WORLD TRADE
ORGANIZATIONG/LIC/N/3/IND/3
18 October 1999
(99-4469)
Committee on Import Licensing Original:  English
REPLIES TO QUESTIONNAIRE ON IMPORT LICENSING PROCEDURES1
Notification under Article 7.3 of the Agreement
on Import Licensing Procedures
INDIA
The following notification2, dated 14 October 1999, has been received from the Permanent
Mission of India.
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Outline of the system
1. One of the main objectives of the present trade policy of the Government of India is to phase
out quantitative and licensing controls regulating India's foreign trade.  Keeping this objective in
view, the current Export and Import Policy (Exim Policy) (valid for a period of five years from April
1997 to March 2002) has been announced by the Government on 31 March 1997.  Revised edition of
Exim Policy has been brought out on 1 April 1999 incorporating amendments made up to 31 March
1999.
In terms of Export and Import Policy for 1997-20023, all capital goods, raw materials,
intermediates, components, consumables, spares, parts, accessories, instruments and other goods may
be imported without any restriction except to the extent such imports are regulated by the book titled
"ITC (HS) Classification of Export and Import Items"3 or any other provision of this policy or any
other law for the time being in force.
As per the ITC (HS) Classification book, items of import can be broadly classified into the
following three categories:
(i) Prohibited items, imports of which are not allowed under any circumstances;
(ii) Canalised items, which can be normally imported through the designated canalising agencies;(iii) Restricted items, imports of which are allowed against specific import licence called
Restricted Import Licence (RIL) or in accordance with a Public Notice, which indicates the
conditions under which the item can be imported with or without a licence.
Purpose and coverage of licensing
2. Capital goods, raw materials, components, consumables, spares, intermediates, packing
material, parts, accessories, instruments and other goods may be imported without any restriction
                                                     
1 See document G/LIC/3, Annex, for the Questionnaire.
2 Contains information on import licensing procedures as at 1 April 1999.
3 Available for consultation in the Secretariat (Market Access Division).G/LIC/N/3/IND/3
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except to the extent that such imports are regulated by the book entitled "ITC (HS) Classification of
Export and Import Items" or any other provision of this policy or any other law for the time being in
force.  For all the items falling in the restricted category an import licensing system has been adopted.
The policy and procedures governing import of various items is given in the Exim Policy
which is valid for a specified period.  The Handbook of Import-Export Procedures4 is also published
to supplement the Exim Policy.  Importability of an individual item is determined as per the policy
indicated against such items in the ITC (HS) classifications of Export and Import Items.  This
compilation adopts the internationally accepted Harmonized System (HS) of Commodity
Classifications as adopted by the Customs Coopera tion Council (CCC), Brussels.  Some of the codes
have been created even at a ten-digit level so as to provide a distinct existence to certain products.
For the purposes of distinct identity, these codes are called Exim Codes indicating import policy ofthe goods against such codes/products.
Main licensing systems(i) Special Import Licence (SIL):  It is an entitlement which accrues to exporters and which is
freely traded in the market.  These licences are not item specific and any item falling under SIL list as
per ITC (HS) Classification can be imported by the holders of these licences without any further
permission or intimation to the authorities.
(ii) Restricted Import Licence (RIL):  Paragraph 4.5 of the Exim Policy states that any goods
import of which is restricted under ITC (HS) Classification of Export and Import items may be
imported only in accordance with the licence issued in  this behalf.  Application in this regard may be
made to the Director-General of Foreign Trade.  An import licence may be granted by the Director-
General of Foreign Trade or any other licensing authority authorized by him in this behalf.  The
licensing authority may take assistance and advice of an inter-ministerial licensing committee whichconsists of representatives from different administrative Ministries and technical authorities.  These
licences are non-transferable with Actual Users condition.
3. With the exception of Iraq all of India's trading partners receive m.f.n. treatment in the
issuance of import licences.
4. The restrictions on imports of items under Restricted List and SIL List are maintained mainly
on account of balance-of-payments problems (Article XVIII:B of GATT), on grounds of safety,
security and environment protection policies (Article XX of GATT) and for fulfilling commitments
under various international agreements.  In respect of certain items, the conditions for import have
been specified in Public Notices thereby e liminating the need for applying for licences.
5. The foreign Trade (Development and Regulation) Act, 1992 and the Foreign Trade
(Regulation) Rules, 1993 provide statutory authorit y for administering import licensing.  Section 3 of
the Foreign Trade (Development and Regulation) Act, 1992 empowers the Central Government to
make provisions on imports and exports.  Thus licensing is a requirement under these provisionswhich have a statutory backing.  Import of any restricted item is possible either through an import
licence or in accordance with any Public Notice issued on their behalf.  Legislature has given full
authority to the Government for this purpose.  Legislative approval is not required for abolishing the
system.
                                                     
4 Available for consultation in the Secretariat (Market Access Division).G/LIC/N/3/IND/3
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Procedures
6. I. A quota system is not adopted by the Governme nt of India.  Policy and procedure for import
of restricted items is laid down in the Policy and Handbook of Procedure and also available on the
website: http:/www.nic.in/eximpol.  Wide publicity is also given to the Export and Import policythrough the media.  No quota system is maintained so the question of allocating a quota amount to
each country does not arise.  Hence, the quantity and value of imports to be made from different
countries are not published as all countries receive m.f.n. status with the only exception of Iraq.
