Import Checklist India – Must Know Before Importing
Import Checklist India
Before importing goods into India from a foreign country, the importer in India needs to have basic knowledge about the product to be imported, details of the seller, freight charges, customs duty, import restrictions, and other procedures. Importing goods without good knowledge of the above areas could lead to losses or confiscation. This article looks at an import checklist and things to do before import.
List of Restricted Items of Import
Before planning to import any goods or products into India, review the list of restricted items of import into India. If a product is listed on the list of prohibited items by the DGFT, then the product might not be allowed into India or require further clearance for import into India. Hence, before dealing with foreign sellers, it is essential to know if the item is restricted for import into India.
Product Due Diligence
After verifying the product is not placed on the list of restricted items of import into India, you can begin due diligence on the product. First, obtain details of the product you intend to import from the manufacturers or dealers and review technical information, advantages, disadvantages, prices, business terms, delivery, etc. Also, perform domestic research on the product and check if you can manufacture or purchase the product in India at competitive prices, similar products, prospective buyers, etc.; often, it is better to buy products from India than abroad, as the exchange rate risk, seller authentication risk, and shipping risk are significantly mitigated. The following questions can be reviewed while performing product due diligence:
- Scope and demand for the product to be imported into India.
- The end use of the product in India.
- Government of India’s policy and regulation concerning the product.
- Foreign Governments policy concerning the product.
- Experience with similar importers or customs clearance agents while importing similar products.
- Price at which the product will be viable for sale in India.
- Customs duty, freight charges.
- Terms of credit provided by the seller.
- Packaging and transportation costs.
- Licenses and registration are required to import and sell products in India.
Seller Due Diligence
Once you have decided on the product and a list of sellers from whom the product can be purchased, you can begin performing seller due diligence. Information about the seller can be collected from sources like the Chamber of Commerce, Export Promotion Councils, Banks, and publications. The following is a list of references for information about foreign sellers through which seller due diligence can be conducted:
- Consulate Generals, Embassies, High Commissions, and Trade representatives of Foreign Governments in India
- Export Promotion Councils
- International Trade Directories
- Yellow Pages
- Trade bulletins
- Industry journals
- Industry magazines
- Friends and Relatives in Foreign Countries
Before placing an order and wiring money, verifying the overseas supplier’s creditworthiness is essential. Reports on seller creditworthiness can be obtained through banks, ECGC, and Credit Information Agencies (CRISIL, S&P, Moodys, Dunn & Bradstreet, etc.). Also, have a Lawyer vet the purchase contract and ensure that you are sufficiently covered.
Post by IndiaFilings
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