Go global with FEPZ

The Falta Export Processing Zone was set up in 1984 under the administrative control of the Ministry of Commerce, Government of India. It is a multi-product export-processing zone in the Eastern and North-Eastern regions of India. It has access to a large and prosperous hinterland, extending to the states of West Bengal, Bihar, Orissa, Assam and the North-Eastern states. These states are endowed with vast mineral resources such as coal,iron ore, bauxite, petroleum, fire clay and limestone among others. Agricultural products such as jute and tea and marine products are also in abundance. It has an established industrial base comprising of steel, cement, fertilizer, heavy and light engineering products, leather, ceramic and glass industries and availability of skilled manpower. The zone is located in 280 acres of land on the Eastern bank of the river Hooghly.
Location
Based in Calcutta, the Falta Export Processing Zone is located in a pollution free environment at a distance of about 55 kilometres from the heart of Calcutta city and about 45 kilometres from the Southern suburbs. It is well connected by a developed network of roads including a State highway, two ports at Calcutta and Haldia and the International airport at Dumdum.

CHARACTERISTICS

Climate : Tropical

Temperature : 15 degree Celsius to 35 degree Celsius

Rainfall : 1700 mm

Relative Humidity : 50 per cent to 90 per cent

Ground Water Level : 0.90 metres to 2.25 metres

Water characteristics : pH value - 6.7 to 7.0

Chloride : 304.50 ppm to 336.75 ppm

Sulfate : 186.48 to 190.00

   Wind characteristics :
            Predominant South and South-East wind direction with wind speed not
            exceeding 40 kilometres an hour.

Infrastructural Facilities

Developed land and Built-up space at affordable and attractive rates.
Quality and Stable Power Supply
Telecommunications
Water supply
Container Handling Jetty
Facilitation and documentation services
Social Infrastructure
Others

Developed land and Built-up space at affordable and attractive rates:

Plots
Developed plots of various sizes are available in the zone to meet the requirements of industries, at a very nominal lease rent rate, which is Rupees 18 per square metre per annum. This is further subject to concessions during the first five years:

First year	:	75 percent
Second year	:	50 percent
Third year	:	25 percent
Fourth year	:	25 percent
Fifth year	:	25 percent

Industrial Shed
Limited space in the industrial shed is available

Lease rent: Rupees 185 per square metre per annum.

The tariff is subject to the following concessions:

First year	:	50 percent
Second year	:	40 percent
Third year	:	20 percent
Fourth year	:	20 percent
Fifth year	:	20 percent

Standard Design Factory Building (SDF)
Space in the SDF building is also available to accommodate sophisticated industries.

Lease rent: Rupees 300 per square metre per annum.

The tariff is subject to the following concessions:

First year	:	50 percent
Second year	:	40 percent
Third year	:	20 percent
Fourth year	:	20 percent
Fifth year	:	20 percent

Quality and stable power supply:

The West Bengal State Electricity Board assures uninterrupted power supply for industries to be set up in the zone through its 132KV service station within the zone itself.

Power tariff :

Rupees 1.38 to 2.88 per unit (basic rate for different categories of consumers). In addition there is also demand charge and fuel surcharges which are revised from time to time. There is however, a waiver of 20 percent to 40 percent on the basic electricity charges, granted for new industrial units of industries undertaking consumption above 50 HP.

Telecommunications:

There is an independent Electronic Telephone Exchange, with UHF link installed inside the zone.

Water supply:

24 hours water supply is ensured through a well-knit distribution system, within the zone. (Rs. 30.00 per 1000 KL)

Container Handling Jetty:

To facilitate smooth and quick movement of 20 feet and 40 feet containers, an independent Container Handling Jetty is operational near the zone.

