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Importing Foreign Cars to India
Mar 30, 2024

Importing Foreign Cars to India: A Guide on Procedures and Rules

Have you ever dreamt of bringing a sleek foreign car to the bustling streets of India? The good news is that it's quite possible. However, it's not as simple as driving the car off a ship. There are rules and steps you need to follow, as well as a list of criteria to meet and charges to pay. Additionally, the owner must comply with legal mandates for motor vehicles in India, such as having vehicle insurance that covers a minimum of third-party liabilities.* If you have a passion for foreign cars and a desire to drive them on Indian roads, then read on to know more about the process involved.

Conditions for Importing a Foreign Car

First, let’s look at the conditions set down for new and used foreign cars to be imported to India.

For importing new foreign cars, the conditions are as follows:

1. The car should be manufactured or assembled in a country other than India. 2. The import must occur from the country where the car was built. 3. The vehicle must be brand new, not having been previously sold, loaned, registered, or leased. 4. It should be right-hand drive, with headlights suitable for illuminating the left side of the road. 5. The speedometer should display speed in kilometres, not miles. 6. Importing is feasible only through naval docks in Mumbai, Chennai, and Kolkata; hence, the car should be imported through these ports only.

For importing used foreign cars, the conditions are as follows:

1. The manufacturing year of the imported used car should not exceed three years. 2. The vehicle must be right-hand drive, with headlights and speedometer conditions similar to that for new cars. 3. Like new cars, importing is possible only through specified naval docks. 4. The car must have been loaned, leased, registered, or sold. 5. The vehicle must be roadworthy and certified as such for at least five years. Also, note that cars with engine capacities ranging from 1,000cc to 2,500cc are not allowed to be imported. Additionally, heavy-duty bikes with engine capacities between 50cc and 500cc and scooters with engine capacities ranging from 250cc to 800cc are also not allowed for import. If you are importing a permitted two-wheeler, make sure to follow all legal specifications and insure it with the right bike insurance policy.

Conditions for Importing a Car While Shifting to India

Foreign nationals or Non-Resident Indians (NRIs) are allowed to import one vehicle while shifting permanently to India. Conditions for such imports are as follows: 1. The person should not have resided in India for at least two years before the transfer. 2. A plan to reside in India for at least one year post-transfer is necessary. 3. The person should not have availed the ‘transfer of residence’ process for three years before the current transfer. 4. Only one family member can undertake this process, by filling out the Transfer of Residence Form. 5. The car should be imported within six months of shifting to India. 6. The sale of the imported vehicle is prohibited for at least two years after the transfer. 7. If the engine capacity of the vehicle is between 75cc and 500cc, then no restrictions of being new or used shall apply. 8. If the engine capacity is more than 1,600cc, a process to register it should be completed at least a year before the import is to take place.

Procedure and Documentation for Import

Cars can be imported directly from the manufacturer or through an agent. The following documents will be required:
  1. Invoice papers
  2. car insurance document
  3. GATT Declaration
  4. Bank draft
  5. Bill of Lading or Sea Waybill
  6. Import license
  7. Purchase order or letter of credit, as applicable
  8. Other documents as required and applicable.
If you take the help of an agent, they may help you throughout the process, until your car is registered within the country.

Major Considerations to Keep in Mind Before Importing a Foreign Car

Before initiating the import process, remember the following points: 1. Import duty on cars varies based on the CIF (Cost, Insurance, and Freight) value, with a 100% customs tax for values over USD 40,000. For used vehicles, the import tax rate is 125%. 2. The vehicle needs to be registered at the nearest RTO in India. Charges for registration and road tax are excluded from the import duty. 3. For the import of commercial vehicles, only certain persons and institutions are eligible. 4. Once the car has been imported, it must be submitted to a recognised testing centre to ensure its compliance with prevailing motor vehicle laws. Thus, the process of importing a foreign car to India is somewhat complex. To protect such a heavily procured car, one must insure it with the right vehicle insurance policy.* Claims are subject to terms and conditions set forth under motor insurance policy.   *Standard T&C apply. Disclaimer: The content on this page is generic and shared only for informational and explanatory purposes. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making any related decisions. Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms, and conditions, please read the sales brochure/policy wording carefully before concluding a sale.

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