Note: 1
Agencies/Funds notified by the Government of India, Ministry of Finance, Dept. of Economic Affairs vide their Public Notice No: 1(FT)/DEA/2000 dated 9th August, 2000 :-
1. International Bank for Reconstruction and Development (IBRD) and the International Development Association (IDA).
2. International Fund for Agricultural Development (IFAD).
3. Asian Development Bank (ADB).
4. Organisation of Petroleum Exporting Countries (OPEC) Fund.
5. Yen credit channelised through Japan Bank for International Cooperation (JBIC). (Development component only).
6.
4. General Requirements
for getting approval
A consolidated application
seeking permission for setting up of a Unit and other
clearances, including those indicated below, shall be made to the Development
Commissioner, in Form F, in five copies, with a copy to the Developer:-
(a)
Setting up of unit in a Special Economic Zone;
(b)
Annual permission for sub-contracting;
(c)
Allotment of Importer-Exporter Code number;
(d)
Allotment of land/industrial sheds in the Special Economic Zone;
(e)
Water connection;
(f)
Registration-cum-Membership Certificate;
(g)
Small Scale Industries Registration;
(h)
Registration with Central Pollution Control Board;
(i)
Power connection;
(j)
Building approval plan;
(k)
Sales tax registration;
(l)
Approval from inspectorate of factories;
(m)
Pollution control clearance, wherever required;
(n)
Any other approval as may be required from the State Government.
(i)
Nature of
industrial undertaking
(ii)
Items of
manufacture activity/service activity
(iii)
Investment in
Plant and machinery
(iv)
Import and
indigenous requirements of material and other inputs
(v)
Infrastructure
requirements
(vi)
Details of
Foreign collaboration
(vii)
Pattern of
shareholding
(viii)
Foreign
Exchange Balance sheet for the 5 years
(ix)
Details of
Industrial license or LOI/LOA under SEZ/EOU /STP/EHTP Scheme
(x)
Details of
sub-contracting in manufacturing operations
The Development Commissioner
shall get the proposal scrutinized and get it placed before the Approval
Committee for its consideration.
The proposals received under
following clauses shall be placed before the Board by the Development
Commissioner for its consideration.
a)
Granting of approval to the Developers or Units (other than the Developers or
the Units which are exempt from obtaining approval under any law or by the
Central Government) for foreign collaborations and foreign direct investments,
(including investments by a person resident outside
b) Granting, notwithstanding
anything contained in the Industries (Development and Regulation) Act, 1951, a
licence to an industrial undertaking referred to in clause (d) of
Section 3 of that Act, if such undertaking is established, as a whole or part
thereof, or proposed to be established, in a Special Economic Zone
The Approval Committee may
approve or approve with modification or reject a proposal placed before it
within fifteen days of its receipt
Where the approval is to be
granted by the Board, the Board shall approve or approve with modification or
reject such proposal within forty-five days of its receipt:
Approval Committee or the
Board, shall record the reasons, in writing, where it approves a proposal with
modifications or where it rejects a proposal and Development Commissioner by
order shall communicate such reasons to the person making the proposal.
The Approval Committee shall
approve the proposal if it fulfills the following requirements,
(i)
Net foreign exchange earning requirement
The proposal meets with the
positive net foreign exchange earning requirement
(ii)
Availability of infrastructure
-
Availability of space and other infrastructure support applied for is
confirmed by the Developer in writing, by way of a provisional offer of space
-
Developer shall enter into a lease agreement and give possession of the space
in the Special Economic Zone to the entrepreneur only after the issuance of
Letter of Approval by the Development Commissioner:
- A
copy of the registered lease deed shall be furnished to the Development
Commissioner concerned within six months from the issuance of the Letter of
Approval.
(iii)
Environmental norms -
The applicant undertakes to
fulfill the environmental and pollution control norms.
(iv)
Proof of residence -
The applicant submits proof
of residence, namely, passport or ration card or driving
license or voter identity card or any other proof of the proprietor or the
partners of partnership firms or Directors of the Company, as the case may be,
to the satisfaction of Development Commissioner;
The applicant submits the
Income tax returns, along with annexures, of the Proprietor or Partners, or in
the case of a company, audited balance sheet for the last three years.
