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STP Done

The STP (Software Technology Park) scheme was announced by the Government of India to promote software exports. STP units are approved and administered through Software Technology Parks of India (STPI) which operates under the Ministry of Information Technology. The STP scheme provides several benefits to encourage software development for export such as 100% foreign equity permission, duty free imports, income tax exemptions, and deemed export benefits.

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71 views

STP Done

The STP (Software Technology Park) scheme was announced by the Government of India to promote software exports. STP units are approved and administered through Software Technology Parks of India (STPI) which operates under the Ministry of Information Technology. The STP scheme provides several benefits to encourage software development for export such as 100% foreign equity permission, duty free imports, income tax exemptions, and deemed export benefits.

Uploaded by

D Attitude Kid
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOC, PDF, TXT or read online on Scribd
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STP Scheme

Government of India has declared software as one of the extreme focus area for growth of
exports. Therefore, Govt. of India announced a special scheme to promote software exports
called "The Software Technology Park (STP) Scheme".

STP Scheme is implemented through Software Technology Parks of India (STPI) which is an
autonomous society of Ministry of Information Technology, Govt. of India.

Salient Features of STP Scheme

 Approvals are given under Single Window Clearance Mechanism


 100% Foreign Equity is permitted
 All the imports in the STP units are completely duty free
 Import of Goods on loan, free of cost & lease basis is permitted
 Re-export of Capital Goods brought on loan/lease/free of cost is permitted
 Domestic purchases are completely excise duty free
 Domestic purchases are eligible for the benefit of deemed exports to the suppliers
 The sales in Domestic Tariff Area (DTA) are permissible upto 50% of the value of
Exports
 STP units are exempted from corporate income tax upto Year 2010.
 The Export Obligation on the STP units is as follows

APPLICATION FOR SETTING UP UNITS UNDER STP SCHEME

Instructions:

Application should be filed alongwith following enclosures :

1. Demand Draft for Rs. 2,500/- in favour of `Software Technology Parks of India' payable
at Chandigarh.
2. Memorandum & Articles of Association in case of a company, Partnership Deed in case
of Partnership or IT Assessment in case of Proprietorship concern.
3. Director's/ Promoter's/ Partner's/ Proprietor's Profile.
4. Project Report with objective, profile, scope, marketing, infrastructure, employment,
schedule & current status and investment & turnover of the company.

Note : The application should be duly signed by the competent authority with initials on each
page of the application alongwith office seal of the company.
STP/EHTP units

Software Technology Park (STP) - STP is set up for development of software exports. The concept is
similar to concept of EOU/SEZ and provisions in respect of EOU discussed earlier are applicable to STP
also.

STP/EHTP scheme is administered by Ministry of Information Technology.

An STP/EHTP unit may be a stand alone unit by itself (like EOU) or it may be one of such units located in
area designated as STP/EHTP Complex. Thus, it is not essential that STP unit must be located in
designated STP/EHTP complex itself.

Note that a software development unit can be registered either as a STP unit or EHTP unit.

The units in STP/EHTP can import their inputs and capital goods (except goods in prohibited list of
imports) without payment of customs duty.

Goods in negative list can also be imported.

They can also import goods on loan from clients for specific period.

These units can export software through data communication channel or through physical transport.
Exports of professional services are also included.

These units are in a duty free custom bonded area.

The unit can carry out * development of computer software * data entry and conversion * data processing
* data analysis and control * data management * Call centre services.

They can also provide consultancy services. The consultancy fees received in free foreign exchange will
also be considered as exports for fulfilment of export obligation.

STPs can be set up by Government, private sector or public sector.

Units in STPs can use computer system for commercial training also.

They can import goods on loan from client for a specified period.

The units in STPs have to export their products, but 25% of production in value terms can be sold in
domestic tariff area. Such sale can be through data communication link or telecommunication link, subject
to prescribed conditions.

Sale within India to DTA against payment in foreign exchange is permissible. In such cases, such sale is
considered towards fulfilment of export obligation. The unit must have 'Net Foreign Exchange Earning as
a percentage of exports' (NEEP) of minimum 10%.

These units can have 100% foreign equity participation.

Such parks have been developed at Bangalore, Pune, Jaipur, New Mumbai, Noida, Gandhinagar,
Bhubaneshwar, Hyderabad and Thiruvanthapuram.

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