EFCG stands for Export Promotion Capital Goods. Let us understand what it means in detail.

Export Promotion Capital Goods (EPCG) Scheme is an export promotion scheme that allows import of capital goods for pre-production, production, and post-production at zero customs duty. This scheme promotes exports by enabling Indian manufacturers to import capital goods at a concessional rate of customs duty for producing quality goods and enhancing their competitiveness in the global market.

The EPCG scheme is administered by the Directorate General of Foreign Trade (DGFT) under the Ministry of Commerce and Industry, Government of India. It provides a range of benefits to Indian exporters, including reduced costs of production, improved quality, and increased competitiveness in the global market.

Some of the key features of the EPCG scheme are:

1. Zero customs duty on import of capital goods: Under the EPCG scheme, Indian manufacturers can import capital goods at zero customs duty. This reduces their production costs and helps them produce quality goods at a competitive price.

2. Export obligation: The scheme requires the beneficiary to fulfill an export obligation equivalent to six times the duty saved on the import of capital goods. This obligation must be fulfilled within a period of six years from the date of issuance of the license.

3. Validity of the license: The license issued under the EPCG scheme is valid for 24 months from the date of issuance and can be extended up to 36 months by the DGFT.

4. Eligibility criteria: To be eligible for the EPCG scheme, an exporter must have a minimum of two years of experience in the relevant field and must have earned a foreign exchange of at least Rs. 1 crore in the preceding financial year.

In conclusion, the EFCG stands for Export Promotion Capital Goods, which is an export promotion scheme that allows Indian manufacturers to import capital goods at zero customs duty for producing quality goods and enhancing their competitiveness in the global market. This scheme is administered by the DGFT and provides a range of benefits to Indian exporters, including reduced costs of production, improved quality, and increased competitiveness in the global market.