Relief in maintenance of Annual Average Export Obligation under EPCG for 2022-23
No: CLE/HO/Pol.Circular/2024
13.03.2024
All Members of the Council
Sub : Relief in maintenance of Annual Average Export Obligation under EPCG
for 2022-23
Dear Members,
As you are kindly aware, Para 5.17 of the Handbook of Procedures of Foreign Trade Policy (FTP) 2023 envisages the following.
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.
The above implies that the sector / product group that witnessed such decline in 2022-23 as compared to 2021-22 would be entitled for such relief.
Accordingly, the DGFT has issued Policy Circular NO. 10/2023-2024 dated 22nd February 2024, notifying the list of products which have undergone decline by more than 5% during 2022-23 as compared to 2021-22. The list includes the following products concerning leather and footwear sector.
| S. No | HS Code | Commodity | Export Figures (Value in US $ Mn) | % decline | |
| 2021-22 | 2022-23 | ||||
| 1 | 4115 | Composition Leather with a basis of Leather or Leather Fiber, in slabs, sheets or strip, whether or not in Rolls; | 0.25 | 0.04 | -84.35 |
| 2 | 4301 | Raw Frskns (Incl Heads, Tails, Paws and Other PCS Cutngs Sutble FR Furriers use) Except Raw Hides and Skns of Hdngs NO | 0.01 | 0 | -55 |
| 3 | 4304 | Articles of Apparel, Clothing Accessories and Other Articles of Furskin | 23.81 | 14.69 | -38.31 |
| 4 | 4201 | Saddlery and Harness for any Anml (Incl Tractsleads, Knee Pads, Muzls, Sddle Cloths, Sddle Bags-Dog Coats and the like) of | 276.03 | 222.17 | -19.51 |
| 5 | 4107 | Leather Further prepared after Tanning or Crusting, Including Parchment-Dressed Leather of Bovine (including Buffal) | 309.66 | 271.79 | -12.23 |
| 6 | 4205 | Other Articles of Leather or of Composition Leather | 56.61 | 49.87 | -11.91 |
| 7 | 6404 | Footwear with Outer Soles of Rubr-Plstcs etc and Uppers of Txtl Matrls | 228.61 | 211.75 | -7.38 |
As per the above policy circular, All Regional Authorities of DGFT have been requested to re-fix the Annual Average Export Obligation (EO) for EPCG Authorizations for the year 2022-23. Reduction, if any, in the EO should be appropriately endorsed in the licence file of the Office of RA as also in the amendment sheet to be issued to the EPCG Authorisation holder.
This is for your information.
With kind regards,
Selvam, IAS
Executive Director
Council for Leather Exports.