North East BPO Promotion Scheme (NEBPS)

The North East BPO Promotion Scheme (NEBPS), launched under Digital India Programme, seeks to create employment opportunities for around 15,000 individuals. The scheme offers financial support and special incentives such as training incentive, an incentive for diversity and inclusion, an incentive for providing employment beyond target and incentive for promoting local entrepreneur. Let us look at the various aspects of NEBPS in this article.

Objectives

Given below are the objectives of the North East BPO Promotion Scheme:

To create employment opportunities for local youth in NER by promoting IT/ITES industry by setting up BPO/ITES operations.
Promote investment in IT/ITES sector in NER to expand the base of IT industry and have a secured and balanced regional growth.

Location

NEBPS would be implemented in eight North Eastern States that includes Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim and Tripura.

Implementing Agency

The NEBPS would be implemented by the Software Technology Parks of India (STPI) which is an autonomous society of the Ministry of Electronics and Information Technology (MeitY).

Documents Required

Here are the documents required for NEBPS:

Eligibility Criteria

Given below list are the requirements that have to be fulfilled by the bidder:

The bidder has to be registered in India under The Companies Act, 1956 or The Companies Act 2013, whichever is applicable.
The bidder has to establish BPO/ITES operations at least with a minimum of 50 seat capacity in one location, which can be in a city or a town. However, the bidder can opt to quote for a maximum of 1500 seats either at one location or at multiple locations in the NER.
The bidder must be obligated to operate for a minimum of three years.
The bidder has to provide an undertaking to take either appropriate premises on lease for at least three years to produce a proof of ownership of the premises to establish BPO/ITES operations.
The bidder must have achieved a minimum average annual turnover during the last three financial years, as per the total number of seats that are applied under NEBPS.

The details are as follows:

Number of Seats/Bidder	The Minimum Average Annual Turnover of last three Financial Years (in Crore)
50	1
51-100	2
101-500	5
501-1000	10
1001-1500	15

In order to promote newly established companies/entrepreneur, the average annual turnover criteria can be considered from last three years to one completely audited financial year, provided 100% Bank Guarantee is deposited against the disbursement of financial support.

The bidder has to be obliged to employ at least 1.5 times the number of seats (employment target) for three years, for which the bid is submitted, and the claim for financial support would be made following the commencement of BPO/ITES operations.
The bidder must have a positive net worth as on 31.03.2017 or last audited Financial Year that has to be duly certified by a Chartered Accountant.
The bidder must not be under a Declaration of Ineligibility for corrupt of fraudulent practises or blacklisted by any Government agencies. Self-declaration has to be given by authorized signatory.

Exceptions

An entity that is registered under Companies Act but does not fulfil the financial criteria can form a Consortium and commit to maintaining a minimum equity shareholder (26%) for at least three years from the commencement date of BPO/ITES operations.
An entrepreneur or a Society can form a Consortium with an Indian company that fulfils the financial eligibility criteria and other conditions. The eligible Indian Company must at least have 26% equity shareholder in the Consortium and has to be obliged to maintain a minimum equity shareholding (26%) for at least three years from the commencement date of BPO/ITES operations. The eligible Indian Company that fulfils the given financial criteria would be considered as the lead member of the Consortium or the bidder.
Any entity that is registered under the Companies Act but unable to meet the financial criteria or a Society of a Proprietary Firm can form a Consortium with an Indian Company that is registered under The Companies Act. However, it is subjected to furnishing 100% Bank Guarantee and limited to only up to 100 seat operations. The registered Indian Company must have at least 26% equity shareholder in the Consortium and is obliged to maintain a minimum equity shareholding for at least three years from the commencement of BPO/ITES operations.

Application Process

The companies willing to apply for NEBPS has to submit its bid in Two-Bid Format according to RFP, including Bid security Deposit that has to be sealed separately. The Bidder has to put these three sealed envelopes in a big envelope that is duly sealed and send it to the STPI-HQ by or before the given due date.

Disbursement of Financial Support

Financial support would be released in three yearly instalments, provided the following documents have to be possessed.

Aadhaar number of the regular employees recruited/joined the unit after the issuance of In principle Approval (IPA).
PAN of regular employees recruited/joined the unit after issuing IPA.
Provident Fund account number and Aadhaar linked Universal Account Number (UAN) regular employees recruited/joined the unit after issuing IPA.
Proof of ESI contribution of the regular employees recruited/joined the unit after issuing IPA.
Proof of State Professional Tax.
Certificate of Disability that is issued by a Medical Authority.
Other relevant documents.

First Installment

The first instalment would be up to 40% of the total eligible VGF, that has to be calculated on pro-rata basis, subjected to a minimum of 50% of employment target from the commencement of operation. The funds can be claimed any time after one year from the commencement of operation, but not later than 15 months from its commencement.

Second Installment

The second instalment would be up to 70% of the total eligible VGF, that has to be calculated on pro-rata basis, subjected to a minimum of 50% of employment target from the commencement of operation. The funds can be claimed any time after twenty-four months from the commencement of operation, but not later than twenty-four months from the commencement of operation.

Third Installment

The second instalment shall be up to 100% of the total eligible VGF, that has to be calculated on pro-rata basis, subjected to a minimum of 50% of employment target from the commencement of operation. The funds can be claimed any time after thirty-six months from the commencement of operation, but not later than thirty-seven months from the commencement of operation.