Facilitation and documentation services:

The office of the Development Commissioner serves as the one-window office for all the units in the zone, including customs, security and the office of the Labour Commissioner of the Government of West Bengal, situated within the zone.
FEPZ is a veritable paradise for exporters. It’s administration offers a truly supportive environment by providing simplified procedures. This is especially so in the clearance of matter relating to industrial, approval, foreign collaborations etc., under a single-window clearance system.
The Development Commissioner is empowered to approve projects under an automatic approval scheme within no time with a view to ensure speedy implementation of projects.

Social Infrastructure:

With a view to facilitate all its employees and collaborators, FEPZ has a sound social infrastructure which includes, Housing facility, Medical services, a Market place, Fire service, Technical Training Institute, Bank, Post Office, Police Station and In-house security.

Others:

Apart from all the facilities mentioned above there are also:

Round-the-clock escort services from the Trade Promotional Bodies
Availability of trade related data and information within zone
Availability of semi-skilled/ unskilled work force, from the vicinity at a relatively lower rate
Above all Calcutta has an established industrial base comprising of steel, heavy and light engineering industries, and glass as well as ceramic industries. It is capable of supporting any developing industries

ENTITLEMENTS

Central Government Incentives:

Duty free import of capital goods, raw materials, components, consumer goods, packaging materials and spares required for exports
Fully-owned foreign companies allowed
No Income-Tax liability for 5 years
Exemption from Central Excise Duty for DTA purchase
Reimbursement of Central Sales Tax paid by the units
Clubbing of export (fob) with that of its parent companies in DTA for Export Houses
DTA sales 25 per cent (50 per cent in case of Agro based products) allowed
Concession Lease Rent for developed Plots and Built-up space in SDF buildings/industrial shed
Reprocessing, reconditioning, re-engineering
Private Bonded Warhousing, trading allowed in this zone

State Government Incentives
Incentive offered by the State Government for Small Scale Industries (Investment on Fixed Plant and Machinery up to Rupees three crores)

Investment subsidy of 15 per cent subject to a ceiling of Rupees 80,00,000
Waiver of Electricity Duty for five years from the commencement of the commercial production
Deferred payment of Sales Tax and remission of Sales Tax and remission of Sales Tax
Subsidy on the purchase of Captive Generating Set - 25 per cent of the cost
Subsidy on purchase of Transformer and drawing of Power Line - 20 per cent of the cost

Incentive offered by the State Government for Large and Medium Scale Industries (Investment above Rupees three crores)

Contribution by way of subsidy towards cost of feasibility study
25 per cent subsidy on purchase and installation of Captive Power Generating Set
Waiver of Electricity Duty
Capital investment subsidy up to 15 per cent of he fixed capital investment, subject to a ceiling of Rupees 15 lakhs
Deferment of Sales Tax/remission of Sales Tax for 7/5 years respectively subject to a ceiling of 70 per cent of the gross value of the fixed captial assets
Exemption from payment of Sales Tax for purchase of raw materials
Subsidised cost of power and incentives for consumption of power during off-peak hours

Promotional Bodies

West Bengal Industrial Development Corporation
   5, Council House Street
   Calcutta - 700 001
   Tel No. # 210 5361
The Director of Cottage and Small Industries Department Government of West Bengal
   New Secretariat Buildings
   Calcutta - 700 001
   Tel No. # 248 6271
Information Regarding Falta Export Processing Zone

Criteria for establishment of 100% EOUs
The mode and manner of grant of approval to projects
Location analysis and transport from International Airport and Seaports
Infrastructure Work, Status Plan etc
System of selling land
Conditions for sale
Architectural agreement/ agreement of the view
Environmental pollution and prevention agreement
System of allotment of space
Specification of SDF
System of preferential treatment of new companies
Tax Deduction etc
Steps for approval of projects
Other entitlements
Deemed Export Qualifying for discharge of export obligation
Abstract of the Current Status
Literacy

