§1Who it is for

  • Manufacturer exporters (with or without supporting manufacturers), merchant exporters tied to supporting manufacturers, service providers, Common Service Providers in Towns of Export Excellence / PM MITRA

Useful if

Exporters buying new machinery and confident of steady export growth.

Do not spend time on it if

First-time exporters without a firm export order book.

§2Eligibility

  1. Capital goods not in negative list (Appendix 5F)
  2. Restricted capital goods only after Exim Facilitation Committee approval
  3. Actual User condition till EO completed and EODC granted (FTP 5.03)
  4. CSP must give BG equal to duty saved and install goods in a Town of Export Excellence or PM MITRA (FTP 5.02(b))

§3Benefits

  • Zero customs duty on import of capital goods; IGST and Compensation Cess also exempt for physical exports (FTP 5.01(a))
  • Domestic sourcing of capital goods allowed; domestic supplier gets deemed export benefits (FTP 5.07)

§4Norms — pattern of assistance

  1. Export Obligation = 6 times duties, taxes and cess saved, to be met in 6 years from date of issue (FTP 5.01(b))
  2. EO is over and above Average Export Obligation (average exports of preceding 3 licensing years), to be met every year (FTP 5.04(c))
  3. Indigenous sourcing: specific EO 25% less (FTP 5.04(d))
  4. Green technology products: specific EO 75% of normal (FTP 5.10)
  5. North East states, J&K and Ladakh: specific EO 25% of normal (FTP 5.11)
  6. Early fulfilment: if 75% EO and 100% AEO met in half the period, rest is condoned (FTP 5.09)
  7. No AEO for handicrafts, handlooms, KVIC, agriculture, aquaculture, animal husbandry/dairy, floriculture/horticulture, poultry, viticulture, sericulture, carpets, coir, jute (FTP 5.12)
  8. Authorisation valid for import for 24 months; no revalidation (FTP 5.01(d))
  9. Installation certificate within 6 months of import completion; extension up to 12 months with ₹5,000 composition fee (HBP 5.04)
  10. Agri Export Zone units: LUT/Bond or 15% BG (FTP 5.06)

§5Documents

Tick each one as you get it ready.

RCMC

§6How to apply

  1. 1

    File ANF 5A on dgft.gov.in with CE nexus certificate

  2. 2

    Import or source capital goods

  3. 3

    Submit installation certificate

  4. 4

    Track EO block-wise and apply for EODC

§7Pros and cons

Merits

  • Big saving on machinery cost at purchase time
  • Reduced EO for green tech, NE region and domestic machinery

Demerits

  • EO is 6x duty saved over and above past average exports — hard for a new small exporter
  • Bank guarantee/bond blocks working capital until EODC

→Related schemes

Need help with EPCG?

Eligibility check, DPR and application file — ask us on WhatsApp.

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Our interestHelp is our paid service. You can also apply for the scheme yourself.

Sources

  1. FTP 2023 Chapter 5 — EPCG Scheme (DGFT)
  2. Handbook of Procedures 2023 Chapter 5 — EPCG (DGFT)

Checked on 18 October 2026. For information only — confirm with the department or bank. Spotted a mistake? Report it.