(vi)
Net Foreign Exchange Earnings
-
The Unit shall achieve
Positive Net Foreign Exchange to be calculated cumulatively for a period of
five years from the commencement of production according to the following
formula, namely:-
Positive Net Foreign
Exchange = A – B >0 (Rule 53)
Where:
A:
is Free on Board value of exports, including exports to
(a)
Supply of goods against Advance License or Duty Free Replenishment Certificate
under the Duty Exemption or Remission Scheme or Diamond Imprest License under
the Foreign Trade Policy;
(b)
Supply of capital goods to holders of license under the Export Promotion
Capital Goods scheme under the Foreign Trade Policy;
(c) Supply of goods to
projects financed by multilateral or bilateral agencies or funds as notified
by the Department of Economic Affairs, Ministry of Finance under International
Competitive Bidding in accordance with the procedures of those agencies or
funds, where the legal agreements provide for tender
evaluation without including the customs duty;
(d)
Supply of capital goods, including those in unassembled or disassembled
condition as well as plants, machinery, accessories, tools, dies and such
goods which are used for installation purposes till the stage of production
and spares to the extent of ten per cent.of the free on rail value to
fertilizer plants;
(e)
Supply of goods to any project or purpose in respect of which the Ministry of
Finance, by a notification, permits the import of such goods at zero customs
duty;
(f)
Supply of goods to the power projects and refineries not covered in (e) above;
(g)
Supply to projects funded by United Nations Agencies;
(h)
supply of goods to nuclear power projects through competitive bidding as
opposed to International Competitive Bidding;
(i)
Supply made to bonded warehouses set up under the Foreign Trade Policy or
under section 65 of the Customs Act and free trade and warehousing zones,
where payment is received in foreign exchange;
(j)
Supply against special entitlements of duty free import of goods under the
Foreign Trade Policy;
(k)
Export of services by services units including services rendered within
Special Economic Zone or services rendered in the Domestic Tariff Area and
paid for in free foreign exchange or such services rendered in Indian Rupees
which are otherwise considered as having been paid for in free foreign
exchange by the Reserve Bank of India;
(l)
Supply of Information Technology Agreement items and notified zero duty
telecom or electronic items, namely, Color Display Tubes for monitors and
Deflection components for colour monitors or any other items as may be
notified by the Central Government;
(m)
Supply to other units and Developers in the same or other Special Economic
Zone or Export Oriented Unit or
(n)
Supply of goods to Domestic Tariff Area against payment in foreign exchange
from the Exchange Earners Foreign Currency account of the Domestic Tariff Area
buyer or Free Foreign Exchange received from overseas;
(o)
Supply of goods against free foreign exchange by a Free Trade and
Warehousing Zone Unit;
(a) Sum
total of the Cost Insurance and Freight value of all imported inputs used for
authorized operations during the relevant period and the Cost Insurance and
Freight value of all imported capital goods including goods purchased on high
seas basis even though paid for in Indian Rupees and the value of all payments
made in foreign exchange by way of export commission, royalty, fees,
dividends, interest on external commercial borrowings during the first five
year period or any other charges;
(b)
Value of goods obtained from other Unit or Export Oriented Unit or
(c) The
Cost Insurance Freight value of the goods and services, including prorata Cost
Insurance Freight of capital goods, imported duty free or leased from a
leasing company or received free of cost and or on loan basis or on transfer
for the period they remain with Unit;
5.
Sector specific requirements-Rule 18(3)
6.
Proposals not be considered- Rule 18(4)
7.
Conditions applicable to Free Trade and Warehousing
Zones - Rule 18(5)
8.
Conditions for services provided to overseas entities –Rule 18(6)
9.
Letter of Approval to a Unit-Rule 19
10. Validity period of Letter of
approval- Rule 19(4)
11. Lapse of Letter of
approval – Rule 19(5)
12.
Foreign Companies in Special Economic Zones
1. Application (Rule 17)
2. Content of Form F
includes
3. Consideration of
proposals for setting up of Unit in a Special Economic Zone. –Rule 18
4. General Requirements for
getting approval
(v)
Income tax returns -
B: consist of sum of the following:-