Africa and India share distinguished trade relations which go back thousands of years. A large number of Indian labor moved to East Africa to work in the railway sector during the colonial period. The Indian diaspora that you see in the African continent today consists of many descendants. As the diaspora increased, Indians became critical links in African exports of oil, coffee and other commodities and Indian imports into their new found homeland such as electronic equipment and precious metals.
A report from last year cited the (International Monetary Fund) IMF’s calculation of the value of India’s exports to Africa. It informed that exports consisting of high-end consumer goods increased by over 100% from 2008 onwards, implying that import of Indian goods in Africa surpassed the import of US goods to the region. Imports of telecom equipment, pharmaceuticals, automobiles and consumer electronics have been on the rise since 2010.
How to Prepare Your Business for Imports
If you want to import products from India, there are several issues you have to sort out in order to be successful. The following is a brief overview of the usual considerations:
Financial issues often arise when businesses import or export goods and services to emerging nations. Importers in countries like China and India usually have limited payment options available, unlike importers from the US. That’s why you need to know about all available options to send money to India. The good news is that Ria and other similar services have made it easy to send money online anytime to any banking institution in India. Transactions can be funded through a debit card, credit card or bank account and the money arrives securely to anyone anywhere. Payout locations ensure the importer can receive the payment in cash if they can’t make a trip to the bank.
Import Duty & Taxes
You need to have accurate information about import duty on different items and the taxes you need to pay as this will help you determine the retail price you’re going to charge for imported items. Also, depending on the extra cost, you can bargain the purchase price with the suppliers in India. Due to the intense competition in the export sector, Indian businesses are often flexible when it comes to price quotes and production. Resources such as Dutycalculator.com can help you get an estimate of goods before they’re imported into Africa.
The last important consideration pertains to import permits. If you’re importing used or second-hand items from India to countries like South Africa, you’ll need to register your business as an importer with the country’s revenue service agency and then apply to the Itac (International Trade Administration Commission). Exporters from India will ask you to present this permit before they send any goods to the country of your business residence. The permit dictates that you intend to import items that abide by the quality, safety, health and environmental requirements of the country. Permits also ensure that your business is complying with the provisions laid down in international agreements.
You can significantly reduce the hassles involved in importing goods from India by making these three considerations. The Indian Prime Minister’s visit to Africa indicates that there is significant opportunity in the import-export business, so consider these tips when jumping the bandwagon to increase your chances of success.