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|June 2, 1997||
Software technology park to penalise defaulting exportersThe Hyderabad Software Technology Park is upset that some export-oriented units registered with it are not meeting the Department of Electronics' export obligation criteria while enjoying all the advantages of registration. Now penalties are being considered.
The penalty, to be decided upon by the Directorate General of Foreign Trade, would depend on the severity of the case, said a senior Hyderabad STP official. The unit would be fined, even closed down, he said, pointing out that these companies have been given enough time to get their act together.
A company registered with an STP can, without paying duty, import all kinds of goods, including capital goods. The STP units can also import capital goods on a loan from their client for a specific period for any project.
But 75 per cent of the software developed has to be exported, with 25 per cent reserved for the domestic tariff area.
So an STP unit is expected to export 1.5 times the CIF value on the hardware imported plus 1.5 times the wage bill, all in US dollars. The obligation on the hardware part is to be fulfilled over four years and the obligation on the wage bill is to fulfilled every year.
The STP gives companies a year to find their feet. Thereafter, they are expected to begin meeting their export regulations.
The Hyderabad STP plans to take action against the units that failed to meet these obligations. If hardware and software is brought into the country through a client's loan the STP planned no action as long as the software was to be re-exported. But the STP plans to look into the dealings of any company that wants to keep equipment three years after obtaining them.
- Compiled from the Indian media
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