The Hindu Business Line : Obligation for agri zones under EPCG set at 12 years

UNITS in the Agri Export Zones (AEZ) of the country can now fulfil their export obligations under the Export Promotion Capital Goods (EPCG) scheme over a period of 12 years from the date of issuance of EPCG licence.

"A period of 12 years has been permitted for fulfilment of export obligation in the case of those units in the AEZs that have opted for the EPCG scheme," a senior official of the Directorate-General of Foreign Trade (DGFT) said here.

The Exim Policy already allows service providers in AEZs to move or shift the capital goods within the zone so long as an accurate record of such movements is maintained. However, the capital goods should not be sold or leased by the EPCG licence-holder.

The EPCG scheme allows import of new capital goods at five per cent customs duty, subject to a condition that an export obligation equivalent to five times the cost, insurance and freight (c.i.f) value of capital goods have to be fulfilled over a period of eight years reckoned from the date of issuance of licences. The Exim Policy already provides that the export obligation would have to be fulfilled over a period of 12 years in respect of those EPCG licences that are worth Rs 100 crore or more.

The Government had formulated the AEZ scheme to transform select rural areas of the country into a hub of agri-export activities. The Union Government has so far sanctioned more than 25 AEZs.

Meanwhile, the Government has sanctioned four more AEZs in the country - apples in Himachal Pradesh (Shimla, Sirmaur, Kullu, Mandi, Chamba and Kinnaur); basmati rice in Punjab (Gurdaspur, Amritsar, Kapurtala, Jalandhar, Hoshiarpur and Nawanshahar); flowers in the Nilgiris district of Tamil Nadu; and mangoes in the Krishna District of Andhra Pradesh.

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Obligation for agri zones under EPCG set at 12 years