The North East BPO Promotion Scheme (NEBPS), envisaged under Digital India Programme , seeks to incentivize establishment of 5,000 seats in respect of BPO/ITES operations in North East Region (NER), at an outlay of ₹ 50 Crore up to 31.03.2019, thus creating employment opportunities for about 15,000 persons considering three shifts BPO/ITES operations. NEBPS provides the following financial supports with overall ceiling of ₹ 1 Lakh/seat in the form of Viability Gap Funding (VGF) to eligible Companies based on performance, i.e. generation of new employment and new economic activity in IT/ITES sector, in the North Eastern Region (NER) through BPO/ITES operations:

(a) Financial Support: Up to 50% of expenditure incurred on BPO/ITES operations towards capital expenditure (CAPEX) and/or operational expenditure (OPEX) on admissible items as per Annexure-I, subject to an upper ceiling of ₹ 1 Lakh/Seat.

(b) Special Incentives: The following special incentives will be provided within the ceiling of total financial support i.e. ₹ 1 Lakh/seat:

1. Training Incentive: Up to 50% of training expenditure with cap of ₹ 6,000/employee for total regular employees up to the 1.5 times (employment target) the number of approved seats of BPO/ITES operation (e.g. For 100 seats BPO/ITES operation, training incentive can be availed for max. 1.5 X 100 = 150 regular employees).

2. Incentive for diversity & inclusion: Special incentive (% of eligible financial support) for Units providing employment to women and persons with disability will be provided as under:

   Inclusion & Diversity	Special Incentive (% of eligible capital support)
   50% women employment	5%
   75% women employment	7.5%
   4% employment for persons with disability	2%

3. Incentive for providing employment beyond target: Special incentive (% of eligible capital support) for units providing employment beyond employment target (1.5 times the number of seats) will be provided as under:

   Employment generation	Special Incentive (% of eligible capital support)
   2 X no. of seats	5%
   2.5 X no. of seats	7.5%
   3 X no. of seats	10%

4. Incentive for promoting local entrepreneur: Special Incentive (5% of eligible financial support) for units setting up BPO/ITES operations as a consortium with local entrepreneur (Domicile of the State where BPO/ITES operations are being established).

(c) Under the NEBPS, the quantum of financial support shall be determined through an open bid system, subject to overall ceiling Rs. 1 lakh/seat. The bids would be invited from eligible companies in each State in the N.E.R, through a Request For Proposal (RFP), to determine the lowest amount of financial Support to be provided as Viability Gap Funding.

(d) A Company, seeking to avail financial support under this scheme, shall be under obligation not to claim the similar financial support from any other Scheme of the Central/State Government concerned. However, other supports not claimed under NEBPS may be availed from other Scheme of the Central/State Government.

The objectives of NEBPS are as under:

(i) Creation of employment opportunities for the local youth in NER, by promoting the IT/ITES Industry particularly by setting up the BPO/ITES operations.

(ii) Promotion of investment in IT/ITES Sector in NER in order to expand the base of IT Industry and secure balanced regional growth.

The duration of NEBPS is up to 31.03.2020. The prospective units can apply under NEBPS up to 31.03.2020, subject to availability of seats. However, considering disbursement schedule of the scheme, disbursement may go beyond 31.03.2020.

The NEBPS is to be implemented in all the eight (8) States of NER viz. Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, and Tripura.

The Software Technology Parks of India (STPI), an autonomous society of Ministry of Electronics & Information Technology (MeitY), is the implementing Agency of NEBPS.

The bidder would be required to meet the following conditions:

(i) The bidder should be registered in India under The Companies Act, 1956 or The Companies Act 2013 (as amended till date), as applicable.

(ii) The bidder must be willing to set up BPO/ITES operations, with a minimum of 50 seats capacity at one location (city/town). However the bidder would be at liberty to quote for a maximum of 1500 seats either (a) at one location (city/town) or (b) at multiple locations (city/town) in the NER.

(iii) The bidder must commit to operate for a minimum period of 3 years.

(iv) (iv) The bidder must furnish an undertaking to take either appropriate premises on lease for at least 3 years or produce the proof of ownership of the premises for setting up BPO/ITES operations at the location referred at (ii) above. [Minimum 4000 Sq. Ft. super area including utilities etc. for 100 seats i.e. @ 40 Sq Ft per seat].

