Export Promotion Capital Goods - EPCG Scheme

Export Promotion Capital Goods (EPCG) Scheme helps facilitate import of capital goods into India for producing quality goods and service and to enhance India's export competitiveness. EPCG scheme allows for import of capital goods used in pre-production, production and post-production at zero customs duty. In this article, we look at the basics for availing EPCG scheme in India.

EPCG Scheme Eligibility - Capital Goods

The following types of capital goods can be imported into India at zero customs duty under the EPCG scheme:

Plant, machinery, equipment or accessories required for manufacture or production, either directly or indirectly, of goods or for rendering services, including those required for replacement, modernisation, technological upgradation or expansion.
Packaging machinery and equipment
Refractories for initial lining
Refrigeration equipment
Power generating sets
Machine tools
Catalysts for initial charge
Equipment and instruments for testing, research and development, quality and pollution control.
Capital goods used in manufacturing, mining, agriculture, aquaculture, animal husbandry, floriculture, horticulture, pisciculture, poultry, sericulture and viticulture as well as those used in services sector.
Computer software systems
Spares, moulds, dies, jigs, fixtures
Catalysts for initial charge plus one subsequent charge

In addition to the above types of capital goods, other types of capital goods can also be permitted under the EPCG scheme subject to approval from the Exim Facilitation Committee at

DGFT. Note: Second hand capital goods are not eligible for EPCG scheme.

EPCG Scheme Eligibility - Applicant

Manufacturer exporters with or without supporting manufacturer(s), merchant exporters tied to supporting manufacturer(s) and service providers are eligible under the EPCG scheme. EPCG scheme also covers Common Service Provider (CSP).

Export Obligation under EPCG Scheme

Import of capital goods under EPCG scheme is subject to an export obligation equivalent to six times of duty saved, to be fulfilled in 6 years reckoned from date of issue of EPCG authorisation. In case, EPCG authorisation holder fails to fulfil prescribed export obligation, the importer is required to pay customs duties plus interest as prescribed by Customs authority. Export obligation can be fullfilled by the EPCG authorisation holder through export of goods which are manufactured by him or his supporting manufacturer/services rendered by him, for which EPCG authorisation has been granted. EPCG authorisation is valid for import for 18 months from date of issue and revalidation of EPCG authorisation is not permitted.

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Frequently Asked Questions

Common questions about Export Promotion Capital Goods Scheme for India.

The EPCG (Export Promotion Capital Goods) Scheme is an Indian government initiative that facilitates the import of capital goods into India at zero customs duty. The scheme aims to enhance India's export competitiveness by providing manufacturers and service providers with access to modern machinery and equipment for producing quality goods and services.

The EPCG Scheme allows for the import of various types of capital goods at zero customs duty, including plant, machinery, equipment, accessories, packaging machinery, refrigeration equipment, power generating sets, machine tools, testing and research equipment, computer software systems, spares, moulds, dies, jigs, fixtures, and catalysts, among others. These capital goods can be used for manufacturing, production, or rendering services across various sectors like agriculture, mining, and services.

Manufacturer exporters with or without supporting manufacturers, merchant exporters tied to supporting manufacturers, and service providers are eligible to apply for the EPCG Scheme. Additionally, Common Service Providers (CSPs) can also avail of the scheme.

Under the EPCG Scheme, the import of capital goods is subject to an export obligation equivalent to six times the duty saved. This export obligation must be fulfilled within six years from the date of issue of the EPCG authorization.

If the EPCG authorization holder fails to fulfill the prescribed export obligation, they will be required to pay the customs duties along with interest as prescribed by the Customs authority.

The export obligation can be fulfilled by the EPCG authorization holder through the export of goods manufactured by them or their supporting manufacturer, or through the services rendered by them, for which the EPCG authorization has been granted.

An EPCG authorization is valid for import for 18 months from the date of issue, and revalidation of the authorization is not permitted.

No, second-hand capital goods are not eligible for import under the EPCG Scheme.

Yes, other types of capital goods can also be permitted for import under the EPCG Scheme, subject to approval from the Exim Facilitation Committee at the Directorate General of Foreign Trade (DGFT).

The article does not mention any minimum value requirement for capital goods imported under the EPCG Scheme.