How to import

With the globalisation of Indian economy and consequent upon comfortable balance of payment position Government of India has liberalised the Import Policy and practically all Controls on imports have been lifted. Imports may be made freely except to the extent they are regulated by the provisions of Import Policy or by any other law for the time being in force.

Principle law of import export policy

Imports in to India are governed by Foreign Trade (Development & Regulation) Act 1992. Under this Act, imports of all goods is Free except for the items regulated by the policy or any other law for the time being in force.In exercise of the powers conferred by the Foreign Trade (Development & Regulation) Act 1992 .

Selection of the commodity

Be aware of the import potential and the commercial viability of the commodity/product.

Check whether the items of your interest fall in the Restricted list of ITC(HS) Classifications of Exports & Imports items.
Prohibited items are not permitted to be imported at all. List of Prohibited items of import are detailed below: Tallow, Fat or Oils rendered, unrendered or otherwise of any animal origin, animal rennet and wild animals including their parts and products and ivory any part and products, including ivory. For import of items appearing in Restricted list you need secure import licence. Third category of items comes under the Canalised list of items. Import of items included in Canalised list are permitted to be imported through Canalising Agencies. Thus items not appearing in Prohibited list, Restricted list and or in Canalised list can be imported Freely without any import licence. A large number of Consumer goods are freely importable without licence.

Registration with Regional Licensing Authority and obtaining IEC Code

Registration with Regional Licensing Authority is a

pre-requisite for import of goods. The Customs will not allow clearance of goods unless: The importer has obtained IE Code Number from Regional Licensing Authority. However, no such registration is necessary for persons importing goods from/ to Nepal provided Value of a single Consignment does not exceed Rs. 25000/=

Fees for license application

Rs. 200 where the value of goods specified does not

exceed Rs. 50,000. Rs. 2 per thousand or part thereof subject to a minimum of Rs. 200 and a maximum of Rs.1 lakh 50 thousand, where the value of goods exceeds Rs. 50,000. Rs. 200 where Application is filed be SSI units where the CIF value of goods specified in the application does exceed Rs. 2 lakh. Rs. 200 where application is fro grant of duplicate licence.

Validity of license
Besides import licence for import of restricted items there

are other variety of licences and such licences have different period of validity. Export Promotion Capital Goods Licence validity 24 months Customs Clearance Permit " 12 months For Project/Turnkey Project "18 months or co-terminus with the contracted duration of the Project For the cases where the license expires before the last day of the month, the license shall be deemed to be valid until the last day of that month.

Condition of license
Licensing conditionality: The license for import is taken into consideration provided: the goods covered by the license shall not be disposed of except in accordance with the provisions of the EXIM Policy, 1997-2002 or in the manner specified by the licensing authority in the license; the applicant for a license shall execute a bond for complying with the terms and conditions of the license. It shall be deemed to be a condition of every license for import that no person shall transfer or acquire by transfer any license issued by the licensing authority except in accordance with the provisions of the Policy; the goods for the import of which a license is granted shall be the property of the licensee at the time of import of which a license is granted shall be the property of the licensee at the time of import and up to the time of clearance through the Customs; the goods for the import of which a licensee is granted shall be new goods, unless otherwise stated in the license; the goods covered by the license for import shall not be exported without the written permission of the DGFT;

Selecting the overseas supplier

Successful completion of an import transaction will mainly depend upon the capability of the overseas supplier to fulfil his contract. The credit worthiness of the overseas supplier, his capacity to fulfil that contract, etc. should, therefore, be properly verified before entering into a contract with him. Confidential reports about the supplier may be obtained through the banks and Indian embassies abroad. Reputed overseas suppliers normally have their Indenting Agents with offices in India and contract can also be finalised through them for smoother operations. The importer can also take the assistance of Credit Information Agencies for specific commercial information on overseas suppliers. They may also contact Trade Information Centres of the country concerned.

Finalising the terms of export

Before finalising the terms of Import Order, you should call

for the samples or catalogue and other relevant literatures and the specification of the items to be imported. Import of samples of goods is exempt from import duties under 'Geneva' Convention of 7th November, 1952 The Import Contract should be carefully and comprehensively drafted incorporating therein precise terms, all relevant conditions of the trade deal. There should not be any ambiguity regarding the exact specifications of the goods and terms of the purchase including import price, mode of payment, type of packaging, port of shipment, delivery schedule, etc.

Few other considerations to be taken into account areProduct, Standards and specifications. Quantity. Inspection. Total value of the Contract. Terms of Delivery. Taxes, Duties and Charges payable at Exporting Country and payable in India on importation. Period of Delivery/Shipment. Packing, Labelling and Marking. Terms of Payment-Amount, Mode & Currency. Discounts and Commissions. Licenses and Permits. Insurance. Documentary Requirements. Guarantee. Force Majeure or Excuse for Non-performance of Contract. Remedies. Arbitration.

Mode of payment
Payment under better of Credit is a universally accepted mode of payment. A Letter of Credit is a Signed instrument and an undertaking by the banker of the buyer to pay the seller a certain sum of money on presentation of documents evidencing Shipment of Specified goods subject to Compliance with the stipulated terms and Conditions.

Generally following types of Letter of Credit are in operationRevocable or Irrevocable Letters of Credit Confirmed Credit Transferable Credit With or without Recourse Credit Revolving Letter of Credit Transit Credit Back to Back Credit The Sight Credit The Credit available against Time Draft (Usance Credit) The Deferred payment Credit.

Custom clearance
The process of custom clearance involves various steps1. Arrival of goods and import general manifest 2. Preparing bill of entry 3. Services of customs house agent 4. Presentation of bill of entyry for noting 5. Presentation of bill of entry for appraisal 6. Payment of duty 7. Physical examination as per examination order 8. Release order 9. Confiscation of goods