Q.What is International Trade ? Various types of International Trade.

International trade is the exchange of goods and services between countries. Its three types are import trade, export trade and entrepot (re-export) trade.

Meaning

International trade (also called foreign or external trade) is the exchange of goods and services between two or more countries. It arises because resources are unevenly distributed and no country can produce everything it needs at the lowest cost. A country exports what it can produce cheaply and imports what it cannot produce efficiently. This is a standard AP Inter 2nd-year Commerce previous-year topic; AP's commerce syllabus aligns with the NCERT/CBSE commerce curriculum here.

Types of International Trade

1. Import Trade — purchasing goods and services from foreign countries for use in the home country. For example, India imports crude oil, machinery and electronics. Import trade may be for consumption or for use as raw materials.

2. Export Trade — selling goods and services produced in the home country to other countries. For example, India exports tea, software, cotton textiles and spices. Export trade earns foreign exchange for the country.

   …