How to Start an Import Business in India

To start an import business in India you need a product you are allowed to import, a registration that customs and your bank recognise, a supplier you can trust and enough cash to pay for goods, freight and duty before you earn anything. None of the rules is hard to find, but they sit in several places: the Foreign Trade Policy, the Customs Act, the Reserve Bank of India's rules for import payments and the GST framework. This guide puts them in the order you will meet them. It gives eight steps, a made-up first-order budget, a timeline of when the money leaves your account and the mistakes beginners make.

For the customs side, see customs clearance in India step by step. For the supplier side, see how to find reliable suppliers in China.

Step 1: Check That You Can Import the Product

Start with the product, not the paperwork. India's Foreign Trade Policy 2023 says imports are free except where regulated by prohibition, restriction or exclusive trading through State Trading Enterprises, as laid down in the ITC (HS), and that the lists can be viewed under Regulatory Updates on the DGFT website. The import policy is shown against each item in the tariff, so you need the product's classification to read it. Para 2.08 says restricted goods may be imported only under an authorisation or permission, and para 2.03 applies the domestic standards, safety and health norms for Indian goods to imports as well. If the goods are second-hand, para 2.02(d) points to a separate regime in para 2.31. Our guide to what an HS code is shows how to find the classification.

Step 2: Get Your Legal Identity and the IEC

The Foreign Trade Policy says no import may be made without an Importer-Exporter Code unless specifically exempted, and that the IEC is the same as the entity's PAN. The Handbook of Procedures says you apply online in the ANF-2A format through the DGFT website with the applicable fee, a cancelled cheque or bank certificate, and an address proof. The IEC is then generated and can be downloaded, and it has permanent validity unless suspended or cancelled, subject to the yearly update in April to June. Read our guide to the importer exporter code before you apply, and use the DGFT IEC page for the current process.

Step 3: Register for the Systems You Will Use

The customs portal. ICEGATE lists registration, electronic filing, e-payment and enquiry among its services, and your broker or you will file the bill of entry through it.
GST, where it applies. CBIC's guidance note for importers, issued ahead of the 2017 GST rollout, advises quoting the GSTIN in the bill of entry in addition to the IEC. Whether you must be registered for GST depends on your own sales, so ask your tax adviser.

Step 4: Arrange Payment Through a Bank

Import payments go through a bank. The Reserve Bank's Master Direction on the Import of Goods and Services, updated as of January 2026, says Authorised Dealer Category I banks may allow remittances for imports after ensuring that the importer has given all the requisite details and that the remittance is for a bona fide trade transaction, and it tells the banks to follow the know-your-customer guidelines. Four rules matter to a beginner:

Remittances against normal imports should be completed within six months from the date of shipment, except where amounts are withheld as a guarantee of performance.
For an advance remittance above USD 200,000 or its equivalent, the Direction asks for a standby letter of credit or a bank guarantee. For importers other than public sector bodies that cannot obtain a guarantee from the supplier, the bank may waive that for advances up to USD 5,000,000 if it is satisfied with the importer's track record and bona fides.
Third-party payments are allowed only on conditions, including a firm purchase order or agreement and a narration on the invoice.
After the goods are cleared, the bank has to receive evidence of import, such as the bill of entry number, port code and date.

Ask your bank how these rules apply to your order before you pay anything.

Step 5: Find and Verify a Supplier

Treat every new supplier as unproven. The Embassy of India in Beijing's advisory for Indian SMEs recommends checking the credentials of the Chinese entity before doing business, keeping copies of the identity card and passport of its proprietor, collecting a copy of the business licence, and avoiding transactions with companies found on B2B platforms. Our guide to reliable suppliers in China covers the checks in full.

Step 6: Work Out the Landed Cost

The supplier's price is only part of what you pay. Customs duty follows the classification under Section 12 of the Customs Act, 1962, the value includes transport and insurance as the rules provide under Section 14, and integrated tax is charged on the value plus the duty. Our guides to landed cost and to import duties and taxes show the arithmetic.

