🌟 Export Promotion Capital Goods (EPCG) Scheme – Complete Guide
🔍 What is the EPCG Scheme?
The Export Promotion Capital Goods (EPCG) Scheme is a flagship initiative by the Directorate General of Foreign Trade (DGFT), Ministry of Commerce and Industry, Government of India.
Under this scheme, Indian exporters are allowed to import capital goods (machinery, equipment, etc.) at zero customs duty, with the obligation to export goods/services worth six times the duty saved over a period of six years.
The main objective of EPCG is to encourage the production of quality goods and services in India, enabling exporters to be globally competitive.
🏭 What are Capital Goods?
Capital goods are those assets used in the manufacturing of finished products. These include:
Machines
Tools
Equipment
Spare parts (up to 10% of CIF value)
Moulds and dies
Instruments and apparatus
These goods can be used for pre-production, production, and post-production activities.
🎯 Objectives of the EPCG Scheme
Enhance India’s Export Competitiveness
Encourage Technological Upgradation
Promote ‘Make in India’
Facilitate Modernization of Indian Industry
✅ Key Features of the EPCG Scheme
| Feature | Description |
|---|---|
| Import Duty | Capital goods can be imported at 0% customs duty |
| Export Obligation | Must export goods/services worth 6 times the duty saved in 6 years |
| License Validity | Valid for 18 months for import, and 6 years for fulfilling EO |
| Capital Goods Age Limit | Both new and second-hand capital goods (with conditions) are allowed |
| Domestic Procurement | Capital goods can also be sourced domestically under EPCG |
| EO Extension | Export Obligation period can be extended with valid justification |
| No Duty Drawback | No drawback allowed for duty saved portion under EPCG |
👨💼 Who Can Apply?
The scheme is open to:
Manufacturer Exporters
Merchant Exporters tied to supporting manufacturers
Service Providers (e.g., hotels, logistics, hospitals, IT firms, etc.)
🧾 EPCG License Application – Required Documents
IEC (Importer Exporter Code) Certificate
- DGFT Login ID and Password
GST Registration
PAN of the Company/Firm
Digital Signature Certificate (DSC)
Technical Write-up or Brochure of capital goods
Proforma Invoice from supplier (foreign or Indian)
Chartered Engineer Certificate (CE)
Past Export Performance (if any)
RCMC (Registration cum Membership Certificate) from EPC