(v) The bidder should have achieved a minimum average annual turnover during last 3* financial years, as per total number of seats applied under NEBPS, detailed as follows:

 

Number of seats/bidder	Minimum Average Annual Turnover of last 3 FYs (Rs. in Crore)
50	1
51-100	2
101-500	5
501-1000	10
1001-1500	15

*To promote newly set up companies/entrepreneur, the average annual turnover criteria is relaxed from last 3 years to 1 completed audited financial year, with a condition that 100% Bank Guarantee is deposited against the disbursements of financial support.

OR

An Entity registered under Companies Act but not able to meet above financial criteria, can form a Consortium with an Indian Company which is able to fulfill above financial eligibility criteria and other conditions. The eligible Indian Company must have at least 26 % equity shareholder in the Consortium and commit to maintain minimum equity shareholding (26%) for at least three years from date of commencement of BPO/ITES operations. The eligible Indian company of the consortium will be considered as bidder and fulfill all the eligibility conditions including turnover criteria and positive net worth.

OR

An entrepreneur or a Society (registered under Societies Registration Act, 1860 or State Society Registration Act) can form a Consortium with an Indian Company which is able to fulfill above financial eligibility criteria and other conditions. The eligible Indian Company must have at least 26 % equity shareholder in the Consortium and commit to maintain minimum equity shareholding (26%) for at least three years from date of commencement of BPO/ITES operations. The eligible Indian Company able to meet above financial criteria shall be the lead member of the Consortium or the bidder. (Criteria of Turnover and positive net worth of the eligible Indian company will be considered.)

OR

An Entity registered under Companies Act but not able to meet above financial criteria or a Society (registered under Societies Registration Act, 1860 or State Society Registration Act) or a Proprietary firm can form a Consortium with an Indian Company registered under Companies Act 1956/2013 fulfilling the above financial eligibility criteria together, subject to furnishing 100% Bank Guarantee and limited up to 100 seats operations only. However, registered company under Companies Act 1956/2013 will be the prime bidder fulfilling all other terms & conditions. The registered Indian Company must have at least 26% equity shareholder in the Consortium and commit to maintain minimum equity shareholding (26%) for at least three years from date of commencement of BPO/ITES operations.

Note: In case of consortium, the eligible company will be considered as the "bidder" (all policy criteria under North East BPO Promotion Scheme (NEBPS) shall be applicable with this company name). After winning the bid, successful bidder may form Special Purpose Vehicle (SPV) registered under Companies Act 2013 for the purpose inter-alia including implementation of NEBPS, In such case, the successful bidder would pass Rights and Obligations coming out of bid to SPV. In case SPV is formed, another Master Service Agreement would be signed with SPV to fulfill the terms & conditions of the bidder including fulfillment of employment target, claiming financial support, special incentives etc.
In case of single bidder, SPV formation is not allowed.

(vi) The bidder must commit itself to employ at least 1.5 times the number of seats (employment target) for period of 3 years, for which the bid is submitted and claim for financial support is to be subsequently made, after the commencement of BPO/ITES operations.

(vii)The bidder should have positive net worth as on 31-03-17 or last audited Financial Year, duly certified by a Chartered Accountant.

(viii) The bidder should not be under a Declaration of Ineligibility for corrupt or fraudulent practices or blacklisted by any of the Government agencies. Self-Declaration should be given by authorized signatory.

The STPI will invite Bids from the eligible companies through Request for Proposal (RFP), who are desirous of setting up BPO/ITES operations in N.E. Region.

A. Application Process:

    (i) The companies interested in NEBPS would required to submit its bid in Two-Bid Format as per RFP, viz. Technical and Financial Bids, along with Bid security Deposit [Bid Security Deposit would be ₹ 5000/Seat] sealed separately. The Bidder would be required to put these three sealed envelopes (Technical Bid, Financial Bid and Bid security) in a big envelope duly sealed and send it to the STPI-HQ by or before the Due Date.

    (ii) In order to allow flexibility to the bidder to choose any location across NER based on business needs and ensure dispersal among bidders comparing their scale of operations, seats across NER has been categorized in Seat Slabs, detailed as under:

Seats Slab (SS) in NER	Number of Seats in a Slab	Minimum Average Annual Turnover of last 3 FYs (₹ in Crore)
SS0	50	1
SS1	51-100	2
SS2	101-200	5
SS3	201-400	5
SS4	401-500	5
SS5	501-1000	10
SS6	1001-1500	15

    (iii) Bidder will give one bid in one Seat-Slab only, subject to fulfilling turnover criteria and other terms and conditions.

