IEC guide: how to get an Import Export Code and make your first export

An Import Export Code (IEC) is a ten-digit business identifier issued by the Directorate General of Foreign Trade (DGFT). You need it before customs will clear any goods you import or export, and before your bank can settle export proceeds. It costs ₹500, is issued online against your PAN in a day or two, and is valid for life as long as you confirm your details on the DGFT portal every year between April and June.

What an IEC is and why customs will not talk to you without it

The IEC is issued under Section 7 of the Foreign Trade (Development and Regulation) Act, 1992 and Para 2.05 of the Foreign Trade Policy. Since 2017 the code is your PAN itself, so a proprietor's IEC looks like their personal PAN and a company's IEC looks like the company PAN. Every shipping bill, bill of entry, bank remittance form and export incentive claim carries this number, and it is the key that connects DGFT, customs (ICEGATE), your bank and the RBI's export data.

Think of it as the trade equivalent of a GSTIN. Without it, a courier company will not book a commercial shipment for you, a customs house agent (CHA) cannot file your shipping bill, and your bank will treat your first dollar receipt as an unexplained inward remittance.

Who needs an IEC and who does not

Anyone importing or exporting goods for business needs one, regardless of size: a Kochi electronics shop importing a pallet of accessories from Shenzhen, a Surat textile trader sending saree fabric to Dubai, or a marketplace seller sending ten parcels a week abroad. The requirement is tied to the activity, not to turnover.

Three groups are exempt under the Foreign Trade Policy:

• Individuals importing or exporting goods for personal use that have nothing to do with trade, manufacturing or agriculture.
• Ministries and departments of the central and state governments.
• Some low-value trade with Nepal, Bhutan and Myanmar through notified land routes, subject to limits set in the policy.

Service exporters are the grey area. If you are a Pune freelance designer billing a client in Toronto, you do not need an IEC to receive the money or to treat the supply as a zero-rated export under GST. You need it only if you want to claim a Foreign Trade Policy benefit such as a duty credit scrip. In practice many banks ask for an IEC when they raise an inward remittance certificate, so most service businesses take one anyway.

Documents to keep ready before you open the DGFT portal

The application is short but rejections come from mismatched details, so gather these first:

Along with these you need a mobile number and email for OTPs, and either the Aadhaar of the authorised person for e-sign or a Class 3 digital signature certificate. The cancelled cheque must show the account holder's name printed; if it does not, ask the bank for a one-page bank certificate instead. The address on the proof must match the address you type, down to the pin code.

If you have not opened a current account yet, do that first; our current account opening guide covers the documents by entity type. The AD code you will need later is tied to that account.

Applying on the DGFT portal, step by step

1. Go to dgft.gov.in and register as an importer/exporter using your PAN, mobile and email. The portal checks the PAN name against the Income Tax database, so use the name exactly as it appears on the PAN card.
2. Log in, choose "Apply for IEC", and fill Form ANF-2A: entity details, branch addresses, directors or partners, and bank account.
3. Upload the address proof and cancelled cheque as PDFs under the size limit shown on the page.
4. Sign with Aadhaar e-sign or DSC and pay the ₹500 fee online.
5. The IEC certificate is generated by the system, usually the same day. Download it; you will be asked for a copy by your bank, your CHA and later by the export promotion council.

There are no physical documents and no visit to the regional authority. If the system flags a mismatch, the reason is displayed against the application; fix the document and resubmit rather than filing afresh.

The annual update between April and June

This is the rule that trips up more first-time exporters than anything else. DGFT Notification 58/2015-20 of February 2021 made it mandatory for every IEC holder to update or confirm their IEC details electronically every year between April and June, even when nothing has changed. If you do not, the code is deactivated on 1 July and customs will reject your shipping bills and bills of entry until you log in and complete the update.

