What EPCG work involves
- EPCG authorization application with correct capital goods description and ITC-HS classification
- Chartered Engineer nexus certificate linking the capital goods to the export product
- Average export obligation fixation and verification against past export performance
- Installation certificate from customs or a Chartered Engineer within the prescribed period
- Block-wise and overall export obligation monitoring with quarterly reporting
- Extension of export obligation period and condonation of delay where needed
- Invalidation letters for domestic sourcing of capital goods
- EODC redemption, bank guarantee release and closure of the customs bond
How the export obligation actually works
An EPCG authorization carries two obligations that people frequently confuse. The specific export obligation is a multiple of the duty saved, to be fulfilled in blocks over the obligation period through exports of the product manufactured on the imported machine. Separately, the average export obligation requires you to maintain the average level of exports of the same product achieved in the preceding three years, over and above the specific obligation. Missing the average, even while comfortably meeting the specific target, is a default — and it is the single most common reason redemption gets refused.
- Specific export obligation: a multiple of the duty saved amount, fulfilled block-wise
- Average export obligation: maintain the preceding three years' average exports of the same product
- Obligation period runs from the date of authorization issue
- Shipping bills must carry the EPCG authorization number to count towards fulfilment
Monitoring is the whole game
Once the machine lands, attention shifts to production and the licence file goes quiet — until a block deadline passes. We maintain an authorization-wise register with duty saved, specific and average obligations, block-wise fulfilment pulled from ICEGATE, and alerts on obligations falling due, so extensions are filed before expiry rather than condonation after it. Where a shortfall is genuinely unavoidable, we quantify the regularisation cost early enough for you to plan cash flow instead of discovering it in a demand notice.
Eligibility checklist
- Manufacturer exporter, or merchant exporter tied to a supporting manufacturer
- Valid IEC and RCMC from the relevant Export Promotion Council
- Capital goods required for pre-production, production or post-production of the export product
- Chartered Engineer certificate establishing nexus between the capital goods and export product
- Export track record for average obligation fixation, or nil average for a new product line
- Capacity to fulfil the specific export obligation within the notified obligation period
Our process, step by step
- 01Feasibility: duty saved and the resulting export obligation modelled against your realistic export plan before applying.
- 02Application: EPCG authorization filed on the DGFT portal with nexus certificate and capacity details.
- 03Import and installation: authorization registered at the port, and installation certificate obtained within the prescribed period.
- 04Monitoring: block-wise fulfilment tracked from ICEGATE with alerts, plus extensions filed ahead of expiry.
- 05Redemption: EODC application filed with CA-certified export statement and e-BRCs, followed through to bank guarantee release.