VSEZ || EOU Scheme http://www.vsez.gov.in/vsez_wsp__eou_schme.

aspx

Home | Mail | Logout

Home | Mail | Contact Us

ABOUT US SEZ EOU ADMINISTRATION INFRASTRUCTURE SOFTWARE STATUS OF CST/DBK INFORMATION CENTER RELATED LINKS

EOU Scheme

About 100% Export oriented unit scheme:

Introduced in the year 1981 by Govt. of India, the EOU Scheme's main thrust is to boost and attract sector specific exports from all parts of India having huge
potential near to raw material source. The Scheme has undergone several changes over a period and the present policy parameter is most liberalized and
conducive to the entrepreneur for setting up its Export Oriented Unit. The Scheme covers manufacturing/processing and services.

Objectives of the 100% Export oriented unit:

The main objectives of the scheme is to increase exports, earn foreign exchange to the country, transfer of latest technologies stimulate direct foreign
investment and to generate additional employment.

Facilities in the Scheme:

Can be setup anywhere in AP, Yanam & Chattisgarh

Minimum investment should be Rs.1 Crore in plant & machinery (except for Agriculture/Floriculture/Aquaculture/IT/Service units, Brass hand made jewelery)

Existing units in DTA can also convert into EOU Scheme and avail the IT benefits as per latest policy

EOU can be setup on leased premises also with minimum lease period of 5 years

EOUs are allowed to have additional locations for their operational convenience within the jurisdiction of Development Commissioner, VSEZ i.e., Andhra
Pradesh, Yanam & Chattisgarh

Units engaged in Business services, Computer and related services, R&D services, Real estate services, Communications services, Engineering services,
Educational services etc., can also be set up under EOU scheme availing all the benefits with the investment of below Rs. 1 Crore

Attractive Policy Provisions for EOUs :

EOU can also import second hand capital goods without any age limit

50% of physical exports can be sold in domestic market on payment of concessional duty

EOUs can process and export rice (Basmati & Non-Basmati)

EOUs including Gem & Jewellery units are permitted to sub-contract upto 50% of their production (or) production process in DTA / other EOUs

EOUs are allowed to utilize plant and machinery for job work DTA units provided the goods are exported directly from the EOU premises

EOUs in Agriculture and allied sectors and in granite sector may transfer the capital goods and the inputs to the Farms/field/quarries for usage relating to
the production in the EOU

1 of 3 30/11/2017, 7:58 AM
VSEZ || EOU Scheme http://www.vsez.gov.in/vsez_wsp__eou_schme.aspx

In case of new EOUs, Advance DTA sale will be allowed not exceeding 50% of its estimated exports for the first year except the pharmaceutical units where
this will be based on its estimated exports for the first two years

Simultaneous Advance DTA sale permission is given on quarterly basis for perishable goods like mushrooms, cut flowers etc.

Exports through third party is permitted

Exports from the job workers premises is allowed

100% FDI investment permitted through Automatic Route similar to SEZ units

EOUs can obtain Foreign currency loans from OBUs situated in the SEZs

EOUs have to achieve only positive Net Foreign Exchange (NFE) within 5 years i.e., A - B > 0 where (A) is the FOB value of Exports and (B) is CIF value of
imports

Fiscal Incentives available to 100% EOUs:

Exemption from Customs and Central Exciuse duties on import/local procurement of Capital goods, raw materials, consumables, spares, packing material
etc.

Reiumbursement of Central Sales Tax (CST) on purchases made from Domestic Tariff Area (DTA)

Corporate Tax Holiday upto 2010

CENVAT credit on Service Tax paid

Re-iumbursement of duty paid on fuels procured from domestic oil companies as per the rate of Drawback notified by the DGFT from time to time

Special Package of Incentives for Star Export House EOUs (Fast Track Clearance):

Permissions and Customs clearances for both Imports and Exports on self declaration basis

Fixation of Input-Output norms on priority within 60 days

Exemption from compulsory negotiation of documents through Banks

100% retention of foreign exchange in EEFC account

Enhancement of normal repatriation period from 180 days to 360 days

Exemption from furnishing of Bank Guarantee in Schemes under this policy

Exemption from examination of Import Cargo

Install one Fax machine & two computers in their Administrative/Registered Office on prior initiation only

Procurement of DG set intimation to the Development Commissioner/Jurisdictional Customs/Central Excise authority

Remove their Capital goods (or) part thereof for repairs under prior intimation to the jurisdictional Asst./Deputy Commissioner of Customs & Central Excise
authority

2 of 3 30/11/2017, 7:58 AM
VSEZ || EOU Scheme http://www.vsez.gov.in/vsez_wsp__eou_schme.aspx

Developed and Maintained by VSEZ.

Terms & Conditions | Disclaimer | Feedback | Sitemap | Hyperlinking Policy
The Visakhapatnam Special Economic Zone (VSEZ),
Ministry of Commerce & Industry, Govt. of India. All rights reserved.

3 of 3 30/11/2017, 7:58 AM