Government Bans Zero Duty Import of Capital Goods for Power Plants

New Delhi: The government on Monday banned duty-free import of capital goods for power generation and transmission projects under the Export Promotion Capital Goods (EPCG) scheme.

The decision is aimed at encouraging manufacturing of power equipment and giving a push to domestic capital goods sector, with an aim to boost the overall economy.

Amending the Foreign Trade Policy 2015-20, the Directorate General of Foreign Trade (DGFT) in an order said, “Authorisation under EPCG Scheme shall not be issued for import of any Capital Goods for generation/transmission of power (including Captive plants and Power Generator Sets of any kind).”

The EPCG scheme allows import of capital goods for pre-production, production and post-production at zero custom duty.

The government has fixed a target of 88,537 MW power generation capacity addition for the 12th Plan period ending 2016-17.

Till December 2015, 72,240.12 MW or 81.59 per cent of the target has achieved, data from the Central Electricity Authority showed.