpower and this manpower is exported to the other country Commercial policy is made to take the necessary steps in export the manpower and to get the remittance from these people.
- Developing international relation
Foreign trade is made with various countries. As a result, a relation is developed by this system. For foreign trade, various contracts are signed among the countries, culture, and other behaviors are transacted. So a relation is created and developed by the foreign business. To make this relationship more harmonious commercial policy should be made.
At last, we can say that the main objective of the commercial policy is to develop the small and cottage industries and middle and large industries within the country and for foreign trade and to earn foreign currency. To develop the country it is essential to establish industries and increase the earnings from the remittance and foreign currency by exporting the products and services. So, to continue the foreign trade, a proper commercial policy is essential for our country.