Importing goods from China has become one of the most effective ways for Indian business owners to access affordable products, expand their inventory, and stay competitive in today’s global market. China offers a wide variety of goods across nearly every category, including electronics, apparel, machinery, homeware, and more.
However, alongside this opportunity lies a significant risk: scams. Every year, hundreds of Indian businesses fall prey to fraudulent suppliers, fake agents, and deceptive deals that can cost them lakhs of rupees or even their entire business.
At iLife Import, we’ve worked with businesses across India and helped them securely import goods from China to India by identifying and eliminating every potential risk.
In this guide, we will walk you through everything you need to know to avoid scams while importing goods from China to India. With a step-by-step instruction, based on our on-ground experience and in-depth knowledge of international trade, we can help you with that.
Why Are Import Scams So Prevalent When Dealing With China?
There’s no doubt that China is the world’s manufacturing powerhouse, but this also means that the supply chain is massive, decentralized, and difficult to regulate. While many wholesale suppliers in China are completely genuine and professional, the sheer volume of players in the market makes it easy for scammers to enter.
Some reasons why online scams are common include when importing products:
- Low entry barriers for suppliers: Almost anyone can register on global platforms like Alibaba or Made-in-China. So, a fraudster has an open gate to manipulate importers into representing false and tempting information to get more attention.
- Lack of regulatory oversight: While China has local regulatory bodies, enforcement is weak, especially for foreign buyers. To be familiar with the regional laws for importing goods, they have to hire a attorney and an expert person who specializes in international import/export.
- Language and cultural differences: Misunderstandings can be exploited by dishonest traders who are usually unfamiliar with the local language and cultural references. Usually, Indian importers can’t get the exact meaning that the Chinese sellers want to explain. So, sometimes the meaning has been changed, and the fraudulent agents confidently make this happen.
- Geographical distance: Indian buyers can’t visit the Chinese supplier’s facility to confirm legitimacy. So, fake suppliers are stealing the images from the web and representing that they own the products and factories with premium facilities. But in reality, they are not.
The most common types of scams include:
- Taking full advance payment and disappearing.
Most of the scams are associated with this type, where the sellers pretend to be authenticated and demand a 100% payment before goods are dispatched.
- Delivering substandard or completely different goods from the samples.
This is very common. Usually, most of the importers face this, especially when importing products from China. Some of the fraudulent agents use this technique to manipulate the buyers into selling the top-quality samples, but the second batch of the goods remains defective. Once the goods reach the importer's office, the contact of these sellers is not reachable, and it is a sign of an import scam.
- Charging hidden fees post-agreement.
The new scam emerged in importing the products when a supplier demands additional fees from the importers. Do you know the worst part of this? Trade agreements don’t have a clarification about these fees. So, as a buyer, you doubt the supplier’s credibility. If you do not pay the remaining amount, they will give you a warning to complain to the regional authority. Most of the new importers are ready to pay the amount.
- Using fake customs or shipping documents.
As internet usage grows rapidly and cheap software becomes increasingly available, fraud suppliers change the names and goods descriptions easily on bills and shipping documents. They sent a fake custom report to sellers and demanded a payment release. Once the payment has been done, the seller's profile is missing from the marketplace, and they can’t be searched for at all.
This is why due diligence is non-negotiable when importing from China.
Let’s explore the step-by-step guide to avoid the common and advanced scams while trading with the Chinese suppliers.
Step 1: Conduct In-Depth Supplier Verification.
The first step in avoiding a scam is verifying your supplier thoroughly. This step alone can eliminate 70% of fraudulent deals.
How to verify a Chinese supplier:
- Request and examine the business license: A genuine supplier will not hesitate to provide a copy of their Chinese business license. You can cross-verify this license on the official Chinese government registry website, National Enterprise Credit Information Publicity System (NCIS). Look for consistency in the company name, address, and nature of business.
- Check their presence on multiple platforms: A reliable supplier will usually be listed on multiple B2B sites like Alibaba, Global Sources, and Made-in-China. Compare their profile details, product listings, and reviews across platforms.