B. Evaluation Process:

(i) The bids received by the Bid Submission End Date shall be opened by a duly Constituted Committee in the presence of the bidder(s) or their authorized representative(s), who may opt to be present. At this stage, the main Big envelope containing three sealed envelopes of Technical Bid, Financial Bid and Bid Security would be opened. Consequently, the envelope containing the technical bid will be opened. Further, the envelopes containing the Financial bid and Bid Security will be kept securely without opening, after being duly signed by the Committee on the body of the envelopes.

(ii) Consequently, a duly constituted Technical Evaluation Committee will proceed to evaluate the technical bids. Based on this evaluation, technically qualified bidders would be invited to the opening of Financial Bids on a subsequent date. The Financial Bids will be opened by a duly constituted Financial Evaluation Committee in the presence of the bidder(s) or their authorized representative(s), who may opt to be present.

(iii) The financial bids of the eligible bidders shall be evaluated as per the following approach:

        (a) The bids under NEBPS will be evaluated in a Round Robin manner as per Seat Slabs.

        (b) Bidder will give one bid in one Seat-Slab only, subject to fulfilling turnover criteria and other terms and conditions. However, bidder may choose to setup BPO/ITES operations at a particular location or multiple locations within the NER (minimum 50 seats at one location).

    e.g. For 300 seats bid @ ₹ 80,000/Seat the bidder may set up either 300 Seats BPO unit at one location or 100 Seats BPO unit in 3 different locations. The agreement and subsequent disbursement will be made separately for each location.

        (c) The lowest bidders (L1) for all Seat Slabs will be determined. Then the bidder claiming the lowest among all Seat Slabs will be declared successful first. Subsequently, the lowest bidder in ascending order from the other Seat Slab in NER will be declared successful in a Round Robin manner.

     Example of Round Robin Bidding Methodology

Seat Slab	Bid amount in ascending order			Winner (L1)
SS1	S11(Rs. 80K)	S12(Rs. 82K)	S13(Rs. 84K)	S11
SS2	S21(Rs. 75K)	S22(Rs. 78K)	S23(Rs. 80K)	S21
SS3	S31(Rs. 70K)	S32(Rs. 72K)	S33(Rs. 74K)	S31

Order of winning S31, S21, S11 even if S22 < S11

        (d)If two or more bidders in a Seat Slab (L1 & L2 or L2 & L3 and so on) bid the same amount, then bidder quoting lesser number of seats will be considered first for ensuring wider dispersal. In case numbers of seats are also same for two or more bidders in a Seat Slab, then the bidder with higher net worth will be considered first.

        (e) After completion of one round across Seat Slabs, the second lowest bidder(s) and other bidders of each Seat Slab in the same sequence as determined in first round would be asked to match the lowest bid for capital support for the respective seat-slab and on its acceptance such bids would be treated as successful bids, subject to availability of seats.

(iv) The Successful Bidders will be conveyed In-Principle Approval (IPA) by STPI, enabling it to take consequential steps for starting BPO/ITES operations. These Successful Bidders would be required to enter into an Agreement with the STPI-HQ/STPI Guwahati, within a period of two weeks from the date of issue of the above In-Principle Approval.

Disbursement of Financial Support:

The BPO Unit can request for release of advance of 10% of approved financial support after verification of COO(Commencement of Operation) by STPI, subject to furnishing Bank Guarantee of 10 % of approved financial support as per IPA valid for 3 years from commencement of operation and its verification by STPI. The eligible support as per the agreed amount shall be released in 3 yearly instalments, subject to fulfilment of all formalities and compliance with various conditions laid down in this scheme and submission of following documents:

(a) Aadhaar number of regular employees recruited/joined the unit after the issuance of In Principle Approval (IPA).
(b) PAN of regular employees recruited/joined the unit after the issuance of In-Principle Approval (IPA).
(c) Provident fund account number and Aadhaar linked Universal Account Number (UAN) for the regular employees recruited/joined the unit after the issuance of In Principle Approval (IPA).
(d) Proof of Employee State Insurance (ESI) contribution for the regular employees eligible under this scheme and recruited/joined the unit after the issuance of IPA.

(e) Proof of State Professional Tax, wherever applicable.
(f) Certificate of Disability issued by a Medical Authority (Notified by the State Govt.).
(g) Any other relevant documents.

The first installmentshall be up to 40% of the total eligible VGF, to be calculated on pro-rata basis, subject to at least 50% of employment target from commencement of operation and further subject to verification of required proofs/documents and site inspection by STPI. This instalment shall be claimed any time after one year from commencement of operation but not later than fifteen months from commencement of operation.

