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Overview: Why Import & Key Considerations

Importing materials from foreign countries offers Indian businesses access to a wider variety of inputs, potentially lower costs, and the ability to scale operations in ways that domestic sourcing alone may not allow. But with opportunity comes complexity. Importing involves navigating regulatory requirements, customs, foreign exchange, duties, logistics, documentation, and risk. For many small- and medium-sized enterprises (SMEs), errors in the import process can lead to delays, higher costs, or even seizure of goods. This article lays out, step‑by‑step, what a business based in India must do to legally, effectively, and profitably import materials from various countries, from the inception of the idea to the final clearance of the goods, including major compliance and cost considerations.

1. Preliminary Steps & Legal Entity Setup

Before you even place orders with foreign suppliers, there are foundational legal and organisational items to get in place. Neglecting these can lead to serious trouble later on.

Business Entity Registration : You must have a legally registered business in India — this could be a sole proprietorship, partnership, limited liability partnership (LLP), private limited company, etc. The choice affects liability, taxes, documentation, and credibility with banks and foreign suppliers. Proper incorporation or registration ensures the entity can open business bank accounts, enter into contracts, and hold assets.
Permanent Account Number (PAN) : PAN is essential for most financial transactions and is required to apply for many licenses. Without PAN, the DGFT (Directorate General of Foreign Trade) will not issue certain import-export authorisations, and customs will not accept declarations properly. It is one of the non-negotiables.
GST Registration : Goods and Services Tax registration is necessary if your turnover crosses the threshold (or in many cases, even if import or B2B supply). All imported goods are subject to IGST (Integrated GST), besides customs duties. Having GST registration allows you to claim input tax credit on duties & taxes paid, where applicable. Also many regulatory bodies require the business to have GST registration.
Importer‑Exporter Code (IEC) : The IEC is a 10‑digit code issued by DGFT. It is one of the most fundamental pre‑conditions for any import or export from India. Without IEC, customs will not process clearance, banks won’t allow foreign exchange for trade, and other trade facilitation will be blocked.
Opening a Business Bank Account with AD Category I status : You need a current bank account (business bank account) in an Authorized Dealer (AD) bank (preferably AD‑category I), which is authorised to deal with foreign exchange. Payments to overseas suppliers, foreign currency remittances, letters of credit etc., need such banking channels. Your bank will also issue an “AD code” if needed, which is often required for customs and DGFT formalities.
Assessing Regulatory Restrictions / Product Classification : Before selecting what to import, check whether the material is subject to import restrictions, bans, licensing requirements, or whether mandatory standards or certifications (e.g. BIS, FSSAI, CDSCO, etc.) apply. Also determine the harmonized tariff classification (HS code / ITC‑HS in India) of the goods; this determines duties, whether a license is needed, whether the item is restricted.

2. Licensing, Permissions & Compliance Requirements

Once your business is legally set up, the next phase is understanding and securing the permissions and licenses that the particular materials or goods require.

