ON WEST BENGAL   >  WB-IT Today   > Policy-Shaping A Digital State

• IT Department
• Elements of ITES Policy, 2002
• Special Incentives for IT Sector and IT Enabled Services
• Support for Investors
  
  

• IT DEPARTMENT

Based on the recommendations of the IT Task Force set up in March, 1999, West Bengal declared its IT Policy in January 2000 and set up an independent IT Department to act as the parent body for overall IT development in the state. The Department is headed at the ministerial level by the Minister and at the bureaucratic level by the IT Secretary.

To monitor and implement the policies outlined, the state Government is setting up a Cabinet Committee chaired by the Chief Minister. In addition, a committee of high-power state bureaucrats at the Secretary level will be chaired by the Chief Secretary to monitor implementation of projects and examine and approve applications for special incentives.

In addition to IT Policy, the State has also declared its ITES policy, details of which are as follows :

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Elements of ITES Policy, 2002, Government of West Bengal. Build on the State’s creative and intellectual wealth existing in the abundance of skilled and educated manpower, and focus on one or two areas of excellence for rapid growth. Stimulate the growth of IT enabled services and back office support services. Transit from an IT aware Government to an IT enabled Government by adopting e-Governance appropriately. Provide easily affordable infrastructure, and economic and other incentives, for progress in the ITES sector. Provide Public Utility Service status to ITES centres Exemption from laws governing working hours in establishments, zoning regulations and Consumption tax. Permission for self certification on various acts Address IT education and education in related spheres to : Produce adequate numbers of industry ready IT professionals in the State through public and private institutions. Develop IT culture in the State through IT literacy programmes. Promote institutions imparting specialized education in IT, Communications and Electronics. Promote setting up of IT Venture Fund companies.

The ITES policy also lays down the following for eligible units: -

• Can remain open for 24 hours working in three shifts every day of the year
• All ITES companies will be granted the status of Public Utility Service
• ITES units will be granted ‘establishment’ status under Shops & Establishments Act
  Women permitted to work at night
• Will be exempted from taking "No Objection Certificate" and "Consent to Operate" from West Bengal Pollution Control Board.
• Self certification permitted on various acts
• Exempt from zoning regulations
• Exempted from Consumption Tax

For Details of the above mentioned regulatory support and incentives click here.

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• Special Incentives for IT Sector and IT Enabled Services

The Government of West Bengal has announced a comprehensive package of fiscal incentives for the IT industry. For the purpose of determining the types and quantum of incenive available under the Scheme for approved projects according to their location, the State has been classified into three groups:

• Group A - Kolkata Municipal Corporation
• Group B - Howrah, Hoogly, North 24 Parganas excluding the area under the jurisdiction of the Kolkata Municipal Corporation. Also the districts of Burdwan, Midnapore and Nadia Districts
• Group C - Murshidabad, Birbhum, Purulia, Bankura, Malda, Cooch Behar, North Dinajpur, South Dinajpur, Jalpaiguri and Darjeeling Districts
  
  

  In terms of subsidies given, West Bengal's Incentive Scheme for IT Industry is the best amongst all the states in the country

  
  The Nature and Quantum of Incentives for eligible units set up on or after November 1, 2001 as per the New Incentive Scheme is given below:
  

TYPE OF SUBSIDY	GROUP A	GROUP A	GROUP A
State Capital Investment Subsidy	15% of fixed capital investment subject to a limit of Rs. 150 lakhs	15% of fixed capital investment subject to a limit of Rs. 150 lakhs	25% of fixed capital investment subject to a limit of Rs. 250 lakhs
Interest Subsidy	50% on annual interest liability on loan borrowed subject to ceiling of Rs. 100 lakhs per year for 5 years	60% on annual interest liability on loan borrowed subject to a ceiling of Rs. 120 lakhs per yearfor 7 years	60% on annual interest liability on loan borrowed subject to a ceiling of Rs. 120 lakhs per year for 9 years
Waiver of Electricity Duty	Waiver of electricity duty on electricity consumed for production/operation for period of 5 years from date of commercial production/ operation
Employment Generation Subsidy	Large & medium scale	Large & medium scale	Large & medium scale
	Reimbursement upto 50% of expenditure on ESI and EPF contribution for first 5 years	Reimbursement upto 50% of expenditure on ESI and EPF contribution for first 5 years	Reimbursement upto 50% of expenditure on ESI and EPF contribution for first 7 years
	Small scale:	Small scale:	Small scale:
	Reimbursement of 75% under same conditions	Reimbursement of 75% under same conditions	Reimbursement of 75% under same conditions
Remission of Stamp Duty and Registration Fee	Eligible IT unit (excluding IT enabled services) entitled to full exemption from payment of Stamp Duty and Registration Fee for purpose of registration of documents within the State relating to purchase/acquisition of land and buildings for setting up of approved project
Approved Expansion Project of Existing Unit	An existing IT unit for all its approved expansion, will be entitled to all the incentives mentioned in the above scheme subject to fulfillment of conditions prescribed for the respective item for a new unit
Subsidy for quality improvement in the small scale sector	Eligible unit in the Small Scale Sector shall be reimbursed 50% of expenditure up to a maximum of Rs. 5 lakhs for obtaining ISI certification/ ISO 9000 or SEI-CMM Level 5 or COPC-2000 or eSCM Level 3 from approved institutions/ Research Laboratories
Mega Projects	The State Government may consider granting a special package of incentives on a case-by-case basis under this scheme to a Mega Project requiring investment exceeding Rs 25 crores and employing more than 750 persons in the first year of operations, based on the pioneering nature of projects, location aspects, State of the Art technology, scope of further related investments etc.
Early Bird Incentive	Anchor investors will receive Mega Project status. ITES training schools will be subsidised. Captive generation equipment cost will be included as part of Fixed Capital Investment for subsidy calculation. Relax conditions for ITES companies to qualify for stamp duty exemption. Provide assistance on a case-by-case basis for specific investor requests, such as replacement of an unused incentive with a new one of equivalent fiscal impact.

No other state has declared annual employment and interest subsidies. Subsidy on the purchase of land is in addition to the above subsidies.

For the full IT Incentive Scheme click here.                                                  Top

• Support for Investors

To facilitate setting up operations in the state in general and Kolkata in particular, the Government has established the West Bengal Electronics Development Corporation (WEBEL) to act as a single window support centre for all IT investors in the State. WEBEL acts as the state’s nodal IT investor support agency and performs a variety of functions to facilitate investment in IT.

Among other tasks, WEBEL helps investors obtain building space and land for their establishments. It also interacts with Government Telecom bodies to procure last mile connectivity, the State electricity board for power connections and the local municipality for building and any other clearances and approvals required. They are authorised by the Government of India to grant registrations of IT companies in the Software Technology Parks of India (STPI) scheme.

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