- Conduct factory audits or on-ground inspections: If possible, hire a third-party inspection company to visit the supplier’s location. These inspections verify if the factory exists, assess manufacturing capacity, and even review their certifications. Don’t rely on a sample, but check the reality first.
- Use social verification: Connect with the sales representative via LinkedIn. Genuine companies typically have a team with verified LinkedIn profiles. You can also ask for a video call tour of the facility. Avoid wholesale suppliers who do not come to talk face-to-face but are ready to trade. They’re scammers.
- Ask for trade references: Reliable suppliers will happily share contact details of past clients, ideally Indian companies who can validate their experience. So, if you need any verifications, freely ask about the concern before committing to the trade agreement.
In essence, scammers avoid transparency. If a supplier is hesitant to share details or insists on urgency without verification, treat it as a red flag.
Step 2: Avoid Full Advance Payments & Choose Safe Payment Methods
Many import scams occur because buyers send full payments in advance, hoping for quick delivery. This is the riskiest mistake a new importer can make.
Safer payment practices include:
- Trade Assurance (Alibaba): This system holds your payment in escrow and releases it only after you confirm receipt of satisfactory goods.
- Letter of Credit (LC): Used for large shipments, this protects both buyer and seller through bank-guaranteed payment upon fulfillment of terms.
- Telegraphic Transfer (T/T): Common for smaller orders, usually for importing goods from a shared container booking. The safest method is to pay 30% advance and 70% after receiving shipment confirmation and documents like the Bill of Lading.
- Escrow services: Funds are held by a trusted third party until you authorize the release post-inspection.
Avoid these risky methods:
- Western Union scams involve urgent situation where a fraud agents and suppliers demands an initial payment without sending the goods or handing over the shipping documents.
- Cryptocurrency payments like Bitcoin, Litecoin, and meme coins. These currencies only remain digital and don’t have centralized regulation on them as a FIAT currency does.
- Cash transfers are promoted by scammers, and they do not have a legitimate presence.
These are almost impossible to trace or recover if something goes wrong. So, keep this in mind.
Step 3: Never Skip the Sample Stage.
Before placing a large order, it’s important to test product quality with physical samples. Scammers usually send high-quality samples but deliver inferior bulk goods. Those goods are only counterfeit and low-quality products.
Here’s how to check whether the sample testing is effective:
- Order multiple samples: Don’t rely on just one product. Request two to three samples to check consistency. Try three different kinds of goods and determine the best one.
- Test quality personally: Examine materials, finishing, labeling, functionality, and compare it to industry benchmarks. If it looks more suspicious, then avoid trading.
- Cross-verify with local standards: If importing hardware or toys, ensure they comply with BIS or other regulatory requirements to safely clear customs in India.
- Use third-party lab testing (if needed): Especially for products with safety implications like food containers, health products, or children’s toys, the trusted source verification helps a lot.
This small investment can save you from major losses later.
Step 4: Create a Legal Purchase Contract.
Never rely on email discussions or verbal promises. A legally binding contract, clearly written in English and Chinese. It is your strongest defense against fraud.
What your purchase agreement should include:
- Product specifications (with tolerance levels)
- Quantity and packaging details
- Delivery timelines and shipping terms (like FOB, CIF, or DDP)
- Payment schedule and refund clauses
- Penalty clauses for delays or quality defects
- Dispute resolution method (ideally through arbitration in Hong Kong or Singapore)
You can hire a bilingual lawyer or use a consultant like iLife Import to create and review this contract. Chinese courts don’t honor informal or English-only documents.
Step 5: Be Alert to Unrealistic Offers.
Many Indian importers are tempted by low prices to get more product quantity. And scammers use this strategy to attract easy victims. Once the payment has been made, the sellers are not reachable, and it constitutes fraud in trade.
Red flags to watch for:
- Prices are significantly lower than the market average. Please verify the pricing around the marketplaces and ask quotation from 5-6 product suppliers.
