How to Start an Export Business in India: IEC, RCMC and First Shipment

To start exporting from India you need three things in place before your first carton leaves the factory: an Importer-Exporter Code (IEC) from the DGFT, a clear payment and shipping plan your bank can process, and the right set of export documents. This guide walks through IEC registration step by step, explains when you also need an RCMC, lists the documents a first shipment actually needs, and ends with a worked example of a small exporter’s first order.

What you need before you apply for anything

Sort out this basic paperwork first:

• A business entity. A proprietorship is fine for a first export. Partnerships, LLPs and companies work the same way; the IEC is issued against the entity’s PAN.
• PAN in the name of the business (or the proprietor’s PAN for a proprietorship) and an Aadhaar that matches the PAN details.
• A current account in the business name with a bank that handles foreign exchange. Ask the branch upfront whether they process export bills and inward remittances, because some small branches route everything to a regional trade finance centre, which adds days.
• A valid business address with proof (rent agreement, electricity bill or property document).
• GST registration if you export goods. Exports are zero-rated, which means you can ship without paying IGST by filing a Letter of Undertaking (LUT) on the GST portal, or pay IGST and claim it back as a refund. Most small exporters choose the LUT route because it keeps cash free.
• A Class 3 digital signature (DSC) or Aadhaar e-sign for signing applications on the DGFT portal.

DGFT’s own IEC FAQ lists the technical requirements as a valid digital signature token, PAN, mobile number and email, branch address details, a bank account in the name of the IEC holder, and an Aadhaar card matching the PAN details.

Step 1: Register for your IEC on the DGFT portal

The Importer-Exporter Code is a 10-character business identification number. Customs, your bank and the DGFT all use it to identify you as an exporter, and you cannot file a shipping bill for commercial goods without it.

How the application works

1. Go to the DGFT website and register as an “Importer/Exporter”. You verify your mobile number and email with OTPs and receive a temporary password by email.
2. Log in, change the password, and from the dashboard choose Importer Exporter Code (IEC) > Apply for IEC.
3. Fill in entity details, address, bank account, and details of partners or directors where applicable. For companies, director details are pulled from MCA records using the CIN.
4. Upload the supporting documents the system asks for. Since a November 2025 amendment to the Handbook of Procedures, details are validated online against other government and bank records wherever possible, so you may be asked for fewer scans than older guides suggest.
5. Sign with DSC or Aadhaar e-sign and pay the Rs 500 fee online.

According to the DGFT IEC Profile Management FAQ, the average time to receive the IEC is immediate after successful submission, and it reflects on ICEGATE (the customs portal) in real time. Bank details are validated through PFMS the next day. If that validation fails, a risk flag stays on your IEC until the regional authority checks the bank document you uploaded, so make sure the account name exactly matches your firm name, including spaces.

The annual update most people forget

The IEC itself has permanent validity, but every IEC holder has to update or confirm the details online each year. The Indian Trade Portal’s IEC page states that updating between April and June carries no fee, and an IEC not updated in time is deactivated. It can be reactivated once you complete the update, but a deactivated IEC in the middle of a shipment is a headache you do not need. Put a recurring reminder for 1 April in your calendar the day you get the code.

Do service exporters need an IEC?

Usually not. Freelancers, software firms and consultants who export services generally do not need an IEC unless they want to claim benefits under the Foreign Trade Policy. If you only export services, check with your CA before applying, because the GST and FEMA paperwork (invoices, FIRC/inward remittance advice, LUT) matters more for you than the IEC.

Step 2: Decide whether you need an RCMC now or later

The Registration-cum-Membership Certificate (RCMC) is issued by the Export Promotion Council (EPC) or commodity board that covers your product. It is not required to physically ship goods, but it is required to claim most benefits under the Foreign Trade Policy, and many trade fair subsidies and buyer-seller meets run by councils are open only to members.

The DGFT e-RCMC service lets you apply online once you have an active IEC and an updated IEC profile. The certificate is valid for five financial years, counted from 1 April of the year of issue. Membership fees are set by each council and differ quite a bit, so compare before you pay.

