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 manufacturer exporters with or without supporting manufacturer(s), merchant exporters tied to supporting manufacturer(s) and service providers. Licence under EPCG Scheme can be applied by any Exporter irrespective of his turnover. EPCG License can be issued to the following category of Exporters: Manufacturer Exporter / Merchant Exporter tied to supporting manufacturer / Service Provider

Indigenous Sourcing of Capital Goods-

The Exporter can also indigenously procure capital goods from a domestic manufacturer. Such domestic manufacturers shall be eligible for deemed export benefits.

Export Obligation under EPCG scheme

Export Obligation under EPCG Scheme is of two types i.e. Average Export Obligation & Specific Export Obligation.

Conditions for fulfillment of Export obligation under EPCG Scheme:

• - Export Obligation under EPCG Scheme should only be fulfilled by the export of goods manufactured from the Imported/Domestically procured Machinery.
• - Average Export Obligation under EPCG scheme is Average turnover maintained in the past 3 years before obtaining the license should be maintained for each FY until the specific export obligation is completed.

Our Role

• - Total guidance about the benefits of the scheme and the areas where the exporters go wrong and ways to avoid those mistakes.


• - Manual and Online application for EPCG Licence.


• - Followup and getting EPCG License from Director General of Foreign Trade.


• - Block wise E. O extension


• - Average export reduction


• - Export obligation discharge through alternate products manufactured by the licence holder


• - Other relaxations through representation at EPCG committee.