EPCG Scheme

In one line, the Export Promotion Capital Goods Scheme (EPCG Scheme) can be explained as “Duty-Free (Zero Customs Duty) Import of Capital Goods/Machinery for the manufacture of products meant for Export.” The Capital Goods may be used for production, pre-production & post-production stages of goods. This scheme is also known as zero duty EPCG scheme. We are all well aware of the heavy custom duties companies have to pay on the Capital machinery imported for the production requirements, due to which businessmen usually do not import them and compromise with the quality of the goods. The higher the price of the Machinery used to be, the higher the custom duty was, and this functionality started affecting the competitiveness and quality of manufacturing industries deeply. To improve this situation, The Government of India came up with a scheme where it was allowed to import capital goods at zero customs duty. EPCG Scheme was introduced by the Government of India to facilitate the Import of Capital Goods/Machinery for producing high-quality goods and services. The main aim of the EPCG Scheme is to improve India’s competitiveness in the manufacturing sector.

Under the EPCG Scheme, below are the Type of Capital Goods / Machinery eligible for Import

All the capital goods, including semi-knocked down and complete, knocked down conditioned goods.
All the software and computer systems included in the capital goods that are imported.
Moulds, spares, jigs, dies, tools, fixtures, and refractories.
Catalysts for initial charge along with one subsequent charge.