Foreign Trade Policy & DGFT Notifications
India periodically issues Foreign Trade Policy (FTP) documents, which outline what goods are “free” (no import license needed), “restricted”, “prohibited”, or canalized (import only via certain entities). Importers must check the current policy (most recent is FTP 2023) and DGFT notifications to see the status of the goods.
Import License if Required
If the item is not “free”, then you may need a license. Licenses can be general (open) or specific (individual). For example, restricted goods, hazardous materials, chemicals, pharmaceuticals, etc., often need specific DGFT licensing or approval from other agencies. Know the validity period of the license. Usually, different types (capital goods vs raw materials vs spares/consumables) have different licence durations.
Mandatory Certifications / Regulatory Approvals
Depending on what you are importing, there may be regulatory bodies whose approval or certification is needed. For example:
- BIS (Bureau of Indian Standards) for certain products like electronics, LED, steel, toys etc.
- FSSAI for food items.
- CDSCO (Central Drugs Standard Control Organization) for pharmaceuticals and medical devices.
- WPC or Wireless Planning & Coordination for wireless/wireless‑communication devices.
- Environmental clearances if the imported item has environmental impact, or the packaging must meet environmental laws.
- Phyto‑sanitary or animal/plant quarantine certifications if importing agricultural or plant/animal goods.
  Make sure all these are identified well before you place orders.
Certification of Origin, Pre‑shipment Inspection (if required)
Certain trade agreements (Free Trade Agreements etc.) or customs duty concessions depend on whether the goods originate from certain countries. So, certificate of origin may be needed. Also, for some goods or for supplier agreements, pre‑shipment inspection by recognised agencies (SGS, Bureau Veritas, TUV etc.) helps ensure quality and reduce dispute risk.
Customs Valuation, Tariff Rates, and Duty Structure
You need to know how custom duties are calculated: basic customs duty, IGST, social welfare surcharge, anti‑dumping duty, safeguard duty etc. Also, the valuation rules (transaction value, freight & insurance if CIF, etc.). Consult the Customs Tariff Act and schedule, plus CBIC notifications. Misclassifying goods or under‑valuing can lead to penalties, re‑assessment, or seizure.
Foreign Exchange Regulations / FEMA Rules
Since you’ll be paying overseas suppliers, you’ll have to comply with Reserve Bank of India (RBI) & FEMA (Foreign Exchange Management Act) regulations. For example, payment terms, advance payments, letters of credit, repatriation, declaration of imports etc. Some imported goods may require certain documentation to satisfy forex regulations or to file with customs or banks.

3. Sourcing, Negotiations & Contracting with Foreign Suppliers

At this stage, you have legal clearance and compliance basics sorted, you can begin dealing with suppliers abroad. But sourcing and contracting properly is crucial to avoid surprises.

Finding Suppliers & Comparisons
Use trade fairs, online B2B platforms (Alibaba, Global Sources etc.), references, and local networks. Request product catalogues, quality samples, and check references. Consider supplier credibility (years in business, financial stability, certifications). Comparing multiple suppliers helps you negotiate better terms. Always consider lead times, reliability, past export record.
Product Specifications, Packaging, and Standards
Clearly define all product attributes: dimensions, tolerances, material quality, finishing, safety standards. Also packaging: how the goods will travel (sea / air / land), packaging to withstand handling, protection from moisture/corrosion, labelling required (warnings, customs description, country of origin etc.). Mismatches can lead to damage, customs objections, or non‑marketability in India.
Price Terms / Incoterms
Agree on Incoterm (FOB, CIF, DDP, etc.), so both parties know who bears cost / risk at which stage. Price negotiations must cover base cost, packaging, freight, insurance, customs charges in the seller country if any, etc. Clarify currency of pricing (USD, EUR, etc.), payment terms (advance, L/C, wire transfer, etc.). Make sure to build in buffer for fluctuations in freight, currency, regulatory changes.
Order / Contract / Proforma Invoice
After negotiating, issue a proforma invoice to outline exactly what is being bought (quantities, price per unit, total, packaging, freight/insurance if applicable, expected dates). Then formal purchase order or contract. Make the contract clear on delivery schedule, quality standards, dispute resolution, inspection, penalties for defects, responsibility for transit damage, insurance etc.
Pre‑shipment Inspection / Quality Assurance
For large or critical shipments, consider engaging third‑party inspection or test labs to inspect before shipment. This may include sampling, testing, photographic evidence, and sometimes third‑party QC reports. This reduces risk of rejection at customs or by Indian regulators.
Logistics / Freight Forwarding Planning
Determine mode of transport (sea / air / road / multimodal), transit time, cost, and risk. Choose freight forwarders with experience in your trade lanes. Also plan for insurance (marine insurance etc.) to cover loss / damage in transit. Consider port of origin and port of import, transshipment points, possibility of delays.

4. Documentation & Paperwork

Proper documentation is essential; errors here cause delays or increased costs. Below are the key documents, what each is for, and when they are used.

