Incoterms for Gujarat shippers: FOB, FCA, CIF and DAP in practice

The Incoterm on your contract decides who pays for each leg of the journey and where the risk passes from seller to buyer. Choosing the wrong one can mean paying twice, or carrying risk you did not expect.

FOB: Free on Board

The seller delivers the goods on board the vessel at the named port, such as Kandla or Mundra. The buyer pays the sea freight and carries the risk from that point. FOB is meant for sea and inland waterway transport.

FCA: Free Carrier

The seller hands the goods to the buyer's carrier at an agreed place, such as a CFS or the seller's premises. For containers, FCA usually fits better than FOB, because the box is handed over before it is loaded on the ship.

CIF and CFR

• CFR: the seller pays freight to the destination port, but the risk passes when goods are on board at origin.
• CIF: as CFR, plus the seller buys minimum insurance cover for the buyer.

DAP and DDP

• DAP: the seller delivers to an agreed place at destination, ready for unloading. The buyer handles import clearance and duties.
• DDP: the seller also clears the goods for import and pays the duties. It is the most demanding term for the seller.

Practical tips

1. Always name the exact place or port after the term, for example "FOB Mundra".
2. Use FCA rather than FOB for containerised cargo.
3. Check who arranges insurance, and whether minimum cover is enough for your cargo.
4. Make sure the Incoterm in the contract matches the one on the invoice and the bill of lading.

How Globelink helps

We check the Incoterm before quoting, so you only pay for the legs you are responsible for. Read about our freight forwarding service, our ocean freight and our customs clearance.