If you export…	Typical council or board (examples)	When to get RCMC
Engineering goods, auto parts, tools	EEPC India	Before you claim benefits or book a council stall at a fair
Readymade garments	Apparel Export Promotion Council	Early, because buyers often meet exporters at council events
Spices	Spices Board	Before first shipment, because spice exports need registration with the Board
Processed foods, fresh produce	APEDA	Before first shipment for scheduled products
Handicrafts	Export Promotion Council for Handicrafts	Within the first few shipments
Mixed products, or your main line is not settled	FIEO	When you want benefits but no single council fits

Confirm your product’s council on the DGFT portal before applying.

Step 3: Pick your product, market and Incoterm

One product, one market

Pick one product you can supply consistently at a stable quality, and one or two markets where you have a reason to expect demand: a diaspora community, an existing contact, a tariff advantage, or real buyer enquiries.

Before you quote anyone, check three things:

• Import duty and rules in the destination country for your product’s HS code. The Indian Trade Portal has tariff and regulatory information for many markets.
• Product rules such as labelling language, food safety registration (for example, US FDA facility registration for food), REACH for chemicals in the EU, or children’s product safety standards.
• Your own HS code. Getting the classification right decides duty, incentive rates and whether a product is restricted. A good customs broker will help, but you should understand the logic yourself.

Price with the right Incoterm

An Incoterm decides who pays for and carries the risk on each leg of the journey. Misunderstanding it is the most common way a first export order loses money. Agree it in writing on your proforma invoice.

Incoterm	You (the exporter) pay up to…	Good for first-time exporters?
EXW (Ex Works)	Goods ready at your premises; buyer handles everything else	Risky in practice, because you still need to complete Indian export clearance properly
FCA (Free Carrier)	Delivery to the buyer’s nominated carrier, export cleared	Yes, simple and clear
FOB (Free On Board)	Goods loaded on the vessel at the Indian port (sea freight only)	Yes, the most familiar term for sea shipments
CIF (Cost, Insurance and Freight)	Freight and minimum insurance to the destination port	Only once you have a reliable freight forwarder quote
DAP / DDP	Delivery at the buyer’s place; DDP also includes import duties	Avoid at first unless you know the destination’s import process

Build your price from the bottom up: product cost, export packing, inland transport, customs broker and terminal charges, then freight and insurance if your Incoterm includes them. Add a buffer for currency movement on longer quotes.

Step 4: Choose payment terms you can live with

Your first buyer is a stranger. Payment terms should protect you until trust is built.

Payment term	Risk to you	Notes
100% advance	Lowest	Common for small first orders and samples
Part advance, balance against documents	Low to medium	For example 30% advance, 70% against scan of bill of lading
Letter of Credit (LC)	Low if documents are perfect	Banks pay only if documents match the LC exactly; small mismatches cause delays
Documents against Payment (D/P)	Medium	Buyer pays to collect documents, but may refuse to pay at all
Open account / credit	Highest	Only for established buyers, ideally with export credit insurance from ECGC

There is also a legal clock. Under FEMA, the value of exports must be realised and repatriated within a set period. RBI extended that period from 9 to 15 months in November 2025, then restored it to 9 months with effect from 5 June 2026, as reported by Taxmann. These limits have changed twice in a year, so confirm the current rule with your AD bank before you offer long credit.

Step 5: The documents your first shipment needs

Exact requirements depend on product and destination, but most small shipments involve the following.

Document	Who prepares it	Purpose
Proforma invoice	You	The offer: price, Incoterm, payment terms, delivery date. Buyer confirms it.
Commercial invoice	You	Final invoice for customs and payment. Must include IEC, GSTIN and LUT reference if applicable.
Packing list	You	Box-wise contents, weights and dimensions
Shipping bill	Customs broker on ICEGATE	The export declaration to Indian customs
Bill of lading or airway bill	Shipping line, airline or forwarder	Proof of shipment and, for sea, document of title
Certificate of origin	Authorised agency	Needed when the buyer wants duty benefits under a trade agreement
Insurance certificate	Insurer	When your Incoterm makes you responsible for insurance
Product certificates	Testing labs, boards	Phytosanitary, health, fumigation or quality certificates where required

Before your first shipment, your bank’s AD code must be registered with customs at the port or airport you will use. Your customs broker can guide you; it is a one-time step per port, and forgetting it is a classic reason for a shipping bill getting stuck.