Commercial Invoice / Proforma Invoice
Proforma invoice comes before shipping to define what is being bought. The commercial invoice is issued by the supplier after shipment, stating goods, quantities, values, freight & insurance (if on seller), Incoterm, country of origin etc. Customs uses this for valuation, and banks for payment.
Packing List
Detailed list of what is in each package / container: item description, quantity, weight (gross / net), dimensions, packaging type. Helps customs / freight forwarders check shipment contents, and aids in inland transport.
Bill of Lading / Airway Bill / Transport Documents
This is the transport document, issued by the carrier (ship / airline). It is evidence of shipment, title if negotiable (in case of a negotiable bill), and used at destination for claiming goods. Needed for customs, for claiming insurance, etc.
Certificate of Origin
Shows where the goods were made. May be required by Indian customs, or by Indian authorities to claim preferential duty under trade agreements. Might need attestation by chamber of commerce or authorised agency. Also required by the country of origin for export permits etc.
Import Licenses, Regulatory Permits, Approvals
Any license from DGFT, BIS, FSSAI, CDSCO, WPC etc., NOCs, Certificate of Conformity etc. Must be attached if required. For certain sensitive goods (chemicals, pharmaceuticals, foods), additional inspection reports or laboratory certificates might be needed.
Insurance Certificate
If insurance is part of the seller’s responsibility (under certain Incoterms) or if buyer has arranged insurance. It covers damage or loss during transit. Necessary for claiming losses.
Banking / Foreign Exchange Documents
Documents required by banks for payment: Letter of Credit (if used), SWIFT / wire transfer documentation, certificate of value, proof of import (customs clearance etc.), exchange rate documentation. Also documentation for compliance under RBI / FEMA if required.
Bill of Entry
When the goods land in India, importer or clearing agent must file Bill of Entry with Indian customs. This is a declaration of the goods, their value, classification, origin, etc. It is an official document required under Section 46 of the Customs Act and is mandatory to get customs clearance.

5. Customs Clearance & Duty Payment

After the goods arrive or reach Indian port / airport, the customs clearance process begins. This is where many delays and costs accumulate, so being prepared is important.

Arrival & Import Declaration / Filing Bill of Entry
Once the goods arrive (sea port, airport, land border), the importer (or a Customs Clearing Agent (CHA)) must file a Bill of Entry via ICEGATE or other EDI (Electronic Data Interchange) systems. This includes declaring HS code, quantity, value, origin, pay‑able duties & taxes, regulatory details. If required, submitting additional documentation. Any discrepancy in invoice, description or value can lead to customs holding goods.
Assessment of Import Duties & Other Levies
Indian customs will compute the duties: basic customs duty (BCD), plus any additional duties (anti‑dumping, safeguard), plus IGST (which is calculated on the sum of value + BCD + others), plus social welfare surcharge where applicable. Also, any regulatory or inspection fees etc. Be aware of the rate of IGST for your goods. Tariff schedules are updated occasionally.
Inspection, Quarantine, Testing
Depending on the goods, customs or regulatory agencies may physically inspect goods, check for compliance of certification, labelling or health/safety norms. For agricultural, food or plant products: phytosanitary / quarantine agencies may inspect. For electronics: safety/bis testing. If goods are found non‑compliant, they may be held up, returned, or destroyed. Budget for these contingencies.
Payment of Duties & Release Order
After assessment and inspection, the importer/CHA must pay the duties (some ports allow online payment). After confirmation of duties, customs issues the pass‑out or release order. Only then can the goods be removed from the customs controlled area (port / ICD / airport). Delays in payment or missing documents may delay release.
Transport from Port / Inland Logistics
Once released, arrange for transportation to your storage / manufacturing location. Consider demurrage charges (if goods stay at port too long), storage fees, handling charges. If using bonded warehouses or ICDs (Inland Container Depots), ensure those arrangements are in place. Also coordinate with local transport agents, local taxes (like octroi, local levies), and internal logistics.
Record‑keeping and Audit Compliance
Maintain all documents: invoices, Bill of Entry, customs receipts, inspection reports, licenses etc., typically for at least 5 years (or more, depending on various laws) because government audits, GST audits, customs audits, FEMA investigations might ask for them. Also maintain accurate books of account. Non‑compliance or inability to produce documents can lead to penalties.

