Metal scrap import in India - Overview

The import of metal scrap plays a significant role in India's industrial and economic landscape. Before knowing the process to obtain the required permission for the import of metal scrap in India, it is important to comprehend its significance. Here are some key points focusing the importance of metal scrap imports in India.

Importance of metal scrap imports in India

Raw Material for Industry:

Metal scrap serves as a crucial raw material for various industries, including steel, aluminium, and copper. Importing metal scrap helps meet the demand for these essential materials in the manufacturing sector.

Cost-Efficiency:

Using recycled metal scrap is often more cost-effective than producing metals from virgin ores. Importing scrap helps industries access cost-efficient inputs, contributing to the overall competitiveness of Indian manufacturing.

Energy Conservation:

Recycling metal scrap requires less energy compared to extracting and refining metals from raw ores. Importing scrap supports sustainable practices by reducing the overall energy consumption in metal production processes.

Environmental Benefits:

Recycling metal scrap helps minimise environmental impact by reducing the need for extensive mining and extraction activities. It helps conserve natural resources, decrease pollution, and lower greenhouse gas emissions associated with traditional metal production.

Job Creation:

The metal recycling industry, including the collection, processing, and trading of scrap, creates employment opportunities. Importing metal scrap contributes to job creation along the entire supply chain, from collection and transportation to processing and manufacturing.

Circular Economy Promotion:

Importing metal scrap aligns with the principles of a circular economy, where resources are recycled, reused and repurposed. This approach helps in minimising waste, promoting sustainability, and developing a more efficient and environmentally friendly industrial ecosystem.

Infrastructure Development:

The import and processing of metal scraps require infrastructure such as recycling plants, transportation networks, and storage facilities. This contributes to the development of essential industrial infrastructure in the country.

Foreign Trade and Economic Growth:

Metal scrap imports contribute to international trade and economic growth. It provides opportunities for businesses to engage in global markets, fosters economic ties with other countries, and supports the diversification of the Indian economy.

Reduced Dependence on Primary Resources:

Importing metal scrap reduces India's dependence on primary metal resources, which are finite and often subject to geopolitical uncertainties. Diversifying sources through scrap imports enhances the resilience of the industrial sector.

Meeting Growing Demand:

As India undergoes rapid urbanisation and industrialisation, the demand for metals is expected to grow. Importing metal scrap helps bridge the gap between demand and domestic supply, ensuring a stable and consistent supply of essential materials. In conclusion, the import of metal scrap plays a crucial role in supporting India's industrial development, fostering sustainability, and contributing to economic and environmental objectives.

The process to import metal scrap in India

Importing metal scrap into India involves a series of steps and adherence to certain regulations. Here's a general guide on how to import metal scrap into India:

Register Your Business:

Ensure the business is registered with the appropriate authorities in India. This may include obtaining a Goods and Services Tax (GST) registration and an Importer Exporter Code or IEC from the Directorate General of Foreign Trade or DGFT.

Understand Import Regulations:

Familiarise with the import regulations and policies related to metal scrap in India. Stay updated on the latest guidelines issued by the Customs Department, DGFT, and other relevant authorities.

Classify the Product:

Accurately classify the metal scrap intended to be imported based on the Harmonised System of Nomenclature (HSN) or Customs Tariff codes. This classification is essential for determining the applicable duties and taxes.

Check Import Restrictions:

Verify if there are any restrictions or prohibitions on the import of specific types of metal scrap. Some materials may require special permits or compliance with environmental and safety standards.

Quality Standards and Inspection:

Ensure that the imported metal scrap meets the quality standards framed by the Bureau of Indian Standards or BIS or other relevant authorities. Pre-shipment inspection may be required, and certification from recognised agencies may be necessary.

Engage a Customs Clearing Agent:

Hire a licensed customs clearing agent to assist with the clearance of the metal scrap shipment through Indian customs. The agent will help with documentation, filings, and compliance with customs procedures.

Documentation:

Prepare the necessary documentation, including:

• Commercial invoice
• Bill of Lading or Airway Bill
• Packing list
• Importer Exporter Code (IEC)
• Certificate of Origin
• Pre-shipment inspection certificate (if required)
• Any other documents specified by customs or regulatory authorities.

Customs Declaration:

Submit a customs declaration for your imported metal scrap. This involves providing information about the nature of the goods, quantity, value, and other relevant details.

Payment of Duties and Taxes:

Pay the applicable import duties, taxes, and any other fees as determined by customs authorities. Ensure awareness of the duty rates for the specific type of metal scrap that is being imported.

Clearance and Delivery:

Once customs clearance is obtained, the metal scrap shipment can be released for delivery. Work with the logistics provider to ensure the smooth transportation of the goods from the port of entry to the desired destination.

Compliance with Environmental Regulations:

Be aware of and comply with any environmental regulations related to the import of metal scrap. This may include adherence to pollution control norms and waste disposal guidelines.

Build Relationships with Suppliers:

Establish relationships with reliable international suppliers of metal scrap. This includes negotiating terms, quality standards, and shipping arrangements.