Step 7: Agree the Terms and the Documents

Agree the trade term in writing, because it decides who pays freight and insurance and who carries the risk. See EXW vs FOB vs CIF. Then agree the documents. The Foreign Trade Policy lists a transport document, a commercial invoice cum packing list and a bill of entry as mandatory, and our guide to the documents required to import goods into India shows the rest.

Step 8: Appoint a Forwarder and a Broker, Then Ship

A forwarder moves the goods, and a customs broker, who must be licensed under Section 146 of the Act, deals with customs for you. You can also present the bill of entry yourself. See customs broker vs freight forwarder for how to divide the work.

Close-up of a person's hands typing on a keyboard at a desk — Registration, payment and customs filing are all done online. Photo: jevgeni mironov on Unsplash

A Made-Up First-Order Budget

The figures below are made up. They show how far the cash needed can exceed the supplier's invoice.

Item	Amount in rupees
Goods (supplier's invoice)	5,00,000
Freight and insurance	55,000
Customs duty at 10% on 5,55,000 (made-up rate)	55,500
IGST at 18% on 6,10,500 (made-up rate)	1,09,890
Clearance and port charges	15,000
Delivery inside India	10,000
Contingency	25,000
Total cash needed	7,70,390

In this example the cash needed is 2,70,390 more than the invoice. If you are registered for GST, you may be able to use the IGST as credit, which changes the net cost but not the cash you need up front. Ask your tax adviser.

When the Money Leaves Your Account

Stage	Cash out	What sets the timing
Order placed	Advance to the supplier, if agreed	The RBI conditions on advance remittances
Cargo ships	Balance of the supplier's price, as agreed	Remittance within six months of shipment
Bill of entry filed	Duty and IGST	Section 47(2): on presentation of a self-assessed entry
Cargo arrives	Port, clearance and delivery charges	Commercial charges
After clearance	Evidence of import to your bank	The RBI Direction

Mistakes Beginners Make

Ordering before checking the import policy for the product.
Sending an advance to a supplier whose credentials have not been checked.
Budgeting for the goods and the freight but not the duty and IGST.
Letting the IEC lapse by missing the April to June update.
Not naming who files the export declaration in China and who files the bill of entry in India.
Choosing a trade term without checking what it makes you responsible for.

A Start-Up Checklist

The product's classification and import policy have been checked.
The IEC is issued and active, and ICEGATE access works.
A bank has confirmed how it will handle your import payments.
The supplier has been verified, and the contract names the documents.
The landed cost has been calculated and the cash is available.
A forwarder and a broker are chosen, and the broker has your signed authorisation.

Start Importing With RR Brothers and Logistics

RR Brothers and Logistics helps new importers plan the first shipment, from document checks to customs clearance, with sea freight and air freight from China. Send us your plans and we will map the steps for your product.

Frequently Asked Questions

Imports are free unless the Foreign Trade Policy regulates them. You need an IEC, and for restricted goods an authorisation or permission. Check the policy status of your product first.

There is no fixed figure. You need the supplier's price, freight and insurance, customs duty and IGST, clearance and delivery charges and a contingency, as the made-up budget shows.

The IEC is the mandatory registration for import. CBIC advises quoting the GSTIN in the bill of entry where you are registered. Whether you must register depends on your sales, so ask your tax adviser.

Through an Authorised Dealer bank, which checks your details and the bona fides of the transaction. The RBI Direction expects remittances against normal imports within six months of shipment and sets conditions on advances.

Goods that the ITC (HS) lists as prohibited, restricted or traded only through State Trading Enterprises. DGFT publishes the lists under Regulatory Updates.

Not by law. Section 46 lets the importer present the bill of entry, and you can appoint a licensed customs broker if you prefer.

Sources

This article is general information, not legal, tax or customs advice. Rules, rates and procedures change; confirm current requirements with the relevant authority or a licensed customs professional before you ship. Regulatory references were checked against the official sources listed above on 26 October 2026.

Image credits: header photo by Ian Taylor on Unsplash; photo by jevgeni mironov on Unsplash. Used under the Unsplash License.

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How to Start an Import Business in India: A Beginner's Guide