Meaning :-

Foreign trade is nothing but trade between the different countries of the world. It is also called as International trade. External trade or Inter-Regional trade.It involves exchange of goods and services between two or more countries.It consists of imports, exports and entrepot. Foreign trade basically takes place for mutual satisfaction of wants and utilities of resources.

The foreign trade can be divided into three groups:

Import Trade

It refers Purchase of goods by a firm in one country from a firm in another country. The inflow of goods in a country is called import trade

Export Trade

It refers to sale of goods by a firm in one country to a firm in another country. The outflow of goods from a country is called export trade.

Entrepot Trade

It is also known as re-export. It refers to purchase of goods by a firm from one country and then selling them to a firm in another country. Many times goods are imported for the purpose of re-export after some processing operations. This is called entrepot trade.