The Export Promotion Capital Goods (EPCG) scheme under the Foreign Trade Policy lets exporters import capital goods for pre-production, production and post-production at zero customs duty. In return, the exporter must achieve an export obligation equal to six times the duties saved, within six years from the date the authorisation is issued. You apply online on the DGFT portal.
How the EPCG scheme works
You get an EPCG authorisation for the capital goods you need, import or buy them domestically without paying the applicable duty, and then export goods produced with them. The export obligation is counted in foreign exchange earned from those exports.
Who can use EPCG?
- Manufacturer exporters, and merchant exporters tied to supporting manufacturers
- Service providers whose services are exported
- Businesses that can meet the export obligation in the time allowed
The export obligation
- Specific obligation: exports worth six times the duty, taxes and cess saved, within six years
- Average obligation: you must also keep up your normal average level of exports in the same product line
- Exports are tracked against the authorisation, and an EO discharge certificate is issued once the obligation is met
How to apply
- Prepare details of the capital goodsDescription, technical specifications, value and duty saved.
- Apply on the DGFT portalFile the EPCG application with IEC, RCMC and supporting documents.
- Get the authorisationDGFT issues the EPCG authorisation for the approved capital goods.
- Register it at the portRegister the authorisation with customs and import the goods duty-free.
- Track and dischargeReport exports against the obligation and apply for EO discharge once complete.
Frequently asked questions
What is the export obligation under EPCG?
Six times the duties, taxes and cess saved on the capital goods, to be fulfilled within six years from the date of the authorisation, plus maintaining your average exports.
Can EPCG be used with RoDTEP and Duty Drawback?
EPCG is for capital goods and can generally run alongside shipment-level schemes. See our RoDTEP vs Drawback vs EPCG guide.
What happens if the export obligation is not met?
The duty saved has to be paid back with interest for the unfulfilled part.
Do I need an RCMC for EPCG?
Yes, a valid RCMC from the relevant export promotion council is generally required with the application.
How BuyGenix Solutions helps
We assess whether EPCG suits your expansion, prepare and file the authorisation, register it with customs and track your export obligation. BuyGenix members can also see live buyer requirements that help meet that obligation.
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BuyGenix Solutions handles epcg scheme and every related registration your business needs, from documentation to filing.
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