The Directorate General of Foreign Trade (DGFT), under the Ministry of Commerce and Industry, Government of India, has issued Policy Circular No. 10/2025-26 dated February 26, 2026, granting relief in Average Export Obligation (EO) for the year 2024-25 under the Export Promotion Capital Goods (EPCG) Scheme.

The circular provides relief to exporters operating in sectors or product groups that have witnessed a decline of more than 5% in total exports during 2024-25 as compared to 2023-24. The measure has been issued in terms of paragraph 5.17(a) of the Handbook of Procedures (HBP) under the Foreign Trade Policy (FTP), 2023.

Proportionate Reduction in Average EO

As per the policy clarification, where a sector or product group has recorded a decline exceeding 5% in exports year-on-year, the Average EO for EPCG authorization holders in that sector may be reduced proportionately to the extent of the decline. The benefit will apply to sectors that experienced such contraction in 2024-25 compared to the preceding financial year.

The DGFT has annexed a list of product groups along with the percentage decline in exports during 2024-25 vis-à-vis 2023-24 to facilitate implementation of the relief measure.

Directions to Regional Authorities

All Regional Authorities of DGFT have been directed to re-fix the Annual Average EO for EPCG Authorizations for the year 2024-25 in accordance with the notified reductions. Any corresponding reduction in export obligation must be duly endorsed in the licence file maintained by the Regional Authority and reflected in the amendment sheet issued to the EPCG authorisation holder.

The circular further mandates that while considering requests for discharge of EO, Regional Offices must take into account earlier policy circulars issued under previous Handbooks of Procedures and the relevant provisions of FTP 2023, particularly in cases involving shortfall in EO fulfillment. This consideration must be incorporated into the check-sheet prepared for issuance of Export Obligation Discharge Certificate (EODC) and before any demand notice is issued.

Notification Details

Policy Circular No. 10/2025

Date: 26/02/2026

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