Importing used car to India is one of the biggest hassles every NRI faces. In this article, I’ll show you how to import used cars to India, hassle-free and easy.
One of the largest economies in the world, India certainly loves luxury.
And, what could represent a luxurious lifestyle more than a swanky imported car? With rising incomes and the growth of the aspirational millennial population in the country, several luxury brands have already entered the Indian markets, with Audi even launching its own manufacturing unit in Aurangabad.
But, when the statement made by luxury cars easily available on the Indian market isn’t enough, the rich and the restless look to import their dream car (that’s you and me lol).
If one wants to ride a muscular Mustang, for instance, it would be possible only by importing the car from the US.
If you wish to import a used or salvaged car from USA, you will first need to comply with all the rules set by the Indian government regarding automotive export and import.
For instance, during the process of importation, you should remember the total customs duty on cars can come to around 181%.
The car can only be imported if you are transferring residence into India and the engine capacity is less than 1600 cc (for new cars), there is no cc limit for old and used cars, in your possession for more than one year.
In this article…
Importing a used car to India – How to Prepare
The first step of importing your used car to India is to prepare – both mentally and physically. The car and yourself.
Make sure that you research well before you make a decision and do not make hasty mistakes.
Conditions for Importing Used Cars to India
Next up, you need to know the conditions for importing used cars to India, according to Indian Govt.
The car should be built outside India.
Country of manufacture
The car must be imported from the country of manufacture.
The car must be of a single owner. It cannot have been previously sold, loaned, registered, or leased.
Right hand drive
It must be a right-hand drive.
The car’s headlights should be able to illuminate the left side of the road.
The speedometer should indicate km/h instead of mph.
Age of the car being imported:
The used vehicle must not be more than 3 years old from the date of its manufacture (for cars made in the USA, it is 2 years). Having said that, there are some issues regarding the age of a particular vehicle of import from the US. The roadworthiness should be 5 years.
The second-hand car must have a right-hand drive. All controls should be on the right-hand side.
The headlamps must be adjusted according to Indian norms.
Apart from these, there will be a check for the emission of carbon and other pollutants from the imported vehicle. It must meet the stringent norms known as ‘Bharat Stages’.
Cars you cannot import to India
Banned automobiles cannot be imported into India. Importing a car must not have the following specifications:
Cars with 1,000cc to 2,500cc engines.
Heavy-duty two-wheelers or motorcycles with 50cc to 500cc engines.
Scooters with 250cc to 800cc engines.
Cars may only be imported through Mumbai, Chennai, and Kolkata naval ports. So just one of these ports should be used to import the automobile.
Procedure for Importing Used Cars to India
So, now that you know what cars are eligible for import to India, here are the procedures to follow to import used cars to India.
Duties and Taxes:
For used cars being imported to India, you will need to pay customs duty in foreign exchange.
Following this, there are other duties and taxes to be paid, such that it sometimes can be as high as 125% of the total vehicle cost. Customs brokers should be contacted for all the money matters.
Pre-Import Testing & Certification:
When the vehicle is imported from the USA, it should have a certificate that proper testing was conducted in the country before exporting to India. You can get it from any car dealer in the USA.
Shipping used car to India
The next step is to ship your car to India. You can contact any shipping agency like these for it.
Post Import Testing & Certification:
After the car is received by the port authority, it needs to be sent for testing before being allowed on Indian roads. This testing is done by the Vehicle Research and Development Establishment or Automotive Research Association of India in Pune. They will then issue a no-objection certificate.
Gateway of Import:
Vehicles can only be imported via the Mumbai, Chennai or Kolkatta naval port.
Post Import Servicing:
The Indian government also seeks the assurance of the vehicle manufacturer that its services will still be available for the vehicle post-import.
Importing cars when moving back to India
Foreign nationals or non-resident Indians (NRIs) may bring one car into India permanently. It might be a new or old automobile or motorcycle. Other requirements for importing a car/bike under “transfer of residence”:
The NRI should not have been in India for 2 years prior to the transfer.
The individual should intend to stay in India for a year following the move.
For at least three years prior to the present transfer, the individual should not have gone through “transfer of residence”.
Only one family member may do this. To do so, he must complete the Transfer of Residence Form.
Import the car/bike within six months after relocating to India.
The selling of an imported automobile is restricted for two years. So the individual should wait 2 years to sell the car.
No limit on new or used if the vehicle’s engine capacity is 75cc to 500cc.
Any vehicle above 1600cc in capacity must be registered for a year prior to import.
Documents needed to import used cars to India
The following paperwork will be required for importing a vehicle to India.
Invoice of the vehicle
Bill of Lading or Sea Waybill
Purchase Order/Letter of Credit
DEEC (Duty Exemption Entitlement Certificate) / DEPB (Duty Entitlement Pass Book) / ECGC (Export Credit Guarantee Corporation of India) or other documents as required.
Cost of importing used cars to India
It will cost you 125 – 300% in customs duties, taxes, etc when you import a car to India.
As far as imported cars are concerned, zipping by in a Humvee or Chrysler or even a Lincoln can be thrilling. It definitely is an unparalleled status symbol. However, the process could take time.
So, make sure you get as much information about the process as before spending any money on the vehicle.
Frequently Asked Questions (FAQs)
1. Can I import a used car into India?
Yes, you can import a used car into India. However, the Indian government has placed some restrictions and conditions on importing used cars to regulate the practice and safeguard the domestic automobile industry.
2. What is the age limit for used cars that can be imported into India?
As per the current regulations by the Directorate General of Foreign Trade (DGFT), used cars that are more than three years old from the date of manufacture cannot be imported into India.
3. Are there any specific rules for NRIs or PIOs for importing used cars?
Yes, NRIs or PIOs moving back to India on a permanent basis can import used cars under the Transfer of Residence (ToR) rules. They must have owned and used the car for at least 1 year abroad before importing it into India.
4. What types of cars can be imported into India?
Both right-hand drive and left-hand drive cars can be imported into India, provided they conform to the Indian regulations and standards.
5. What is the customs duty on importing a used car into India?
The customs duty on importing a used car into India can vary between 100-125% depending on the value of the car and other factors. This includes Basic Customs Duty, Social Welfare Surcharge, and Goods and Services Tax (GST).
6. How is the value of a used car determined for customs duty?
The customs department uses the Depreciation Scale to determine the value of the used car. The scale provides for a decrease in the value of the vehicle with each passing month since the date of registration or manufacture.
7. Are there any specific emission norms for used cars being imported?
Yes, the imported used cars must comply with the Bharat Stage emission norms, which are similar to the Euro emission norms.
8. Is it necessary to get the car homologated?
Yes, homologation is necessary when importing a used car into India. It refers to the approval process through which vehicles and their components must go to certify that they meet the regulatory standards and specifications.
9. Can I import a used car from any country?
10. Is there any limit on the number of cars that can be imported by an individual?
Yes, according to the current regulations, an individual can import only one vehicle in their lifetime.
Please remember that these regulations can change, so always check the most current guidelines on the Directorate General of Foreign Trade (DGFT) and Indian Customs websites.