EXPORT PROMOTION CAPITAL GOODS (EPCG) SCHEME

Every businessman aims to introduce his products in foreign markets. For the products to meet international standards, businesses often have to import certain machinery. For this, the government has introduced the Export Promotion Capital Goods scheme, to be able to help such businesses bear the cost of machinery, customs duty, and other such perks.

Overview

The Export Promotion Capital Goods Scheme allows import of capital goods for pre-production, production, and post-production of products at zero customs duty.

Benefits

What benefits will a business avail from this scheme?

The benefits a business benefits will avail from this scheme are the permissions to:

  • Import machinery needed for their factory, minus the custom duty
  • Import capital goods such as computer software systems, spares, moulds, dies, jigs, fixtures, tools, refractories for initial lining and spare refractories, and catalysts for initial charge, plus one subsequent charge

Eligibility Criteria

Who are eligibility to apply for this scheme?

The following are eligible to apply for this scheme:

  • Manufacturer exporters with or without supporting manufacturers
  • Merchant exporters tied to supporting manufacturers and service providers
  • Service provider who is designated/certified as a common service provider (CSP) by the Directorate General of Foreign Trade (DGFT) Department of Commerce or State Industrial Infrastructural Corporation in a Town of Export Excellence

Application

How can a business apply for this scheme?

A business can apply for the EPGC license online by filling in the application here.

The steps to navigate through the site can be found here.

A business must file the application along with the necessary supporting documents with DGFT.

Documents Required

The complete list of documents needed to apply for this scheme can be found here.

Additional Information

Please take note of the information provided below:

  • Companies shall be subjected to export obligation (EO) equivalent to six times of duty saved on capital goods. This needs to be fulfilled in six years reckoned from date of issue of authorisation.
  • Authorisation shall be valid for 18 months from date of issue. Revalidation of EPCG authorisation is not permitted.
  • Second-hand capital goods shall not be permitted to be imported under this scheme.

Authorisation for import of the following capital goods (including captive plants and power generator sets of any kind) shall not be issued:

  • Export of electrical energy (power)
  • Supply of electrical energy (power) under deemed exports
  • Use of power (energy) in their own unit
  • Supply/export of electricity transmission services

For further information on this scheme, click here.

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