By Policy Circular No. 10/2025-26 dated February 26, 2026, the Directorate General of Foreign Trade (DGFT) issued guidance on relief in Average Export Obligation (EO) under the EPCG Scheme in terms of Para 5.17(a) of the Handbook of Procedures (HBP) of FTP, 2023. The provision allows proportionate reduction in Average EO for sectors or product groups where total exports declined by more than 5% in 2024-25 compared to 2023-24. A list of such product groups indicating percentage decline has been annexed. Regional Authorities have been directed to re-fix the Annual Average EO for EPCG authorisations for 2024-25 and endorse reductions in licence files and amendment sheets. While processing EO discharge requests, Regional Offices must also consider earlier policy circulars issued under prior FTPs before issuing demand notices or EODCs. The circular has been issued with the approval of the Director General of Foreign Trade.
Government of India
Ministry of Commerce and Industry
(Directorate General of Foreign Trade)
Vanijya Bhawan, New Delhi
Web Site: http://dgft.gov.in
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Policy Circular No. 10/2025-26-DGFT | Dated: 26 February, 2026
To,
All Regional Authorities of DGFT/
All Customs Authorities
Subject: EPCG Scheme – Relief in Average EO in terms of the para 5.17(a) of Hand Book of Procedures (HBP) of FTP, 2023.
The para 5.17 of the HBP of the FTP, 2023 envisages that to provide relief to exporters of those sectors where total exports in that sector/product group has declined by more than 5% as compared to the previous year, the Average Export Obligation (EO) for the year may be reduced proportionate to reduction in exports of that particular sector/product group during the relevant year as against the preceding year. This implies that the sector/product group that witnessed such decline in 2024-25 as compared to 2023-24 would be entitled for such relief.
2. A list of product groups showing the percentage decline in exports during 2024-25 as compared to 2023-24 is Annexed.
3. All Regional Authorities are requested to re-fix the Annual Average EO for EPCG Authorizations for the year 202425 accordingly. The reduction, if any, in the EO should be appropriately endorsed in the licence file of the Office of Regional Authority and also in the amendment sheet to be issued to the EPCG Authorisation holder.
4. Regional Offices while considering requests of discharge of EO will ensure that in case of shortfall in EO fulfilment, Policy Circulars issued earlier in terms of Para 5.11.2 of HBP 2009-14, Para 5.19 of HBP of FTP 2015-20 and Para 5.17 of FTP, 2023 are also considered before issuance of demand notice, EODC etc. This stipulation should be part of Check-Sheet for the purpose of EODC.
5. This issues with the approval of Director General of Foreign Trade.
Enclosures: As mentioned above.
(Randheep Thakur)
Joint Director General of Foreign Trade
Tel. No. 011-2303 8731
E-mail: randheep.thakur@gov.in
(Issued from F. No. 18/43/AM-26/P-5)