The update takes five minutes: log in, open the IEC profile, verify each section, and submit with Aadhaar OTP or DSC. There is no fee. Put a reminder in your calendar for the first week of April alongside the LUT renewal. If your bank, address, partners or directors change mid-year, file a modification straight away rather than waiting for the window.

Linking the IEC with GST, ICEGATE and your bank's AD code

Getting the IEC is one of four registrations that must line up before your first shipment can move:

GSTIN. Exports are zero-rated supplies under Section 16 of the IGST Act, 2017. You need GST registration to file a LUT and to claim a refund of input tax credit, and your GSTIN is printed on the shipping bill. If you are not yet registered, read our GST registration guide; an exporter registers regardless of turnover in practice because the refund mechanism needs it.

ICEGATE. This is the customs portal where shipping bills and bills of entry are filed. Register with your IEC and a DSC or Aadhaar-linked login even if a CHA will file on your behalf, because your RoDTEP scrips and IGST refunds appear in your ICEGATE ledger.

AD code. Your bank issues a 14-digit Authorised Dealer code on its letterhead for the current account that will receive export proceeds. You then register that AD code on ICEGATE against each port or airport you ship from, once per port. Without an AD code registered at that port the shipping bill cannot be generated, and without the linked bank account customs has nowhere to send drawback or RoDTEP credits.

RCMC. A Registration-cum-Membership Certificate from your export promotion council (EPCH for handicrafts, AEPC for apparel, FIEO for general traders) is needed for many Foreign Trade Policy benefits, though not merely to ship goods.

GST and incentives: LUT, RoDTEP and drawback

LUT: exporting without paying IGST

GST gives an exporter two ways to zero-rate a supply. The first is to pay IGST on the export invoice through your GSTR-3B and claim a refund through the shipping bill under Rule 96 of the CGST Rules. The second is to file a Letter of Undertaking in Form GST RFD-11 under Rule 96A, export without charging IGST, and claim a refund of the input tax credit accumulated on your purchases under Rule 89.

The LUT is filed online on the GST portal, takes minutes, needs no bank guarantee unless you have been prosecuted for tax evasion above ₹2.5 crore, and is valid for one financial year. File it in the first week of April every year; a shipment made before the new LUT is filed technically needs IGST charged.

Your export invoice must follow Rule 46 of the CGST Rules: it carries the words "Supply meant for export under Letter of Undertaking without payment of IGST" (or "on payment of IGST" if you chose that route), the buyer's name and address, the country of destination and the delivery address, and eight-digit HSN codes. Report it in Table 6A of GSTR-1 with the shipping bill number and date, because the customs system matches that table against the shipping bill before releasing any refund. Our post on GSTR-1 and GSTR-3B filing explains where the export table sits.

RoDTEP, drawback and realisation of proceeds

RoDTEP (Remission of Duties and Taxes on Exported Products) refunds embedded central, state and local taxes that are not otherwise credited, such as fuel tax on transport and electricity duty. Rates are a small percentage of the FOB value, product-wise, listed in Appendix 4R of the Foreign Trade Policy; most items fall between 0.3% and 4.3%. You claim it by ticking the RoDTEP declaration in the shipping bill, and the credit appears as an e-scrip in your ICEGATE ledger. The scrip can be used to pay basic customs duty on imports or transferred to another importer. The scheme has been extended in phases, so check whether your HSN is currently covered before you build it into your price.

Duty drawback under the Customs Act refunds customs duty paid on inputs at an all-industry rate, also claimed through the shipping bill. Export proceeds must generally be realised within nine months under FEMA rules; your bank reports each receipt so that you can generate an e-BRC (electronic bank realisation certificate) on the DGFT portal. Keep it; refunds and scrips can be recovered if proceeds are never realised.