6. Costs, Financial Planning & Taxes

Importing involves many cost components besides the price the supplier quotes. Financial planning must account for all of them so that the landed cost is understood and profitability maintained.

Landed Cost Calculation
Landed cost includes: cost of goods (supplier price), packaging, inland transport in origin country, export customs & handling (if any), freight (sea/air/land), insurance, import customs duties and IGST, port handling charges, demurrage, inland transportation in India, local taxes, inspection charges etc. Make detailed cost sheet to avoid cost overruns.
Customs Duties & IGST
As mentioned earlier: basic customs duty varies by product; then IGST is applicable (at rates matching the local GST slab) on the value + customs duty etc. Also, special duties like anti‑dumping if applicable. Staying updated on current tariff notifications (CBIC) is essential because rates may change. Also, some FTAs or trade agreements reduce duties but require proper documentation.
Foreign Exchange Costs
Currency fluctuations can significantly affect cost. If you commit to payment in, say, USD, and rupee moves unfavourably, you pay more. Also bank fees, transfer charges, currency conversion charges. Using hedging instruments or negotiating payment terms (part advance, part after shipment, L/C) helps mitigate risk.
Insurance & Risk Costs
Insurance covers damage, theft, or loss during transit. If your Incoterm makes you responsible up to your port, ensure insurance is included. Also risk of delays at customs, non‑compliance fines, cost of returned or rejected goods, or cost of spoilage.
Storage, Handling, Logistics Overheads
Costs at ports (storage, demurrage), unloading, container handling, local transportation, warehousing in India, inspection, sampling charges. If goods need special handling (temperature sensitive, hazardous etc.), cost increases.
Tax Implications & Benefits
Input tax credit under GST on import duties and IGST paid can often be claimed, subject to rules. Also, many import‑export schemes (like Advance Authorization, EPCG etc.) under the Foreign Trade Policy can provide duty exemption or duty drawback for inputs/ raw materials used in exports. Seek professional advice on whether you can leverage these. Additionally, customs valuation, classification and exemption notifications must be properly recorded to support claims.

7. Handling Logistics, Shipping & Transportation

Materials must physically move from foreign supplier to your business location. Choosing good logistics partners, planning routes, and understanding timelines is very important.

Mode of Transport Selection
Depending on urgency, cost, weight, nature of goods: sea freight (cheapest per kg), air freight (fast but expensive), road/rail (if neighboring country), multimodal. Also consider transport from the supplier’s factory to the port of loading, and from arrival port inland transport in India. For bulky/heavy goods, sea may be only viable; for urgent supplies, air may make sense despite higher cost.
Freight Forwarder / Shipping Agent
Use experienced freight forwarders who understand international shipping, customs formalities, insurance, packaging norms, Incoterms. They can help with documentation, booking, handling during transit, dealing with delays and claims for damage. Evaluate their reliability, past performance, cost.
Insurance & Claims
As mentioned, insure the goods; if something goes wrong during sea voyage (storms, damage), you need recourse. Understand the policy: what delay/damage is covered, how to file claim. Also keep photographic evidence of packaging etc at loading for claims.
Transit Time, Lead Times & Buffer Planning
Always allow for transit delays: port congestion, customs delays, weather, strikes. Also production lead time, supplier delays, shipping schedule variability. Having a buffer helps avoid stockouts or delays in your business.
Customs Port & Entry Point Selection
India has many sea ports, international airports, inland container depots (ICDs). Choosing which port you land things in affects cost (inland transport costs), time (congestion at the port), and risk. Also sometimes certain ports are better equipped for certain kinds of goods (hazardous, refrigerated, large machinery).
Handling Customs Clearance Logistics and CHA
Usually, importers hire a Customs Clearing Agent (CHA) to handle the filings, procedures, payments, and interface with customs authorities. It’s wise to engage a reliable CHA with knowledge in your product category. Good CHA reduces delays, ensures all documents are in order, helps in classification, handles inspections etc.

