Export to India: a step-by-step approach
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Congratulations, you have acquired your first Indian customer! You can now start your first export to India. But how do you set this up this in a effective way and what practical matters should you take into account?
1. What documents do you need to export to India?
Indian customs have different document requirements depending on the type of product you want to export (a good overview of the specific requirements for your product can be found here ), but there are three standard documents that are always required:
Bill of Entry
A Bill of Entry provides information on the exact nature, quantity and value of the goods that have landed or entered the country. If the goods are cleared through the Electronic Data Interchange (EDI) system, no formal Bill of Entry is filed as it is generated in the computer system. However, the importer must file a freight declaration for the processing of the clearance of the goods.
If the Bill of Entry is filed without using the EDI system, the importer is required to submit supporting documents including a certificate of origin, inspection certificate, bill of exchange, commercial invoice/packing list. Once the goods have arrived, customs officials examine and assess the information in the Bill of Entry and match it to the imported items. If there are no irregularities, the officials will issue a “pass out order” which will clear the imported goods from customs.
Commercial Invoice/Packing List
The commercial invoice is a sales contract issued by the exporter to the importer. It helps customs determine the value of the goods in order to determine the amount of taxes to be paid. Part of the invoice is the packing list, an itemized list of information about the goods, which must contain the following elements:
- Description of the goods
- Quantity and weight
- Number of packages
- Type of packaging (pallet, box, crate, etc.)
- Marks and numbers
- Name of the carrier
- Date of export
- Export license number
- Bill of Lading / Airway Bill: This is the most important document in the shipping process for exporters. A Bill of Lading is an important legally binding document that, among other things, states the type, quantity and destination of the goods being transported, as well as the details of the shipper, the carrier and the buyer/receiver. For smooth transport of goods from origin to destination and rapid customs clearance, the exporter must obtain a correct and complete bill of lading from the shipping line/freight forwarder and send it to the importer.
From experience we know that the Indian authorities sometimes come up with new, unknown requirements. That is why we advise exporters to work with an experienced Indian importer and/or customs clearance agent. The first time you export a product, you must also pay extra attention to the goods description and the HS code. The first registration is used by the Indian customs as a reference for future similar shipments. If your product accidentally ends up in a different classification (with higher import tariffs), you can no longer change this.
2. How do you temporarily import a shipment into India?
If you google the required documents for temporary import into India, you will quickly come across the ATA carnet. But be aware that the ATA carnet from the Chamber of Commerce only offers you the possibility to temporarily import exhibition material into India. Additional documents are required for professional equipment, trade samples, postal traffic and the transit of goods. A distinction is also made between the temporary import of, for example, a machine (for demonstration purposes) and the import of raw materials for processing into a semi-finished product or end product that is intended for export. Our local experts are always up to date with the latest developments and know exactly what you need to get your products into the country without any hassle.
3. What trade barriers are there in India?
In addition to the high import duties, there is an import ban or strict regulation for some product groups, a good overview can be found here. Increasingly, foreign products must have a BIS registration.
4. What are the import tariffs and import duties for my product in India?
India applies relatively high import duties. On average, the duties are between 27 and 30 percent. The duties are even higher for alcohol, cars and other luxury products. On the other hand, some medical products and many food products are (partially) exempt from import duties. When you sell goods to the Indian government and to five-star hotels, they are usually also exempt from import duties. The high import duties mean that it can be interesting to set up your own factory or production location in India or to outsource production for the Indian market to an Indian party. Do you want to know which import duty applies to your specific product? See here.
5. What requirements must packaging meet for export to India?
All pre-packaged consumer goods (food and non-food) must be provided with an import label at the time of import with the following information:
- Name and address of importer
- General product name or product description
- Net content or quantity (expressed in the metric system: millilitre, litre, gram or kilo)
- Date of import and of production
- MRP: Maximum Retail Price. (This is the consumer price including all taxes for which the product may be sold to the consumer.)
- Specific requirements apply to some product groups, such as food products, see for example here. Other useful information about packaging and labelling requirements that apply in India for specific product categories can be found here.
