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All About Electronics Hardware Technology Park (EHTP) Scheme

EHTP is abbreviated form of Electronic Hardware Technology Park Scheme which is launched by the Ministry of Electronics and Information Technology, Government of India to encourage the entrepreneurs in establishing manufacturing units of the electronic hardware equipment. The EHTP scheme aims to promoting entrepreneurs in mounting Hardware Technology Parks anywhere in India for exporting their produced electronics goods. Various benefits and assistances are provided under the export-oriented scheme to increase the production & export of electronics goods and services.

What are the Objectives of the Electronics Hardware Technology Park Scheme?

The scheme targets on accomplishing the following objectives:

  1. To motivate entrepreneurs for establishing Electronic Hardware Technology Parks in India (EHTPI)
  2. To enhance the production and exportation of electronics goods and services
  3. To increase the revenue of the country with the capital investment from foreign entrepreneurs
  4. To generate more employment opportunities

What are the Benefits of the Scheme?

The Electronic Hardware Technology Park Scheme having these following features:

  1. The Central Government, State Government, Public or Private sector undertakings or an individual can establish the technology park in any part of India.
  2. The scheme encourages foreign investment and provides provision for 100% Foreign Equity investment through automatic route
  3. Capital goods, raw materials, components and other such goods can be procured and imported with Duty-free services under the scheme
  4. As per the provisions Under Income Tax Act- section 10A/10B, the eligible entrepreneurs can obtain the Income Tax exemption from the export profits.
  5. The EHTP units are discharged from the payment of corporate income tax for five years in the first eight years of its commercialization.
  6. The NFE (Net Foreign Exchange) acquired by the unit can be merged with the NFE of its head or associate company in the DTA (Domestic Traffic Area). It will advantageous for the parent or associate company in obtaining the Export House or Trading House or Star Trading House status.
  7. EHTP units can get 100% Foreign Equity benefits under the scheme.
  8. The units can import all the goods required for the manufacturing from bonded warehouses in the Domestic Tariff Area (DTA) for Duty-free under the Export-Import (EXIM) Policy.
  9. Entrepreneurs can claim Refundable Central Sales Tax for their units.
  10. DTA Sales, DTA sales permissible up to 50% of FOB value of exports, subject to fulfillment of positive NFE, on payment of concessional duties (50% of basic customs duty and full excise duty). DTA sales beyond this entitlement are permissible against payment of full duties provided the unit has achieved positive Net Foreign Exchange.
  11. Approvals are provided under the single window clearance system
  12. The project cost with the minimum value of100 million is approved speedily by the authorities.
  13. Outsourcing between EOU/STP/EHTP/EPZ is approved under the scheme.
  14. CST charges paid by the entrepreneurs can be reimbursed under the scheme.

Who are the Eligible Beneficiaries?

The kind of beneficiaries are eligible under the scheme are as follows:

  1. Micro, Small and Medium entrepreneurs with an aim to expand production and exportation of electronic goods and services
  2. Any public and private sector undertakings

What are the Membership Procedures?

To become a certified member unit under STP scheme, an individual need to take approval from the competent authority which is Director, STPI-Mumbai is required. Following documents are required for obtaining approval:                                                                                               

  1. Gist of application
  2. Application in triplicate
  3. Project report
  4. Board resolution
  5. Memorandum or Articles of association
  6. Export order / contract or MOU
  7. List of Directors
  8. Importer – Exporter code number
  9. Proof of STP location premises ( e.g. Leave and license)
  10. Valid data communication proof (e.g. Receipt of payment, service acceptance letter)

What Documents Required?

  1. The applicants must submit the following mandatory documents while applying for the benefits under the scheme,
  2. Application Form
  3. Detailed Project Report of the unit
  4. A copy of Board Resolution document
  5. Memorandum and/or Articles of Association
  6. Export Order or Memorandum of Understanding
  7. The name and other details of the Board of Directors
  8. Exporter and Importer code number
  9. Address proof of the Technology Park location.
  10. Verified data communication proof such as Payment receipt, Service acceptance report etc.

What is the Application Procedure?

The applicants can apply via both process with is automatic and manual registration to claim the benefits under the scheme. The eligible applicants can follow these below mention process to apply for the scheme:

  1. Application form duly filled & signed duly by the applicant need to be submitted to the Director of EHTPI. Each page of the application form must be stamped.
  2. A Demand Draft of INR 2,500 in favor of Director, EHTPI their respective jurisdiction of the unit need to be enclosed with the application form.
  3. The Detailed Project Report including the details of the promoter’s background, units’ area of expertise, services offered, marketing strategy and arrangements, manpower plan of the unit and other relevant documents should be provided.
  4. The Director verifies the application and documents. After that, acknowledges the receipt and provides a reference no.to each of the applicants.
  5. The applicants should demonstrate the presentation about their project in the EHTPI office and The Letter of Permission is offered to the applicant by the Director on the approval of the project.