Import customs procedures in India

Customs Procedures

Import Procedures

Traders intending to import goods must submit an application to the Directorate General of Foreign Trade and obtain an Importer and Exporter Code (IEC) number. If the trading firm is considered an EOU/EPZ (Export Oriented Units - Export Processing Zone) (100% of the production is exported), the IEC is issued by the Development Commissioner of the Export Processing Zone. This number has to be indicated on all documents filed with the Indian Customs for customs clearance procedure. This number is not required for the import of gifts and suitcases.
To determine whether a license is needed to import a particular commercial product or service, an importer must first classify the item by identifying its Indian Trading Clarification based on a Harmonized System of Coding or ITC (HS) classification.
After obtaining import licenses, importers are required to furnish import declaration in the prescribed Bill of Entry along with permanent account number (PAN) based Business Identification Number, as per Section 46 of the Customs Act (1962).
All imported goods must meet the terms of the Article 11 of the 1962 Customs Act, the Foreign Trade (Development and Regulation) Act and the EXIM policy in force. Goods that do not fall under the purview of the EXIM policy are generally confiscated or may be reimbursed in exchange for the payment of a fine.

For more information, please visit the Indian Trade Portal.

Specific Import Procedures

Schemes and procedures that facilitate customs clearance include: Electronic Data Interface (EDI), enabling e-payment of duties, implementation of customs Risk Management System (RMS), automation of customs formalities to Special Economic Zones (SEZ).

Certain goods are prohibited under the Foreign Trade (Development and Regulation) Act, 1992.

Importing Samples

Samples for non-commercial use are allowed in case the goods are supplied free of charge.

India is a member of the ATA Convention. Samples are accepted for exhibitions and fairs, whether governmental or private. Goods imported into India under ATA carnets must be re-exported within six months of importation. To stay in India longer than the six month period, obtain approval (1) from the importing customs office; (2) before the six month period expires. In the absence of such approval within the six month period and before the expiry of the six month period, duties, taxes and interest will become payable.

Customs Duties and Taxes on Imports

Customs threshold (from which tariffs are required)

No customs threshold.

Average Customs Duty (Excluding Agricultural Products)

The average customs duty is around 13.6%. For more information, visit World Tariff Profiles 2019 by WTO.

The Central Board of Indirect Taxes and Customs (CBIC) is the apex body for customs matters.

Products Having a Higher Customs Tariff

Alcohol, wines, pet foods, some processed food products, and some manufactured goods are attracting higher customs tariff.

Preferential Rates

Some customs preferences are granted to certain goods imported, subject to conditions. You can consult a list on the website of the Ministry of Finance of India. Preferential rates also apply to imports from those countries with which India has signed special Trade Agreements. For details on Trade Agreements, visit the site of Ministry of Commerce.

Customs Classification

India uses the harmonised system.

Method of Calculation of Duties

Customs duties are levied either as a Specific Rate (prescribed per unit of item) or Ad-valorem (a percentage on CIF value of item), or, sometimes, as a combination of both.

Method of Payment of Customs Duties

Consignment Purchase, cash-in-advance (pre-payment), down Payment, open account, documentary collections, letters of credit.
For more information, visit the site: Indian Customs & Excise Gateway –ICEGATE.

Import Taxes (Excluding Consumer Taxes)

In July 2017, India implemented the Good and Services Tax (GST) system to unify Indian states into a single market and improve the ease of doing business. Before the GST implementation, imports could be subject to an “additional duty,” a “special additional duty,” an education cess (tax), state level value added or sales taxes. Under the new system, goods and services are taxed under four basic rates – five percent, 12 percent, 18 percent and 28 percent.

List of tariffs and local taxes that apply to your product on our service Customs Duties and Local Taxes.