How To Start An Import Export Business In India From The US

To start an import export business in India, knowing how to setup import export business in India properly helps you get IEC, a current account, GST registration, and DGFT compliance. 

As India’s exports crossed USD 825 billion in FY 2024–25, digital transformation is reshaping global trade. Tools like eBRC tracking, automated customs clearance, and cloud-based logistics platforms are helping businesses reduce delays and errors.

This guide explains every step on how to setup import export business in India, from legal documentation to selecting the right export business service. 

You’ll also learn how to integrate DGFT portal services, manage shipping invoices digitally, and secure customs compliance using real-time government filing systems.

Key Takeaways

• An import-export business facilitates international trade by allowing companies to sell domestic goods abroad or source foreign products for local markets, supporting global access, revenue diversification, and foreign exchange growth.
  
  
• Setting up in India begins with registering your business entity and ensuring it's legally structured for international transactions.
  
  
• You must obtain an Importer Exporter Code (IEC) from the DGFT, which acts as your trade license for cross-border operations.
  
  
• A current account with international transfer capability is required to handle overseas payments and currency exchange.
  
  
• Smooth operations depend on customs compliance, GST registration, logistics coordination, and understanding trade regulations for each target market..

What Is an Import-Export Business & Why It Matters

An import-export business involves buying and selling goods or services across international borders. Importers bring in foreign products, while exporters sell domestic goods overseas. 

It enables access to unavailable goods and allows local businesses to expand globally. Whether it's exporting textiles from India to Europe or importing electronics from China, the model supports businesses of all sizes.

Understanding the difference between import and export operations is key to setting up a successful international trade business. The table below outlines how each model functions and what both have in common:

Next, let’s look at why the import-export business matters on a larger scale.

Why Is Import-Export Business Important?

International trade remains a key driver of economic strength and business expansion. For countries like India, engaging in import-export activities not only strengthens the economy but also opens doors for businesses of all sizes.

Here’s how the import-export business plays a crucial role across multiple levels:

• Drives Economic Growth: Increases national income through foreign currency, generates jobs in manufacturing, logistics, and trade, and contributes to GDP and tax revenues.
• Expands Global Market Access: Helps businesses scale beyond domestic demand, build international brand visibility, and reduce dependency on local market cycles.
• Improves Product Availability and Quality: Gives access to goods not produced locally, offers more consumer choices and affordability, and encourages quality through global competition.
• Strengthens Trade Relations: Applies FTAs for lower tariffs, builds diplomatic and economic cooperation, and opens entry to high-value international markets.
• Supports MSMEs and Startups: Government schemes and digital platforms ease market entry, export incentives improve margins, and global access enables small players to compete.
• Increases National Competitiveness: Promotes infrastructure, regulatory, and technology upgrades, drives innovation and compliance, and makes industries more export-ready.

Unsure how to handle India’s import-export regulations? VJM Global helps US companies like yours start and grow their business in India with ease. Get in touch today to simplify your global trade journey!

Now that we’ve seen why the import-export business plays a vital role in global trade, let’s walk through the step-by-step process of setting one up in India.

How to Setup Import Export Business in India: Step-by-Step Setup Guide

An import-export business buys goods from one country and sells them in another, enabling global trade. India’s manufacturing strength, cost efficiency, and digital growth make it a strategic trade partner. With supportive policies and strong global ties, it offers solid opportunities for sourcing and selling.

Step 1: Choose and Register Your Business Structure

Why it matters:
Your legal structure determines tax obligations, liability, and eligibility for government schemes.

How to do it:

• Choose a structure:
  
  • Sole Proprietorship – Simple, but unlimited liability
  • Partnership/LLP – Joint operations with limited liability in LLP
  • Private Limited Company – Ideal for scalability and funding
• Register through the SPICe+ portal (Ministry of Corporate Affairs)
• Obtain Certificate of Incorporation, PAN, and TAN
• Open a dedicated business current account

Documents Required:

• PAN, Aadhaar, Address Proof
• Passport-sized photo
• Digital Signature Certificate (DSC), DIN (for directors)
• MOA/Partnership Deed

Also Read: Choosing the Right Business Structure in India: A Comprehensive Guide for Entrepreneurs

Step 2: Obtain Importer Exporter Code (IEC)

Why it matters:
IEC is mandatory for any cross-border trade or international payments.

How to do it:

• Register on the DGFT portal and fill out the IEC application form online.

• Fill IEC form and upload business documents
• Pay a one-time fee of ₹500

Documents Required:

• PAN of the entity
• Cancelled cheque from current account
• Address proof
• Certificate of Incorporation

Also Read: All about Import Export Code | IEC CODE

Step 3: Register for Goods and Services Tax (GST)

Why it matters:
GST is required for tax compliance and to claim export-related refunds.

How to do it:

• Apply via the GST portal
• Select correct business category (Exporter/Supplier)

Documents Required:

• PAN, proof of business address
• Identity/address proof of proprietor/director
• Cancelled cheque
• Digital signature

Step 4: Open a Business Current Account

Why it matters:
This separates personal and business finances and is needed for international transactions.

How to do it:

• Choose a trade-friendly bank (supporting forex, trade finance)
• Submit KYC, registration proof, and address documents

Tip: Look for banks offering LCs, buyer’s credit, packing credit, and forex hedging tools.

Step 5: Identify Your Product and Target Market

Why it matters:
Right product-market fit assures profitability and compliance with destination regulations.

