What is Export Promotion Capital Goods (EPCG) Scheme

What is Export Promotion Capital Goods (EPCG) Scheme:

  • The objective of the Export Promotion Capital Goods (EPCG) Scheme is to facilitate import of capital goods for producing quality goods and services and enhance India’s manufacturing competitiveness.
  • EPCG Scheme allows import of capital goods for pre-production, production and post-production at zero customs duty.
  • Capital goods imported under EPCG for physical exports are also exempt from IGST and Compensation Cess up to 31.03.2020.
  • Alternatively, the exporter may also procure Capital Goods from domestic market in accordance with provisions of paragraph 5.07 of FTP.

Capital goods for the purpose of the EPCG scheme shall include:

  • Capital Goods as defined in Chapter 9
  • Computer systems and software which are a part of the Capital Goods
  • Spares, moulds, dies, jigs, fixtures, tools & refractories
  • Catalysts for initial charge plus one subsequent charge

EPCG scheme covers the following:

  • Manufacturer exporters with or without supporting manufacturer(s), merchant exporters tied to supporting manufacturer(s) and service providers.

Pre-Requisites for Applying for EPCG Scheme

  • To apply for an EPCG scheme, an IEC is required.
  • Other pre-requisites as mentioned in the Chapter 5 of Foreign Trade Policy and Hand book of Procedures may be referred.

Apply for EPCG Schemes