8. After Import: Receipt, Quality Checks & Compliance

After goods are physically delivered to your premises, there are still steps to take to ensure you really got what you paid for, and that you fulfil downstream compliance obligations.

Checking Quantity, Quality & Specifications
On receipt, inspect that the goods match what you ordered: correct specifications, quantity, no damage. For critical inputs, you may want lab testing, especially if regulatory compliance or safety is involved. Document any discrepancies formally with the supplier — photographs, reports — so that claims can be made.
Labelling, Packaging Regulations within India
Even after import, your product may need to comply with Indian laws on labelling, packaging, safety warnings, consumer information, etc. Wrong or missing labelling can lead to trouble either with regulatory authorities or in the marketplace. Ensure that packaging materials comply with environmental norms (plastic usage, disposal etc.).
Storage & Inventory Management
Proper storage to avoid damage, spoilage etc. If materials are sensitive (humidity, temperature, light, contamination), ensure appropriate storage facilities. Also ensure warehouse compliance with safety / environment regulations.
Customs Bonds / Duty Drawback / Export‑Incentives
If your imported material is an input for an exported product, you may be eligible for duty drawback or under schemes like Advance Authorization / EPCG (Export Promotion Capital Goods), which allow duty-free import of inputs in exchange for fulfilling certain export obligations. To benefit, keep all documentation, file timely, and ensure you meet the conditions.
Accounting and Tax Treatment
Properly account for all costs: landed cost, customs duties, IGST. For GST, ensure correct input tax credit claims. Maintain books in accordance with Indian accounting standards. Record foreign exchange gains/losses properly. The customs duty portion often becomes part of cost of goods sold or inventory valuation. Ensure compliance with yearly tax audits.
Legal / Regulatory Compliance Post‑Import
Ensure any regulatory reporting needed is done. For example, customs may require records for audits, FEMA may require foreign remittance reporting, corporate affairs authorities may require disclosures, environment, waste, safety, labour laws may kick in depending on material type. Stay up to date with any changes in standards / law that might affect your imported materials.

9. Common Pitfalls and Risks, & How to Mitigate Them

Import procedures are fraught with risk. Being aware of what typically goes wrong means you can prepare to avoid these.

Misclassification of Goods / Wrong HS Codes
If you use incorrect HS / ITC‑HS code, you may end up paying wrong duties, or your import may be held for re‑assessment. Also, for trade agreements, wrong origin or wrong code could disqualify benefits. Always cross‑verify classification.
Under‑valuation or Disallowed Invoices
Sometimes suppliers understate value to reduce duty, but customs will challenge low or inconsistent values. Banks and customs will require supporting documentation. Use realistic and transparent pricing.
Non‑compliance with Regulatory Approvals / Certifications
Importing goods without required certifications (for safety, health, food, pharma) can lead to rejection, return at origin, fines, or even destruction of goods. Understanding all regulatory bodies involved early is vital.
Delay in Documentation or Missing Documents
Even one missing document (certificate of origin, license, packing list) can cause customs to hold goods, charge demurrage, or deny import. Ensure documentation checklist is complete before shipment.
Currency / Payment Risks
Currency fluctuations can cause cost overruns. Payment terms that are too favorable to supplier (e.g. large advance payment) carry risk if supplier doesn’t deliver as expected. Also issues with letters of credit / bank delays / foreign exchange limits under FEMA. Use hedging, negotiate various payment terms, use trusted banks.
Logistics / Transit Delays & Damage
Delay in delivery can hurt business operations. Damage during shipping or poor packaging can lead to losses or disputes that are hard to prove. Mitigate by using well‑tested freight forwarders, good packaging, insurance, choosing reliable logistics partners, setting realistic expectations.