- Promises of branded products at half the cost. If a seller approaches you to buy authenticated products at 50% off in bulk quantity, then avoid answering them.
- Urgency tactics like "last-day discount" or "overstock clearance." Professional Chinese suppliers don’t create this hype. This is a clear indicator of the potential fraud.
- Requests for full payment up front in exchange for discounts. When importing products in bulk, importers make 100% payments to get 10-15% discounts, despite having goods on hand.
Always ask yourself why the price is so low. If it seems too good to be true, it almost certainly is.
Step 6: Understand Incoterms & Choose the Right Shipping Method
Shipping terms like FOB, CIF, and DDP define who is responsible for transport, insurance, and customs. Misunderstanding these can result in hidden costs, delivery issues, or even seized cargo. So, it’s better to select the best shipping methods when importing from China.
Safe Incoterms for Indian importers:
- FOB (Free On Board): The supplier pays for transport to the Chinese port; you handle everything beyond.
- CIF (Cost, Insurance, Freight): Supplier pays for ocean freight and insurance to the Indian port; you manage customs clearance.
- DDP (Delivered Duty Paid): The supplier handles all logistics, including Indian customs clearance. This is ideal for startups, but more expensive.
Scammers use confusing shipping arrangements to hide costs. Work with a professional freight forwarder or import consultancy to ensure clarity.
Step 7: Inspect Goods Before and After Shipment.
As you’re located in India, such as Mumbai and Chennai, it’s tough to personally inspect the goods in China. You think what is the best way to be 100% sure to import goods? Third-party inspections are essential to check that your shipment matches the agreed terms.
Types of inspections to prefer:
- Pre-shipment inspection: Done in China to check product specs, packaging, and labeling before goods leave the factory and the container starts the journey.
- Container loading check: This type checks that the right quantity is loaded and sealed correctly. This frees you from any counterfeit or defective goods brought to India.
- Post-arrival inspection: Conducted in India to verify goods before submitting to customs clearance. This avoids any unconditional and illegal activity, invoking issues.
Prefer reputable inspection agencies, including SGS, TÜV Rheinland, QIMA, and Bureau Veritas. At iLife Import, we coordinate these inspections for our clients.
Step 8: Stay Updated on Indian Import Regulations.
Scammers sometimes ship goods under incorrect HS Codes to bypass customs checks or import duties. This can lead to your shipment being confiscated or delayed. Also, the strict customs clearance regulations don’t allow these goods to be useful and raise questions about your business's legitimacy.
Stay informed about:
- DGFT notifications for banned or restricted goods.
- BIS certification requirements for electronics and toys.
- FSSAI approval for food products.
- WPC or EPR requirements for wireless or plastic items.
Ensure all paperwork from the invoice, packing list, and Certificate of Origin is accurate and verified. A consultancy like iLife Import can help ensure 100% compliance with international trading agreements.
Step 9: Partner with a Reliable Import Service.
Ultimately, the best way to avoid scams is to work with professionals who understand the risks and have proven systems in place to mitigate them.
Looking for the best import service provider in India to help you get your goods securely to your door from China?
Then choose iLife Import.
Here is a brief overview we follow at iLife Import:
- Conduct on-ground supplier verification in China.
- Draft legally enforceable contracts.
- Offer secure payment channels.
- Handle pre- and post-shipment inspections.
- Manage shipping and Indian customs clearance.
- Offer end-to-end import solutions tailored to your business.
By working with us, you eliminate the guesswork, reduce risk, and import with full confidence.
Final Words
Importing goods from China to India is a powerful growth strategy, but it comes with its own set of risks. Scams can bite your business, but with the right precautions and expert guidance, they are entirely avoidable.
Always verify your supplier, never skip samples, use safe payment methods, create proper contracts, and stay updated with regulations. And if you want to focus on growing your business without worrying about scams or shipment issues. Consider partnering with iLife Import, your trusted gateway to safe and seamless international trade.
Ready to import safely from China? Contact iLife Import today and let us simplify your import journey from start to finish. We’re a trustworthy import consultancy in India, and we’re proud of it.