State Government attitude to Foreign Investment

Criteria for establishment of 100% EOUs
The units will have to export their entire production against freely convertible currencies and to General Currency Areas. However, exports to RPA are also allowed under certain conditions. Exports to Nepal and Bhutan against payment in Indian Rupee do not count towards discharge of Export Obligation.
Certain supplies in Domestic Tariff Area (DTA) (within the country) also qualify for discharge of Export Obligation against payment in Indian Rupees
Supplies in the DTA against payment in Foreign Exchange also qualify for discharge of Export Obligation
The units have to achieve a minimum export turnover of US $ 3.5 Million or 5 (five) times the value of capital goods, whichever is higher
The units have to achieve a minimum Value Addition as a percentage of exports as specified in the EXIM Policy. This generally varies between 7.5% for plain gold jewellery to 30% for computer software, textiles and garments, leather products, granite
The units are allowed to market 25% of their production in the Domestic Tariff Area if the exports made, the units achieve necessary Value Addition stipulated in the Letter of Approval

The Mode and Manner of Grant of Approval to Projects

Most of the projects fall under the Automatic Approval route and the approval is granted by the Development Commissioner
In a few cases, where the value of imported capital goods exceed Rs. 10 Crores or the item is otherwise covered by an Industrial License etc., the cases submitted to the Board of Approval. All approvals are granted in a time-bound manner

Location Analysis and Transport from International Airport and Seaports
Distance - 55 kilometres from the Central Business district of Calcutta, 45 kilometres from the Southern Suburbs of the city and 60 kilometres from Calcutta Port and 65 kilometres from the International Airport. The place is well connected by State Highway. There is a proposal for improvement of the State Highway from Calcutta up to the Zone. The Zone can also be accessed from the Haldia Port - 2 hours navigation from Falta.
Infrastructure Work, Status Plan etc:
Available:

30,000 square metres of built-up area in Standard Design Factory and Industrial Sheds (Occupancy 85%). About 150 acres of developed land available
Unrestricted and uninterrupted supply of power. Choice of dedicated power supply available to consumers as against supply from common grid. Power connections of construction purposes and up to about 50 HP for production purposes are given immediately
Water supply unrestricted: Rates Rs.2.50 per 1000 litres
Cost of Electricity: Approximately Rs.2.87 per unit (for bulk consumers, there is a 3% rebate on the basic charge) and also reduction in the tariff for consumption at night after 11 pm
Telecommunication Facilities including STD and ISD, VSNL link available, approval for release for telephone, given by this office (Development Commissioner, FEPZ)
Waste water: Waste water disposal and conveyance system in place. The units have to set up primary treatment facility within their premises and confirm to the standard of discharge set by the State Pollution Control Board for eventual evacuation into the waste water disposal and conveyance system
Jetty: For containers handling - capacity to load/unload @ 12 minutes/Container (TEU) with connection to Calcutta and Haldia

System of selling land
On the basis of approval of the project, lands are allotted on a 15 year lease, extended from time to time.
Conditions for sale
Long term lease granted Sub-lease, addition and alteration without the permission of the lessor (Office of the Development Commissioner) not permitted.
Architectural Specifications
Total built-up area not to exceed 2/3rd of the gross area, the vacant space being kept for greening and landscaping. Good house-keeping and good manufacturing practice necessary along with compliance with the statutory regulations regarding fire-hazards, hygiene, sanitary conditions and working conditions. In general, the overall architecture will have to be consistent with the vernacular architecture of the area.
Environmental pollution abatement arrangement
Primary treatment within the premises ensured by the unit concerns before release into the drainage system of the tone. Preference given for clean, non-polluting industries and industries handling, non-toxic and non-hazardous materials, as notified by the State Pollution Control Board. The units have to obtain preliminary ‘No Objection Certificate’ from the concerned State Pollution Control Board and later, the consent to discharge at the time of the commencement of the production and actual discharge of waste products.
System of allotment of space in SDF/Industrial Shed
SDF buildings are given on lease/rent basis and there is no outright sale.
Specification of SDF
Double storied structure, each Module about 600-700 square metres area with separate ingress and egress and provision for construction of service lift.
System of preferential treatment of new companies
Priority given for allocation of space/land to state-of-the-art industries with high value addition Net Foreign Exchange Earning and higher unit value of investment and production for export.
Tax Deduction etc
Under the current policy, all units in the Zone are entitled to tax holidays for 5 years in a block of 8 years. The units are entitled to duty free procurement of materials almost without any restrictions on imports and exports.
Steps for approval of projects