Your first export: the paperwork in order

For a typical sea or air shipment the documents move in this sequence:

1. Proforma invoice to the buyer with price terms (FOB, CIF, EXW), payment terms and delivery time. The buyer's acceptance or purchase order fixes the deal.
2. Commercial invoice once goods are ready: your IEC, GSTIN, LUT reference, buyer details, eight-digit HSN, quantity, unit price, currency, Incoterm and total.
3. Packing list with carton-wise contents, net and gross weights, and dimensions. Customs, the forwarder and the buyer's clearing agent all work from this.
4. Shipping bill filed on ICEGATE by you or your CHA, quoting the invoice, packing list, AD code and RoDTEP declaration. Once customs gives "Let Export Order", the shipping bill is your proof of export.
5. Bill of lading (sea) or airway bill (air) from the carrier once the cargo is loaded.
6. Certificate of origin if the buyer's country grants a preferential duty rate, and an insurance certificate if you sold on CIF terms.

Worked example: a Jaipur handicrafts exporter's first shipment

Meera runs a small brass and wood decor business in Jaipur. A US home-store chain orders 400 brass lanterns at $20 each, FOB Mundra, payment 30 days from bill of lading. At an illustrative rate of ₹85 per dollar the order is worth ₹6,80,000.

Her costs for the order:

GST paid on materials and packing comes to ₹41,000 (a mix of 5% and 18% items; confirm the rate for each HSN). Meera filed her LUT in April, so her commercial invoice shows ₹6,80,000 with no IGST. Her gross margin is ₹6,80,000 less ₹4,63,500, which is ₹2,16,500, or 31.8% of the invoice value. She files a refund claim under Rule 89 for the ₹41,000 of accumulated ITC after her GSTR-3B for the month is filed, and she ticks the RoDTEP box on the shipping bill; at an illustrative 1% rate that is ₹6,800 of e-scrip.

Had she skipped the LUT and exported on payment of IGST at 5%, the invoice would have shown IGST of ₹34,000, paid through her ITC and refunded via the shipping bill weeks later, with the remaining ₹7,000 of credit needing a separate RFD-01 claim. Same money, two refund tracks, longer wait.

Common mistakes

• Applying with a savings account. DGFT accepts it, but banks will not give an AD code for a savings account, and export proceeds into a personal account create FEMA and income tax questions later.
• Forgetting the April to June update. The IEC silently deactivates on 1 July and the first you hear of it is a rejected shipping bill.
• Exporting in April before the new LUT is filed. The old LUT expired on 31 March; file the new one before the first shipment of the year.
• Wrong Incoterm on the invoice. Quoting CIF but paying only for FOB, or the reverse, is the fastest way to lose the margin on a first order.
• Not registering the AD code at the new port. The registration is port-specific; shipping from Delhi air cargo after exporting from Mundra needs a fresh registration.
• Ignoring GSTR-1 Table 6A. If the export invoice is reported as a normal sale, the customs system cannot match it and the IGST refund or ITC refund stalls.
• Letting proceeds sit abroad. Money must be realised within nine months; if a buyer pays late, tell your bank and get the extension noted.

How VyaparKit helps

VyaparKit's commercial invoice template carries the fields customs and buyers expect, including IEC, Incoterm, currency and the LUT declaration line, and the packing list tool produces carton-wise weights and dimensions from the same item list. Use the HSN and SAC lookup to find the eight-digit code before you commit it to an invoice. For domestic sales that run alongside your exports, the GST invoice tool splits CGST, SGST and IGST by place of supply and feeds your GST report. VyaparKit does not file shipping bills, LUTs or GST returns; those stay with ICEGATE, the GST portal and your CA.

Next steps

• Open a current account, then apply for the IEC on dgft.gov.in with PAN, cancelled cheque and address proof.
• Register on ICEGATE, get the AD code letter from your bank and register it at your first port of export.
• File the LUT in Form GST RFD-11 for the current financial year and set an April reminder for both the LUT and the IEC update.
• Take RCMC from your export promotion council if you plan to claim RoDTEP or other policy benefits.
• Prepare the proforma invoice, commercial invoice and packing list templates before the first order lands, so documentation never delays the shipment.