The government has relaxed export obligation under the Export Promotion Capital Goods (EPCG) scheme  for the hotel, healthcare, and educational sectors which were badly hit by the Covid-19 pandemic. “For the years 2020-21 and 2021-22, these sectors will not be required to maintain average export obligation for EPCG authorisations issued to them. These sectors will also have the option to extend the export obligation period for a longer duration, without having to pay any additional fees,” according to a press statement issued by the Commerce Department.

The EPCG scheme is a trade promotion scheme implemented by the Centre that allows duty-free import of capital goods for the purpose of export production in India. For EPCG authorisations issued for the hotel, 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 within February 1, 2020 and March 31, 2022. 

This extension will be granted without payment of composition fees. “However, for EPCG authorizations issued for sectors other than hotel, healthcare and educational, the export obligation period may be extended for the number of days the existing export obligation period falls within February 1, 2020 and July 31, 2021. This extension will be granted without payment of composition fees, but with a 5 per cent additional export obligation in value terms on the balance export obligation as on March 31, 2022,” it said.

This relaxation has been provided in light of the economic slowdown caused by the Covid-19 pandemic, the statement added.

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