10. Key Government Authorities, Regulations & Online Systems

Knowing which government agencies you’ll interact with, what regulations apply, and what online systems exist will save time and reduce surprises.

DGFT (Directorate General of Foreign Trade)
It is largely responsible for foreign trade policy, licensing (import / export), issuing IEC, defining restricted/prohibited goods, trade agreements, tariff preferences, etc. Your primary touchpoint for permission/licensing matters.
CBIC (Central Board of Indirect Taxes & Customs)
This is the authority that manages customs, tariff duty structure, assessment, inspections, online filing of Bill of Entry via ICEGATE, etc. It also enforces customs law, handles anti‑dumping, safeguard duties etc.
Regulatory Agencies (BIS, FSSAI, CDSCO, WPC, etc.)
Specific goods are regulated by different authorities; you will need certification or approval from them. Their requirement may involve lab testing, audit, manufacturing process approval, safety standards etc. Make sure to know which apply for your goods.
RBI / FEMA
For foreign exchange flows, payments abroad, letters of credit, etc., you must comply with FEMA, know regulations for advance payments, foreign remittances, etc. The AD bank must ensure that you're following these rules. Also be aware of any reporting requirements for foreign transactions.
Online Systems & Portals
- DGFT website / ANF2A / IEC portal — for IEC, licenses.
- ICEGATE — for customs filings, Bill of Entry etc.
- CIP (Customs Compliance Information Portal) — to check regulatory / compliance requirements for specific tariff items.
- FoSCoS portal for food safety regulatory import license.
Audit, Compliance & Statutory Reporting
Importers need to maintain books of accounts, assist in customs / GST / income tax audits, also ensure that all regulatory filings are properly done. Cases of non‑compliance can lead to show‑cause notices, penalties, or loss of reputation.

11. Recent / Notable Updates to the Policy (as of 2025)

Policies change fairly often; businesses must stay current. Below are some recent or important updates (as of 2025) to watch out for.

Foreign Trade Policy 2023
The FTP 2023 has updated the Indian Trade Classification (ITC‑HS) system, adopting globally accepted 8‑digit codes and item‑specific conditions. It has refined the classification of goods under “Free”, “Restricted”, “Prohibited”, etc. This influences whether imports of certain materials require licenses.
Revision in Duty Schedules & Tariff Notifications
The Customs Tariff Act and CBIC periodically issue notifications revising basic customs duty rates, anti‑dumping & safeguard duties, social welfare surcharges. IGST rates also see changes. These changes may affect landed cost of imports dramatically. Always check the latest tariffs before import.
Expanded Use of Online Portals / Digital Processes
The processes of IEC registration, license applications, customs filings (ICEGATE), regulatory approvals are increasingly being digitalized. This streamlines process and reduces paperwork delays, but demands that importers be comfortable with online systems.
Increased Regulatory Scrutiny
For certain categories - food, health, chemicals, electronics etc. - inspection, labelling, conformity presumptions, etc., are being tightened. Non‑compliance is being more strictly enforced. Border protection agencies are more vigilant about product safety, environmental impact, consumer protection etc.
Preferential Trade Agreements / FTA Reductions
India has FTAs or preferential trade agreements with certain countries. These can offer reduced duties for imports from those countries, but importer needs proper certificate of origin etc. Be aware of which goods from which countries qualify and whether documentation is in place.
Emphasis on Ease of Doing Business & Compliance Information Portals
E.g., the Customs Compliance Information Portal (CIP) gives importers access to information on compliance obligations for ~12,000 customs tariff items. This helps companies know regulatory & documentation requirements in advance.

12. Timeline & Process Flow (Sample)

To tie all of the above together, here’s a sample timeline / flow that an importing business might expect, along with approximate durations and key action‑points. These are illustrative; actual time may vary depending on goods, ports, and regulations.

13. Practical Tips & Best Practices

Here are some actionable best practices to make the import process smoother, less expensive, and less risky.

