📈 Business Guide

How to Do Export and Import Business in India

A comprehensive guide to starting and scaling your international trade business in India

12 min read

Updated: December 2024

Table of Contents

1. Introduction to Export-Import Business 2. Legal Requirements and Documentation 3. Registration Process 4. Market Research and Product Selection 5. Financing Your Business 6. Logistics and Shipping 7. Common Challenges and Solutions 8. Conclusion

Introduction to Export-Import Business

India's export-import business has emerged as one of the most lucrative opportunities for entrepreneurs looking to expand their reach globally. With the government's focus on "Make in India" and various export promotion schemes, starting an import-export business has become more accessible than ever.

💡 Did you know? India's total merchandise trade (exports + imports) reached $770 billion in 2022-23, making it one of the world's largest trading nations.

Whether you're looking to export Indian products to international markets or import goods to meet domestic demand, this comprehensive guide will walk you through every step of establishing a successful export-import business in India.

Legal Requirements and Documentation

📋 Essential Documents

• Import Export Code (IEC)
• PAN Card
• GST Registration
• Bank Certificate
• Digital Signature Certificate

⚠️ Additional Licenses

• RCMC (Registration cum Membership Certificate)
• FSSAI License (for food products)
• Drug License (for pharmaceuticals)
• Textile Committee Registration

The Import Export Code (IEC) is the most crucial document for any export-import business. It's a 10-digit alphanumeric code issued by the Directorate General of Foreign Trade (DGFT) and is mandatory for all import-export transactions above ₹50,000.

Step-by-Step Registration Process

1

Company Registration

Register your business as a Private Limited Company, LLP, or Partnership firm with the Ministry of Corporate Affairs (MCA).

2

Obtain PAN and TAN

Apply for Permanent Account Number (PAN) and Tax Deduction Account Number (TAN) from the Income Tax Department.

3

GST Registration

Register for Goods and Services Tax (GST) through the GST portal. This is mandatory for businesses with turnover above ₹20 lakhs.

4

Apply for IEC

Submit your IEC application online through the DGFT website with required documents and fees (₹500 for online application).

Market Research and Product Selection

Top Export Products from India

Textiles & Garments

Cotton, silk, synthetic fabrics, ready-made garments

Pharmaceuticals

Generic drugs, APIs, medical devices

IT Services

Software development, IT consulting

💡 Research Tips

• • Use trade statistics from DGFT and Export-Import Bank of India
• • Analyze global demand trends using platforms like Trade Map
• • Study competitor pricing and market positioning
• • Understand target country's import regulations and tariffs

Financing Your Export-Import Business

Government Schemes

ECGC Coverage

Export credit guarantee and insurance coverage up to 90% of export value.

MEIS Scheme

Merchandise Exports from India Scheme offering duty credit scrips.

Interest Subvention

Reduced interest rates on pre and post-shipment credit.

Banking Solutions

Letter of Credit

Secure payment method for international transactions.

Export Finance

Pre-shipment and post-shipment financing options.

Trade Finance

Working capital loans and trade credit facilities.

Logistics and Shipping

Key Shipping Terms (Incoterms)

Term	Description	Risk Transfer
FOB	Free on Board	At port of shipment
CIF	Cost, Insurance & Freight	At destination port
EXW	Ex Works	At seller's premises

🚢 Logistics Checklist

Documentation:

• • Commercial Invoice
• • Packing List
• • Bill of Lading
• • Certificate of Origin

Compliance:

• • Customs Declaration
• • Export License (if required)
• • Quality Certificates
• • Insurance Coverage

Common Challenges and Solutions

⚠️ Challenge: Payment Delays

International payments can be delayed due to banking procedures, currency fluctuations, or buyer issues.

Solutions:

• • Use Letters of Credit for secure payments
• • Consider export credit insurance
• • Establish clear payment terms upfront
• • Work with reliable freight forwarders

📋 Challenge: Documentation Complexity

Export-import involves extensive paperwork and compliance requirements.

Solutions:

• • Hire experienced customs brokers
• • Use digital documentation platforms
• • Maintain document templates
• • Regular compliance training for staff

Conclusion

Starting an export-import business in India requires careful planning, proper documentation, and a thorough understanding of international trade regulations. While the process may seem complex initially, the potential for growth and profitability makes it a worthwhile venture.

🎯 Key Takeaways

• Obtain all necessary licenses and registrations before starting operations
• Conduct thorough market research to identify profitable opportunities
• Build strong relationships with suppliers, buyers, and logistics partners
• Stay updated with changing trade policies and regulations

With India's growing economy and the government's support for international trade, there has never been a better time to enter the export-import business. Start small, learn continuously, and scale gradually to build a successful international trade enterprise.