The Second installmentshall be up to 70% of total eligible VGF, to be calculated on pro-rata basis, subject to meeting at least 50% of employment target from commencement of operation and further subject to verification of required proofs/documents and site inspection by STPI. This instalment shall be claimed any time after twenty four months from commencement of operation, but not later than twenty seven months from commencement of operation.

The Third installmentshall be up to 100% of total eligible VGF, to be calculated on pro-rata basis, subject to meeting at least 50% of employment target from commencement of operation and further subject to verification of required proofs/documents and site inspection by STPI. This instalment shall be claimed any time after thirty six months from commencement of operation, but not later than thirty seven months from commencement of operation.

Procedure to calculate employment target for disbursement of financial support: Average monthly employment for the duration from commencement of operation till the time of request for release of financial support will be considered to calculate the eligible financial support for each instalment.

e.g. Assuming the estimated per seat expenditure for setting up BPO/ITES operations is Rs. 1,60,000/seat then the bid amount of the Unit shall be Rs. 80,000/seat. If the unit wins the bid for 100 seats BPO/ITES operation @ ₹ 80,000/seat and the actual expenditure by the unit is Rs. 1, 60,000/seat or more, then the disbursement of financial support in different scenarios will be as under:

 

S. No.	Achieved average monthly Employment Target (E.T.) at the time of claiming 1st instalment from commencement of operation	Disbursed amount of financial support in 1st instalment (X% of E.T. * 40% of Total financial support - advance amount )	Achieved average monthly Employment Target (E.T.) at the time of claiming 2nd instalment from commencement of operation	Disbursed amount of financial support in 2nd instalment (remarks) [(X% of E.T. * 70% of Total financial support) – disbursed amount till 1st instalment]	Achieved average monthly Employment Target (E.T.) at the time of claiming 3rd instalment from commencement of operation	Disbursed amount of financial support in 3rd instalment (remarks) [(X% of E.T. * Total financial support) – (disbursed amount till 2nd instalment]
I	90% (135 persons against E.T. of 150)	₹ 20.8 Lakh [₹ 28.8Lakh – ₹ 8 Lakh]	80% (120 persons against E.T. of 150)	₹ 16 Lakh [₹ 44.8Lakh – ₹ 28.8 Lakh]	70% (105 persons against the target of 150)	₹ 11.2 Lakh [₹ 56Lakh – (₹ 28.8 Lakh+₹ 16 Lakh)]
II	90% (135 persons against E.T. of 150)	₹ 20.8 Lakh [₹ 28.8Lakh – ₹ 8 Lakh]	90% (135 persons against E.T. of 150)	₹ 21.6 Lakh [₹ 50.4Lakh – ₹ 28.8 Lakh]	90% (135 persons against E.T. of 150)	₹ 21.6 Lakh [₹ 72Lakh – (₹ 28.8 Lakh+₹ 21.6 Lakh)]
III	60% (90 persons against E.T. of 150)	₹ 11.2 Lakh [₹ 19.2Lakh – ₹ 8 Lakh]	90% (135 persons against E.T. of 150)	₹ 31.2Lakh [₹ 50.4 lakh - ₹ 19.2 Lakh )	80% (120 persons against E.T. of 150)	₹ 13.6 Lakh [₹ 64 lakh – (₹ 19.2 Lakh + (₹ 31.2 Lakh )
IV	60% (90 persons against E.T. of 150)	₹ 11.2 Lakh [₹ 19.2Lakh – ₹ 8 Lakh]	90% (135 persons against E.T. of 150)	₹ 31.2Lakh [₹ 50.4 lakh - ₹ 19.2 Lakh )	100% (150 persons against E.T. of 150)	₹ 29.6 Lakh [₹ 80 lakh – (₹ 19.2 Lakh + (₹ 31.2 Lakh )

Disbursement of Special Incentives:

The special incentives is to be provided with/after the disbursement of 1st instalment of VGF on production of documentary proofs of employment as per Para 8(iii) above, subject to fulfilment of other terms and conditions:

(a) Incentive for diversity & inclusion: This incentive will be provided on subject to fulfilment of at least 50% of employment target.

(b) Incentive for providing employment beyond targetThis incentive will be provided to the units providing employment beyond employment target i.e. 1.5 times the number of seats as stated above.

(c) Incentive for wider dispersal within State including rural areas.

(d) Incentive for promoting local entrepreneur.