Use an Experienced Clearing Agent (CHA)
A skilled Customs Clearing Agent can massively reduce delays and errors. They are knowledgeable about local customs offices, documentation practices, tariff schedules, inspections, and can advise early on likely pitfalls.
Maintain a Robust Document Checklist
Before each shipment, use a checklist of all required documents (for your product category) and cross‑check with supplier. Ensure dates are valid, names/address consistent, values match purchase order and invoice etc. Inconsistencies often cause delays.
Pre‑verify Regulatory Requirements with Indian Authorities
Don’t assume, for example, that just because a product type is commonly imported that approvals are optional. Sometimes new notifications change requirements (labelling, conformity, certification). Check DGFT or CBIC or regulatory agency websites. Use portals like CIP.
Negotiate Flexible Terms
Where possible, negotiate payment terms that share risk: perhaps some portion on delivery, L/C with partial shipment payments etc. Also negotiate Incoterms so that risk / cost loads are clear. Also negotiate packaging standards, insurance etc.
Plan for Delays & Hidden Costs
Always include buffer time in your schedule for customs delays, port handling issues, inspections, etc. Also budget for hidden costs: demurrage, documentation correction, port fees, inland transport surcharges.
Keep Up‑to‑date and Budget for Policy Changes
Duty rates, regulatory requirements, trade agreements can change. Keep monitoring DGFT notifications, CBIC, Ministry of Commerce, regulatory agencies. Build contingencies in your financial planning for duty changes, tax changes, foreign currency changes etc.

14. Case Study or Example (Hypothetical)

To illustrate how all of this works in practice, here’s a hypothetical example of a small manufacturing company in Hyderabad that wishes to import specialized electronic components from Germany.

The company name is “Electro Tech Pvt Ltd.”
They identify a German supplier of a component that meets certain safety and quality certifications (e.g., CE mark). They request sample and test it internally.
They verify via DGFT’s Foreign Trade Policy whether this component is under “Free” or “Restricted” category. Suppose it is free but requires BIS standard certification in India. They arrange for BIS certificate.
They negotiate price, agree on Incoterm CIF Hamburg → Mumbai (port), with insurance included. They also include proper packaging and labelling. Payment terms: 30% advance, 70% on sight of documents.
They ensure IEC, GST, PAN, bank AD‑I account are all ready. They open L/C with their bank. They engage a freight forwarder to book sea freight from Germany to India.
The supplier prepares commercial invoice, packing list, certificate of origin, ensures CE marking, does a German export inspection. Freight forwarder arranges shipping, insurance, shipping documentation.
The shipment sails; arrives at Mumbai port. Electro Tech or its CHA files Bill of Entry via ICEGATE, submits documents: commercial invoice, packing list, bill of lading, certificate of origin, BIS certificate, IEC etc. Customs assesses duty, IGST, possibly physical inspection. Duties paid.
After release, goods transported inland, receive at factory. They check quality and quantity, unpack, store. They complete labelling as per Indian safety norms if needed. Then components are used in their manufacturing. They claim input tax credit on IGST and duties where eligible.

This example shows typical steps, and how delays or cost overruns can creep in if any documentation is missing, or inspection fails, or port delays etc.

Key Takeaway - Importing materials for business use from abroad can unlock competitive advantages, access to high quality inputs, and cost savings. However, the process involves many legal, regulatory, logistic, financial, and compliance challenges. To succeed, an Indian business must invest time and resources in:

Setting up proper legal and financial structure (IEC, GST, AD bank etc.),
Conducting thorough regulatory diligence (licenses, certifications, trade policies),
Selecting reliable suppliers and logistics partners,
Managing and organising documentation precisely,
Understanding and budgeting for all associated costs (duties, taxes, insurance, transport etc.), and
Monitoring changes in policies and staying compliant.

When done well, the import process becomes a reliable and predictable supply chain backbone for the business. It reduces risks of delays, fines, or loss, and improves cost control and competitiveness. Businesses that plan well, follow best practices, use digital platforms and work with competent agents tend to succeed in their import operations.

Import Procedure in India Explained | Licenses, Customs, Compliance & More