Engineering Goods exports register a growth of 54% and jump to USD 81.8 Billion during April-December 2021 as compared to USD 52.9 Billion during same period in the previous year (2020)

What is the News?

The Engineering Goods exports have registered a growth of 54% during April-December 2021 as compared to the same period in the previous year (2020).

What are Engineering Goods?

The Engineering Goods sector comprises metal products, industrial machinery and equipment, automobiles and their components, transport equipment, bicycles, medical devices and renewable equipment.

Why has there been tremendous growth in Engineering Goods Exports?

The impressive growth in Engineering Goods exports in recent years has largely been due to the zero duty Export Promotion Capital Goods (EPCG) Scheme.

What is the Export Promotion Capital Goods (EPCG) Scheme?

Nodal Ministry: Ministry of Commerce & Industry 

The scheme forms part of the Foreign Trade Policy(FTP) 

Note: The present FTP policy came into force in 2015 with validity up to 2020. In order to provide policy stability during the pandemic period, the policy was extended up to 31st March 2022.

The scheme allows the import of capital goods for pre-production, production and post-production at Zero customs duty.  

However, imports under EPCG Scheme are subject to an export obligation. Such as, the goods manufactured from the imported machinery should be exported worth 6 times of the duties, taxes, and cess saved on the capital goods within 6 years from the Authorization issue date.

Source: This post is based on the article ‘Engineering Goods exports register a growth of 54% and jump to USD 81.8 Billion during April-December 2021 as compared to USD 52.9 Billion during same period in the previous year (2020) ’ published in PIB on 25th January 2022.