It's crucial to consult with professionals, such as customs brokers and legal advisors, to ensure compliance with all applicable regulations and to navigate the complexities of the import process effectively. Additionally, staying abreast about changes in regulations and maintaining good communication with relevant authorities will contribute to a smoother import process.

Permissions required for metal scrap import in India

Importing metal scrap into India involves obtaining various permissions and adhering to regulatory requirements. Here are the key permissions and licenses one typically needs:

Importer Exporter Code (IEC):

An IEC is mandatory for any person or entity engaged in the import/export of goods and services in India. One needs to obtain an IEC from the Directorate General of Foreign Trade (DGFT) before starting the metal scrap import.

Goods and Services Tax (GST) Registration:

Register for GST with the Goods and Services Tax Network (GSTN). This registration is essential for paying and collecting GST on imported goods, including metal scrap.

Registration with Customs:

Register with the Customs Department, which involves submitting the required documents and obtaining a unique importer identification number.

Environmental Clearance:

Depending on the type of metal scrap and its environmental impact, one may need environmental clearances from the Ministry of Environment, Forest & Climate Change or MoEF&CC or the State Pollution Control Board (SPCB). Ensure compliance with environmental regulations and waste disposal guidelines.

Bureau of Indian Standards (BIS) Certification:

Some categories of metal scrap may require BIS certification to ensure that the imported goods meet Indian quality standards.

Pre-Shipment Inspection:

Certain categories of metal scrap may require pre-shipment inspection by authorised agencies. The inspection certificate may need to be submitted to customs authorities.

Customs Documentation:

Prepare and submit the necessary customs documentation, including the commercial invoice, packing list, bill of lading, certificate of origin, and any other documents specified by customs authorities.

Compliance with Import Restrictions:

Check for any specific restrictions or prohibitions on the import of certain types of metal scrap. Some materials may require special permits, and compliance with safety and health standards is crucial.

Customs Duty Payment:

Pay the applicable customs duties and taxes as determined by the Customs Department. The duty rates vary based on the type of metal scrap being imported.

Import License:

Some specific categories of metal scrap may require an import license. Check with the specific authorities to determine if the import falls into a category that requires a specific license.

Registration with Metals Recycling Association of India (MRAI):

While not a legal requirement, registering with industry associations like MRAI can provide additional credibility and networking opportunities in the metal recycling sector.

It's crucial to consult with industry experts and environment consultants like EcoserveIndia to ensure one is fully compliant with all regulatory requirements. Keep in mind that regulations may change, so staying informed and up-to-date is essential for a smooth import process.

Importing metal scrap into India involves various documentation to comply with customs and regulatory requirements. Here is a list of essential documents needed for the import of metal scrap:

Importer Exporter Code (IEC):

A valid IEC issued by the Directorate General of Foreign Trade (DGFT) is a primary requirement for any entity involved in import/export activities.

Goods and Services Tax (GST) Registration Certificate:

A copy of the GST registration certificate is required for the payment and collection of GST on imported goods.

Customs Declaration Form:

A completed customs declaration form with details about the nature of the goods, quantity, value, and other relevant information.

Commercial Invoice:

A detailed commercial invoice specifying the description of the metal scrap, quantity, unit price, total value, and terms of trade.

Packing List:

A packing list detailing the contents of each package, including the type and quantity of metal scrap in each shipment.

Bill of Lading or Airway Bill:

The Bill of Lading for sea shipments or the Airway Bill for air shipments serves as a receipt and contract of carriage. It includes details about the shipment, such as the consignee, shipper, and description of the goods.

Certificate of Origin:

A certificate indicating the country of origin of the metal scrap. This document is crucial for determining eligibility for preferential trade agreements and assessing applicable tariffs.

Pre-Shipment Inspection Certificate:

If required, a certificate from an authorised pre-shipment inspection agency confirming that the quality and quantity of the metal scrap meet the specified standards.

Insurance Certificate:

An insurance certificate covering the shipment's value, providing details about the insurance coverage and the insured parties.

Letter of Credit or Advance Payment Receipt:

If applicable, documents related to the letter of credit or proof of advance payment made for the metal scrap.

Import License (if required):

Some categories of metal scrap may require a specific import license. Check with authorities to determine if your import falls into such a category.

Bureau of Indian Standards (BIS) Certification (if required):

Certain types of metal scrap may require BIS certification to ensure compliance with Indian quality standards.

Environmental Clearance Certificate (if required):

Depending on the environmental impact, some metal scrap may require clearance from the Ministry of Environment, Forest and Climate Change (MoEF&CC) or the State Pollution Control Board (SPCB).

Any Other Specific Documentation:

Depending on the nature of the metal scrap and any specific regulations, additional documentation may be required. It's essential to stay informed about any particular requirements for the type of metal scrap being imported.

Always check with customs authorities and other relevant agencies to ensure the most up-to-date and accurate information regarding required documentation for importing metal scrap into India. Working with experienced professionals like EcoserveIndia can also help navigate the documentation process effectively.