Development Commissioner, Falta EPZ, is competent to approve the project in Falta EPZ. The Automatic Approval route includes proposals with 100% foreign investment and involving External Commercial Borrowing (ECB). All other cases are to be submitted to the Board of Approval for consideration. All applications in 10(ten) copies in the prescribed format are to be submitted to the office of the Development Commissioner.
This office also provides escort assistance for securing other approvals and sanctions, from other regulatory authorities such as Inspectorate of Factories (for factory building and layout plan), Financial Institutions (for financial assistance) and Reserve Bank Of India (for completion of various formalities).

Other entitlements
DTA SALE
25% of the production value terms may be sold in the Domestic Tariff Area (DTA) subject to payment of applicable duties. However, for agriculture, Aquaculture, animal husbandry. Horticulture, Pisciculture, Poultry, viticulture and Sericulture, the DTA sale entitlement is 50% of the production in value terms. Separate provisions available in case of electronics hardware products and software products.
Deemed Export Qualifying for discharge of export obligation

Supplies effected in DTA in terms of the policy
Supplies effected in DTA against payment in Foreign Exchange.
Supplies of others EOU/EPZ/ EHTP/STP units provided that such goods are permissible for procurement in terms of the policy (Importability of goods by EOU/EPZ/STP/EHTP)

Abstract of the Current States

Communication : FEPZ connected by two State Highways - travelling time of about 90 minutes from the Central Business District of Calcutta and 60-75 minutes from the Southern Suburbs of the city. Jetty facility caters to direct handling of container cargo from Haldia and Calcutta. Facility for riverine passenger transport upto Falta is under consideration.
Wage Costs : Units set up in Falta EPZ are guided by the provisions of Labour Welfare legislations such as Minimum Wages Act. Industrial Disputes Act, Presently, the annual wage cost is about Rs. 15,000/- (US $ 350) per capita.
Workforce Skills : The area is located near the industrial location in the southern suburb of the city and skilled workforce is available in the vicinity. This includes both construction work as well as operation of units. Besides, a Community Polytechnic and Industrial Training Institute have been set up near the area for skill upgradation, on the job training, etc. The zone, as a whole, has been declared an Essential Service (Public Utility).
Market Access : Both the Export-Import Policy and the Operational Guidelines framed, provide for access to the domestic market linked to the export performance. Certain supplies by the units in the zone to the units in the domestic market also qualify for discharge of Export Obligation and are treated as Deemed Exports.
Foreign Investment : Presently, two units are operating with 100% Foreign Direct Investment from USA. Substantial foreign investment has also been made in 8 other projects. The foreign investment accounts for nearly 10% of the total investment in the Zone and is rising.
Property Cost : Land and premises in the Zone are allotted long term lease at affordable costs. Presently, the average cost of construction of facilities is about Rs. 3500 per sq. mtr. The service of competent construction agencies readily available at the site. The average property cost outside varies from location to location and depends on the facilities. On an average, the annual rent will be Rs. 300/- per sq. mtr. Per annum.

Literacy

The area is located close to the Metropolitan City with a high degree of literacy, formal and informal education, availability of facilities for education and considerable mobility of labour.
State Government attitude to Foreign Investment
The State Government of West Bengal has formulated a very liberal policy for attracting Foreign Investment in the desirable areas of high-tech products, areas requiring technology infusion and priority areas. The State Government provides an investor-friendly policy and ambience. Different offices of State Government relating to adjudication in industrial disputes, provision of services and utilities, extension services are already working in the Zone/from near the Zone.