Customers in India engaging in import for commercial purposes are required to hold a valid Import Export Certificate (IEC). Without this, customers will have their shipments subject to fine or penalties by the Indian Customs in addition to the normal duty and taxes.
All imports now fall into one of the following four categories: (1) freely importable items; Items in this category do not require import licenses and may be freely imported by any individual or entity. Most capital goods fall into this category. (2) licensed imports; Certain items can be imported only with licenses and only by actual users. The current "negative list" of items in this category includes several broad product groups that are classified as consumer goods; precious and semi-precious stones; products related to safety and security; seeds, plants and animals; some insecticides, pharmaceuticals and chemicals; some electrical items; several items reserved for production by the small-scale sector; and 17 miscellaneous or special-category items. (3) canalized items; Items under this category can be imported only by specified public-sector agencies. These include petroleum products (to be imported only by the Indian Oil Corporation); nitrogenous phosphatic, potassic and complex chemical fertilizers (by the Minerals and Metals Trading Corporation) vitamin- A drugs (by the State Trading Corporation); oils and seeds (by the State Trading Corporation and Hindustan Vegetable Oils); and cereals (by the Food Corporation of India). (4) prohibited items; Only three items-tallow fat, animal rennet and unprocessed ivory-are completely banned from importation.
General documentation required for importation is the following: bill of lading; cargo release order; certificate of origin; commercial invoice; customs import declaration; inspection report; packing list; technical standard/health certificate; and terminal handling receipts.
Liberalisation of the economy since the 1990s has made a significant impact on India’s policy vis-à-vis foreign trade. Import regulations have been eased – both in terms of quantitative restrictions and import duties. Almost all goods are now allowed to be imported into India, except very short list of items banned for import (beef and tallow, fats and oils, animal rennet and wild animals, including their parts and ivory), or those required to be imported through government agencies, or under special license. Import duties, which were previously prohibitively high at levels of 180% or more, have been rationalized to conform to near international levels. (The level of import duty now being as low as 15% for some items.)
Basic Duty
All goods imported into India are chargeable to duty, normally amended at the time of announcement of annual Union Budget. Additional Duty: Also known as the countervailing duty (CVD), is levied on the cost of imported goods and is equivalent to excise duty levied on like goods manufactured in India. Special Additional Duty: Is levied on all goods at the rate of 4%. | 
