The Export Promotion Capital Goods (EPCG) scheme is a government initiative by the Directorate General of Foreign Trade (DGFT) that allows exporters to import capital goods at **reduced or zero customs duty** to produce goods for export. This scheme helps Indian exporters enhance their competitiveness in global markets.
Why EPCG is Important?
- Reduces capital investment cost for exporters.
- Encourages modernization of manufacturing units.
- Boosts global competitiveness of Indian products.
- Facilitates expansion and diversification of production.
Benefits of EPCG
- Duty-free import of capital goods for exports.
- Reduces overall production costs for exporters.
- Helps access advanced machinery for better quality products.
- Export obligations can be fulfilled over a period of 6 years.
Eligibility Criteria
- Any Indian exporter who is registered with DGFT.
- Must have a valid IEC (Import Export Code).
- Company, LLP, Proprietorship, or Partnership firm can apply.
Required Documents
- IEC (Import Export Code)
- PAN Card of the business entity
- Bank certificate or import-export bank account proof
- Application form (ANF 5 for EPCG)
- Letter of undertaking or bond to fulfill export obligation
Key Tips
- Export obligation must be fulfilled within the specified time (usually 6 years).
- Maintain proper records of imports and exports for compliance.
- Plan capital goods imports according to production needs to maximize benefits.
- Ensure timely submission of reports to DGFT to avoid penalties.
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