What is cross trade?

Cross trade refers to a type of trade in which an importer or exporter arranges for the transportation of goods or services between two foreign countries without the cargo ever entering the importer or exporter's home country. For example, if a business in India wanted to send goods to Mexico, they may use a cross trade arrangement in which the goods are shipped directly from India to Mexico, without ever going through India or Mexico's domestic markets.

This allows businesses to access new international markets that would otherwise be difficult to do so. Cross trade is also a way to reduce transportation costs and time spent in transit, as goods do not need to be shipped to the home country first before being transported to their final destination.

Cross trade has become increasingly popular in recent years due to advancements in technology and logistics, making it easier for businesses to coordinate cross-border transactions. However, it is important for businesses to carefully consider the legal and regulatory requirements of all countries involved in a cross trade transaction.