Step 6: A worked example of a first export order

Here is how a first order might run for an illustrative business: a small block-print textile maker in Jaipur selling 300 cushion covers to a home-décor shop in the Netherlands.

1. Week 0. The buyer approves samples sent by courier. The maker sends a proforma invoice: FCA Jaipur airport, price in euros, 40% advance and 60% against the airway bill copy, delivery in four weeks.
2. Week 1. Advance arrives. The bank asks for the purpose code and invoice to credit it. The maker confirms the LUT for the financial year is active on the GST portal.
3. Weeks 1 to 3. Production, quality check and export packing, with carton marks matching the packing list.
4. Week 4. The customs broker files the shipping bill on ICEGATE, goods are examined if selected, and customs gives the Let Export Order. The airline issues the airway bill.
5. Week 4. The maker sends scanned documents to the buyer, receives the balance, and submits documents to the bank so the export is closed in the bank’s records well within the 9-month realisation window.

Get at least two customs broker quotes before the first shipment; charges vary.

Incentives, GST and common mistakes

Once you are shipping regularly, look at the main support available. RoDTEP (Remission of Duties and Taxes on Exported Products) refunds certain embedded taxes at notified rates per product, and duty drawback refunds customs duty on imported inputs. Rates and eligibility change by notification, so check the current schedules on the DGFT and CBIC websites rather than relying on an old blog post. Your shipping bill must carry the right claims at the time of filing; they are hard to add later.

On GST, exporting under LUT means no IGST on the export invoice, and you can claim refund of accumulated input tax credit. Keep invoices, shipping bills and bank records matched month by month.

When you land a notable first order or a new overseas distributor, a short public announcement can help with the next buyer’s trust check; our guides on writing a press release in India and distributing it to Indian media cover how to do that without overselling.

Mistakes first-time exporters make

• Quoting before checking freight. Freight can swing your margin more than your factory cost. Get a forwarder quote before you send a CIF or DAP price.
• Shipping on open credit to an unknown buyer. Start with advance or LC, even if it means a smaller order.
• Weak export packing. Domestic cartons do not survive multiple handlings and humid holds. Damaged first orders rarely become second orders.
• No document file per shipment. You will need every invoice, shipping bill and bank advice for GST refunds, incentives and audits.

Rules on foreign trade, GST and FEMA change through notifications. Use this guide as a map, and confirm current requirements on the DGFT portal and with your bank or a chartered accountant before acting.

Frequently Asked Questions

How much does an IEC cost and how long does it take?

The government fee is Rs 500, paid online. DGFT’s FAQ says the IEC is generally issued immediately after a successful application, and it appears on ICEGATE in real time. Agents may charge a service fee on top, but you can apply yourself.

Does the IEC need renewal?

No renewal, but an annual update or confirmation is mandatory. Doing it between April and June is free. If you miss it, the IEC is deactivated until you complete the update.

Can I start exporting without GST registration?

For goods, practically no. Customs and your bank expect a GSTIN, and you need it to file an LUT and claim refunds. Service exporters have different thresholds, so check with a CA.

Is RCMC compulsory?

Not for shipping itself, but it is needed for most Foreign Trade Policy benefits and is mandatory for certain products, such as those covered by some commodity boards. It is valid for five financial years.

How quickly must I receive payment from my buyer?

Currently within 9 months of export, after RBI restored that limit from June 2026. Agree much shorter terms with your buyer and follow up from day one.

Your first 30 days, in order

Week one: open the current account, confirm GST, and apply for the IEC. Week two: file the LUT, pick your product’s council and decide whether to take RCMC now. Week three: shortlist two customs brokers and one freight forwarder, and get sample quotes for your likely route. Week four: send samples and a clean proforma invoice to your first serious buyer. That is a realistic, unhurried path to a first shipment, and it leaves you with a setup you can repeat for every order after it.