The Export and Import policy is announced at the beginning of the financial year and remains
valid for a specified period.  The current policy is valid for five years from April 1997 to March 2002.
The Handbook of Procedure is also published simultaneously indicating in detail the procedures to befollowed for making applications for import licences.
II. Imports into India are not restricted through maintenance of quotas.III. This question is relevant only in cases where a quota system is maintained and a quota system
is not operative in India.
IV. As already stated, India does not have quota restrictions on imports.
V. As per policy, a limit of seven working days has been prescribed for issuing of SIL whereas
requests for RIL are processed within a time-period of three weeks since the applications are considered
simultaneously by the Special Licensing Committee.  The time-limit for processing SIL applications is
five working days.  However, applications for spec ial licences mentioned in Paragraph 2(ii) above are
also processed within five days after clearance by a special licence committee.
VI. Import licences are issued with a 12-month valid ity period.  It is up to the importer to import
goods any time during the validity period of the impor t licence.  Import licences are valid for the already
shipped/arrived goods upon making a special request.
VII. Import applications are submitted to the Office of the Director-General of Foreign Trade, New
Delhi or its regional offices, as the case may be.  The practice of routing licence applications through the
sponsoring authorities has been di spensed with.  Such applications are now considered by a Special
Licensing Committee, wherever necessary, constituted fo r this purpose.  There is a single administrative
organ for considering these applications.
VIII. No quota system is maintained in  India.  The import of restricted list items is allowed  on a first-
come, first-served basis and past-performance is ta ken into consideration by the licensing committee in
issuing licences.  There is no maximum limit to be allocated per applicant.  The track record and
financial position of new importers is kept in mi nd while issuing the licences.  The applications are
examined as soon as they are received.
IX. At present, no imports are being made into India under bilateral quotas or export restraint
arrangements.
X. As stated in IX, no imports are made into India on the basis of export permits.
XI. Licences are issued with Actual User cond ition and do not bear the condition that imported
goods should be exported and not sold in the domestic market.
7. (a) The licences are made valid for goods alr eady shipped/arrived at the port of clearance
on the request of applicant.G/LIC/N/3/IND/3
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(b) Yes, if the applicant fulfils the legal requirements.
(c) No, there is no limitation for maximum number of applications for obtaining import
licences.
(d) The importer has to approach the Director  General of  Foreign Trade for an import
licence.  The applicants need not approach other authorities for visa, note or approval.
Only single administrative clearance is required.
8. The licensing authority may refuse to grant an import licence:
(i) if the applicant has contravened any law relating to customs or foreign exchange;
(ii) if it has been decided by the Central Go vernment to canalise imports and distribution
thereof through special or specialized agencies;
(iii) if any action against the applicant is pending under the Foreign Trade (Development
and Regulation) Act, 1992, or rules and orders made thereunder;
(iv) if the applicant fails to pay any penalty imposed on him under the said Act;
(v) if the applicant is not eligible for a li cence in accordance with any provisions of the
Export and Import Policy;  and
(vi) if no foreign exchange is available for the purpose.
The reasons for refusal are generally communicated to the applicant.
Eligibility of importers to apply for licence
9. All eligible persons, firms and institutions can apply for a licence provided they hold a valid
Importer Exporter Code Number (IEC).  There is no sy stem of registration of persons or firms permitted
to engage in importation.
Documentational and other requirements for application for licence
10. The application form indicates the type of in formation and the documents normally required for
processing the application.  The application format  for import of restricted list items is given in
Appendix 8 of the Handbook of Expor t and Import Procedures, 1997-2002.
11. The documents required upon actual im portation besides the import licence are:
- shipping documents;
- commercial invoices;  and
- certificates of origin, if required.
12. Fees are charged on the basis of CIF value of import licence application.  The fees are:  Rs 200
where the value does not exceed Rs 50,000, and Rs 2 fo r every Rs 1,000 or part thereof, subject to a
minimum of Rs 200 and a maximum of Rs 150,000 (where the CIF value in the application exceeds
Rs 50,000).
13. There is no deposit or advance payment requi rement associated with the issue of import
licences.
Conditions of licensing
14. An import licence shall normally be endorsed with a period of validity of 12 months. The
licence may be revalidated on merits for such pe riods as the licensing authority may deem fit.
15. No.G/LIC/N/3/IND/3
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16. Import Licences are issued with Actual  User condition and are non-transferable.
17. Licences for items in the restricted list are issued with Actual User condition unless it is
specifically dispensed with.  No other conditions are attached to these licences.
Other procedural requirements
18. No.
19. Yes.  Foreign exchange is provided by the au thorized dealers in foreign exchange for import of
goods.  However, for import of items appearing in the Restricted List of Imports, an import licence is
required.  Foreign exchange is made available to cover imports.  Normal banking procedures apply forobtaining foreign exchange.
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