In the context of India’s Foreign Trade regime, the primary determination before importing or exporting a product is to determine the policy whether it is classified as free, restricted, canalised or prohibited under the ITC HS and the Foreign Trade Policy.
What does “restricted” mean in Indian import and export law
DGFT divides goods into four policy buckets: free, restricted, prohibited and State Trade Enterprises. Goods not specifically put in one of these buckets are treated as “free”.
Broadly:
No DGFT licence required. Standard Customs compliance still applies.
Import or export is allowed only with a specific Authorisation or Permission from DGFT and a NOC from the concerned Ministry.
Import or export of these specific goods are not allowed at all.
- State Trading Enterprises
Trade is allowed only through designated State Trading Enterprises or specific government channels.
Legal framework behind restricted items
The main pillars behind restricted goods are:
- Foreign Trade (Development and Regulation) Act, 1992 (FTDR Act)
Section 3 empowers the government to prohibit, restrict or otherwise regulate import and export of goods and services.
- Foreign Trade Policy 2023 (FTP 2023)
FTP 2023 states that any goods or services that are “restricted” can be imported or exported only in line with an Authorisation or Permission from DGFT. Exim Facilitation Committee (EFC) gives the permission for the import of these restricted items.
- ITC HS Schedules
- Schedule 1 – Import Policy
- Schedule 2 – Export Policy
Each 8 digit HS code carries a policy tag such as Free, Restricted, Prohibited or STE (State Trading Enterprise).
Section 11 empowers the government to prohibit or restrict imports and exports. Section 111 and related provisions allow confiscation and penalties if restricted items are imported without proper licence.
Many restricted items are controlled not only by DGFT but also by line ministries and regulators such as:
- BIS (Bureau of Indian Standards)
- CDSCO (Central Drugs Standard Control Organisation)
- FSSAI (Food Safety and Standards Authority of India)
- Wildlife authorities
- Atomic Energy Regulatory Board
- Environment and Hazardous Waste regulators
Typical categories of restricted import items in India
The DGFT maintains a list of restricted import items within ITC HS, updated from time to time. The list is detailed and HS code specific, but common categories include:
- Live animals and livestock products
- Seeds, plants and agricultural inputs
- Hazardous chemicals, wastes and ozone-depleting substances (HFCs, HFOs, HCFCs)
- Used and second-hand goods
- Many categories of second-hand capital goods, machinery and refurbished items have conditions such as residual life, pre-shipment inspection and specific import authorisation in some cases.
- Laptops and Servers
This is not an exhaustive list. The actual legal status always sits against the 8 digit HS code in the ITC HS schedule, plus any specific DGFT notification.
Typical categories of restricted export items in India
Exports also face similar policy buckets. FTP 2023 and the ITC HS export schedule classify certain goods as restricted for export, requiring a DGFT Export Authorisation.
Typical categories include:
- Agricultural and food items in sensitive periods
- Petroleum products, minerals and ores
- Wildlife products and items from endangered species
- Ozone-depleting substances (HFCs, HFOs, HCFCs)
How Osgan supports clients on restricted import and export items
At Osgan Consultants, restricted items and licensing are part of our daily working reality. Our support typically covers:
- Product and HS classification for Indian ITC HS at 8 digit level
- Policy mapping to identify whether an item is Free, Restricted, Prohibited or Canalised for both import and export
- End-to-end DGFT authorisation support
- Allied law mapping
- Linking your HS codes to BIS, CDSCO, FSSAI, Plant and Animal Quarantine, Environmental and Wildlife approvals where required.