How to do it:

• Use India Trade Portal, ITC Trade Map, or DGCI&S to research demand, tariffs, and quality standards
• Evaluate profitability, compliance requirements, and shelf-life

Documents Required (if regulated):

• BIS, FSSAI, or other certifications
• Test reports, quality marks
• Country-specific compliance documents

Also Read: Drop-shipping Business: Income Tax Implications

Step 6: Set Up Logistics and Supply Chain

Why it matters:
Smooth logistics are key to meeting delivery deadlines and maintaining buyer trust.

How to do it:

• Partner with reliable freight forwarders and CHAs
• Choose air, sea, or multimodal transport
• Finalize Incoterms (FOB, CIF, etc.) with buyers

Documents Required:

• Bill of Lading / Airway Bill
• Commercial Invoice
• Packing List
• Certificate of Origin
• Advance Payment Proof / Letter of Credit

Packaging Tip: Follow country-specific labeling and packaging guidelines to avoid shipment rejection.

Step 7: Ensure Legal and Customs Compliance

Why it matters:
Non-compliance can lead to penalties, delays, or even business suspension.

What to do:

• File correct Shipping Bills (export) or Bills of Entry (import)
• Declare HS Codes, invoice values, and other customs information
• Pay applicable duties like IGST, BCD
• Claim GST refunds on exports via the GST portal

Coordinate with:

• DGFT – Policy and IEC
• CBIC – Customs & taxation
• Regulatory bodies – FSSAI, CDSCO, BIS (based on product)

Step 8: Secure Trade Financing and Manage Forex

Why it matters:
Long export cycles can strain working capital. Forex fluctuations also affect margins.

How to do it:

• Apply for:
  
  • Packing credit, pre-shipment finance, post-shipment finance
  • Buyer’s credit, letter of credit, or invoice factoring
• Hedge currency risk using forward contracts

Documents Required:

• IEC and GST Certificate
• Export orders/invoices
• Turnover proof
• KYC documents

Tip: Letters of Credit can improve your credit score and loan eligibility with banks.

Step 9: Use Trade Tech for Operational Efficiency

Why it matters:
Manual processes increase errors and reduce scalability.

What to implement:

Step 10: Comply with Global Standards and Trade Agreements

Why it matters:
Products rejected at foreign ports due to non-compliance can lead to massive losses.

How to do it:

• Use the WTO Tariff Database and DGFT notifications
• Check FTAs like India-UAE CEPA, India-ASEAN FTA
• Obtain necessary certifications:
  
  • Certificate of Origin, AEO certificate, safety certifications

Work with:
Export Promotion Councils like FIEO, APEDA, EEPC for documentation and market access.

Step 11: Monitor KPIs and Scale Strategically

Why it matters:
Sustainable growth requires performance tracking and adaptability.

Key KPIs:

• Shipment turnaround time
• Order fulfillment rate
• Repeat buyer percentage
• Margin per shipment
• Customer satisfaction score

Growth Strategies:

Step 12: Mitigate Business Risks Proactively

Why it matters:
Global trade is vulnerable to regulatory, supply chain, and financial risks.

Risk Management Tips:

• Use Marine, Cargo, and Trade Credit Insurance
• Monitor updates on DGFT, CBIC, and Commerce Ministry portals
• Set up backups for suppliers, logistics, and buyers
• Conduct third-party product inspections
• Use cybersecurity protocols for transactions and data

Even with all the right steps in place, your import-export business is still influenced by several external forces. Understanding these variables is crucial for building resilience and staying competitive in global markets.

Also Read: Benefits of Registering a Business in India

To effectively measure and scale your export business, partnering with experts like VJM Global can provide the essential support you need for smooth operations in India.

How VJM Global Supports Your Import Export Business Setup in India?

Starting an import-export business in India requires expert guidance to manage legal, financial, and operational complexities. VJM Global offers specialized services that directly support these needs for U.S. companies expanding into India.

Key ways VJM Global helps include:

• Company Registration: Simplifies setting up your business with full compliance to Indian laws like FEMA, RBI, GST, and MCA.
  
  
• Accounting Outsourcing: Handles bookkeeping, financial reporting, tax prep, and reconciliations, reducing your operational costs and eliminating the need for in-house teams.
  
  
• Audit Support for CPA Firms: Provides offshore audit assistance aligned with U.S. accounting standards, helping firms manage peak workloads cost-effectively and securely.

By partnering with VJM Global, you get reliable offshore support that optimizes your import-export business setup, make sure regulatory compliance, and optimizes financial management, allowing you to focus on growth and expansion in the Indian market.

If you’re a U.S. company expanding to India, VJM Global helps you optimize setup, make sure compliance, and cut costs! Get in touch today to simplify your India entry!

FAQs

1. What licenses are required to start an import-export business in India?

A: You need to obtain an Importer Exporter Code (IEC) from the DGFT, which is mandatory for cross-border trade. Depending on the product, additional licenses like FSSAI, APEDA, or BIS may also be required.

2. How do I choose the right product for export or import?

A: Analyze international demand trends, competition, and profitability using tools like ITC Trade Map or India Trade Portal. Consider ease of sourcing, perishability, and compliance requirements when finalizing the product.

3. What are the main compliance requirements for exporters in India?

A: Exporters must comply with GST regulations, file shipping bills, maintain e-invoicing where applicable, and adhere to destination country requirements. Timely documentation and audit readiness are key to avoiding penalties and delays.

4. How can I find international buyers for my products?

A: Use B2B platforms like IndiaMART, Alibaba, and Export Genius, or participate in global trade fairs and EPC-led buyer-seller meets. Building credibility through certifications and consistent product quality is crucial for long-term buyer relationships.

5. What are some KPIs to track export business performance?

A: Key metrics include shipment cycle time, order fulfillment rate, profit margin per product, and repeat order rate. Monitoring these KPIs make sures you identify bottlenecks and make informed scaling decisions.