What’s in the news?
- Exports of Engineering Goods jumped to USD 81.8 Billion during April-December 2021 (Provisional) as compared to USD 52.9 Billion during same period in the previous year (2020), registering a stupendous growth of 54%.
- Engineering Goods sector constitutes the largest, more than 27%, share of India’s total exports basket during the period.
- As compared to April-December 2019 (USD 59.8 Billion), exports of Engineering Goods registered a growth of 37% while this represents a growth of 49% compared to April-December 2014 (USD 55.0 Billion).
- India’s top five export destinations for the Engineering Goods sector in April-November 2021 (as per latest available data, share per cent mentioned in bracket) are: USA (14.7%), China (5.8%), UAE (5.1%), Italy (4%) & Germany (3.4%).
- The impressive growth in Engineering Goods exports in recent years has largely been due to the Zero duty Export Promotion Capital Goods (EPCG) scheme of the Ministry of Commerce & Industry and forms part of the Foreign Trade Policy (FTP) of Government of India.
- The present Policy which came into force on 1st April, 2015, was for 5 years with validity upto 31st March, 2020. In order to provide policy stability during the pandemic period, FTP 2015-20 was extended for the year 2021-22 i.e. up to 31st March 2022.
- The scheme allows import of capital goods for pre-production, production and post-production (including Completely Knocked Down/ Semi Knocked Down thereof as well as computer software systems) at zero Customs duty, subject to an export obligation equivalent to 6 times of duty saved on capital goods imported under EPCG scheme, to be fulfilled in 6 years reckoned from Authorization issue-date.
- The Engineering Goods sector comprises of metal products, industrial machinery and equipment, automobiles and its components, transport equipment, bicycles, medical devices and renewable equipment.