The Ministry of Commerce and Industry has issued a press release relaxing the Export Promotion Capital Goods (EPCG) Scheme for Sectors Affected by the COVID-19 Pandemic. The press release was issued on 20th January, 2023.
The (EPCG) Scheme is a trade promotion scheme that allows the duty-free import of capital goods for the purpose of export production in India. The scheme aims to encourage the production of goods for export by providing import duty concessions on capital goods. The EPCG scheme is administered by the Directorate General of Foreign Trade (DGFT) and is governed by the Foreign Trade Policy of India.
The press release has announced a one-time relaxation from maintaining average export obligation and an option to extend the export obligation period for a longer duration. These reliefs will be enabled without the necessity of having to pay any additional fees.
The sectors that are eligible for this relief are the hotels, healthcare, and educational sectors. These sectors will not be required to maintain their average export obligations for the years 2020-21 and 2021-22.
For EPCG authorizations issued for the hotels, healthcare, and educational sectors, the export obligation period would be extended from the date of expiry for the duration equivalent to the number of days the export obligation period falls between 1st February, 2020, and 31st March, 2022.
For EPCG authorizations issued for sectors other than hotel, healthcare, and educational sectors, the export obligation period may be extended for the number of days the existing export obligation period falls between 1st February, 2020, and 31st July, 2021.
This relaxation has been provided in light of the economic slowdown caused by the COVID-19 pandemic. This relief will help the sectors to cope with the negative impact of the pandemic on their export activities.
