Context
The Directorate General of Foreign Trade (DGFT) has removed the requirement to submit physical duty-payment challans while applying for an Export Obligation Discharge Certificate (EODC) under the Advance Authorisation and EPCG Schemes.
About the EPCG Scheme
The Export Promotion Capital Goods (EPCG) Scheme is a trade-promotion measure of the Government of India that facilitates the import of capital goods at zero customs duty, subject to fulfilment of the prescribed export obligation.
The scheme was operationalised on 1 April 2015 and is administered by the DGFT under India’s Foreign Trade Policy.
Its objective is to enable exporters to access capital goods required for producing quality goods and services and thereby improve India’s manufacturing and export competitiveness.
Key Features
- Zero customs duty: Eligible capital goods can be imported at zero customs duty for pre-production, production and post-production activities.
- Coverage: The scheme covers manufacturer exporters, with or without supporting manufacturers; merchant exporters tied to supporting manufacturers; and service providers.
- Export obligation: Beneficiaries must fulfil the prescribed export obligation to avail the duty benefit.
- Second-hand goods: Second-hand goods of any nature are not permitted under the scheme.
- Administration: The scheme is implemented by the DGFT, under the Foreign Trade Policy.
Frequently Asked Questions
Q1. What is the EPCG Scheme?
Ans: The Export Promotion Capital Goods Scheme facilitates the import of eligible capital goods at zero customs duty, subject to fulfilment of the prescribed export obligation.
Q2. Which authority administers the EPCG Scheme?
Ans: The scheme is administered by the Directorate General of Foreign Trade (DGFT) under India’s Foreign Trade Policy.
Q3. When was the EPCG Scheme operationalised?
Ans: The EPCG Scheme was operationalised on 1 April 2015.
Q4. Which activities are covered under the EPCG Scheme?
Ans: Eligible capital goods can be imported for pre-production, production and post-production activities.
Q5. Does the EPCG Scheme cover both goods and services?
Ans: Yes. The scheme covers exporters dealing in goods as well as services, subject to applicable conditions.
Q6. Are second-hand capital goods permitted under the EPCG Scheme?
Ans: No. Second-hand goods of any nature are not permitted under the EPCG Scheme.
Q7. What recent change has been made under the EPCG Scheme?
Ans: The DGFT has removed the requirement to submit physical duty-payment challans while applying for an EODC under the EPCG and Advance Authorisation Schemes.
