Globalization has indeed made the world a global market. People are now able to buy and sell various products not only within the country but also overseas. It enabled the easy circulation of market things, information and product within the international domain.
Importing allows the person to purchase goods from a foreign country. Every country has its own import policy that puts certain restrictions on the import trade. Here is a step-by-step guide explaining the entire procedure of import trade in India.
Enquiry Of Trade
The first and foremost step in undertaking an import trade is the trade enquiry. You need to send a written request to the exporter asking about their exporting terms. You need to mention all the details of the goods, their quantity, description etc., in this enquiry. The exporter would then send a quotation answering all your queries. Make as many trade enquiries to find the best exporter.
Getting The Import License
You need to have an import license in order to make any type of import. Read the Red Book to know all the terms and conditions before making an import. You need to apply the prescribed form to the licensing authority in order to get your license from the Chief Controller of Exports and Imports.
Getting The Foreign Exchange
The payment to the exporter needs to be made in their country’s currency so it becomes indispensable that you have the desired foreign exchange before making the import. You need to apply to the Exchange Control Department of the Reserve Bank of India in along with your importer license in order to get the foreign exchange from the exchange bank.
Placing The Order Or Indent
Once you are done with all the formalities, you can easily place the order, also known as indent. You can make three types of indent:
Giving The “Letter Of Credit”
This letter of credit, also known as L/C or L.C., is issued from the importer’s bank to the exporter to ensure him/her about the creditworthiness of the importer.
Dispatching Of Order From The Exporters End
Once the exporter gets the L/C, they start arranging the goods and dispatch the order. He sends an ‘Advice Note’ to the importer informing him/her about the details of shipment. The exporter also sends a Documentary Bill to the importer which contains all the necessary documents like bill of exchange, bill of lading, invoice etc.
Getting The Goods Endorsed
You need to get an endorsement for the goods so that you are allowed to take the delivery. You need to get it done at the back of the bill of lading from the shipping company. You can then take the order only after making the full freight payment. Since this process is quite tedious and long, most of the importers appoint a clearing agent in this stage for all the further processes.
Getting Clearance Of Goods
There are many formalities that the importer has to imply in order to get the delivery. Various forms and applications need to be filled for the further process.
Paying The Exporter
Once you have received your order, you would now be required to make the payment as per the terms that were agreed upon in the earlier process. Once all the bills are cleared, the import procedure is complete and the transaction can be closed.
This was the general procedure of import of goods in India. There would be no confusion about importing of goods once you have read this guide thoroughly.
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