Sl. No	Activity/Milestone	Time Periods
1	Award of In-Principle Approval (IPA) to the successful bidder	T0
2	Signing of Master Service Agreement (MSA)	T1 : T0 to T0+02 weeks
3	Commencement of BPO/ITES operations	T2: T0 to T0 + 06 months T2: T0 to T0 + 09 months [with penalty as per Para 8(i)]
4	Report to STPI about commencement of operation (COO)	T3 : T2 to T2 + 02 weeks
5	Verification of COO by STPI	T4: T3 + 02 weeks
6	Grant of advance	T5: T4 + 04 weeks, after furnishing Bank Guarantee for 10% of eligible bid amount and its verification by STPI.
7	Release of Bid Security Deposit (BSD)/Earnest Money Deposit (EMD)	T6: T5
8	Request for release of VGF1 and special incentives	T7 : T2 + 1 year to T2+ 1 year and 3 months
9	Request for release of VGF2	T8 : T2 + 2 year to T2+ 2 year and 3 months
10	Request for release of VGF3	T9 : T2 + 3 year to T2+ 3 year and 1 months
11	Release of BG	On disbursement of VGF3

List of Units accepted In-Principle Approval (IPA) to setup BPO/ITES operations under North East BPO Promotion Scheme (NEBPS)

State	Company Name	City/Location	No of Seats
Arunachal Pradesh	B4B IT Solutions Pvt. Ltd.	Itanagar	50
Total	1 unit	1 location	50 seats
Assam	IKF Technologies Ltd.	Guwahati	100
	Thredz Information Technology Pvt. Ltd.	Guwahati	50
	Aduro Trading & Associates Pvt. Ltd.	Jorhat	50
	Tatwa Technologies Ltd	Guwahati	150
	Tatwa Technologies Ltd	Guwahati	50
	Madhav Mukund Trading Co. Pvt. Ltd.	Guwahati	60
	Madhav Mukund Trading Co. Pvt. Ltd.	Kaliabor/Nowgaon	50
	Pecon Software Ltd.	Guwahati	350
	Anjaybee Infotech Private Limited	Diphu	50
	Anjaybee Infotech Private Limited	Majuli	50
	Anjaybee Infotech Private Limited	Kokrajhar	50
	Anjaybee Infotech Private Limited	Nagaon	50
	Anjaybee Infotech Private Limited	Silchar	50
Total	13 units	8 locations	1110 seats
Manipur	UNI TRANS Solution Pvt. Ltd.	Imphal	100
	CubeTen Technologies Pvt. Ltd.	Imphal	50
	R K Marvin Communication Pvt Ltd	Imphal	100
Total	3 units	1 location	250 seats
Meghalaya	Vision India Services Pvt. Ltd.	Shillong	200
Total	1 unit	1 location	200 seats
Nagaland	Infinity Infomatic Pvt. Ltd.	Kohima	400
	Clairvoyance Technologies Private Limited	Dimapur	50
Total	2 units	2 location	450 seats
Grand Total	20 units	13 locations	2060 seats

S. No.	Item Description
1	Servers with OS
2	Software and Hardware per license cost for BPO/ITES operations
3	Networking Equipments (Switches, Routers, Firewalls, Voice/Video Conferencing Gateways)
4	Workstations (Desktop, Laptop, Tablets, IP phones, Headsets)
5	Data Storage
6	Structured Cabling
7	UPS
8	Printer, Copier, Scanner & Projector
9	Refrigerator & Water Purifier
10	Fire & Security Items
11	Computer Furniture
12	Electrical wiring & fittings
13	Central Air-conditioning equipment, air-conditioning System
14	Captive Diesel Generating Set and transformer of capacity commensurate with the actual requirement of the unit , solar power / Non conventional Energy Generation Set (OPTIONAL)*
15	Fax Machine
16	Private automatic branch exchange
17	Data Communication Equipment, Modem & VSA
18	Other misc. goods not exceeding 5 % of the total cost of above items including Tools, kits and spares

* The unit may avail incentive on Generating Set from the State Govt., if needed.

Note: Any item not covered above shall be decided by and permitted by NEBPS Management Committee (NMC).

• Consolidated Administrative Approval of NEBPS.9.30 MB
• Request For Proposal (RFP) document of NEBPS.650 KB
• Master Service Agreement (MSA).279 KB
• Format for Claiming Capital Support.253 KB
• Format for Quarterly Performance Report.132 KB

Efforts made by DeitY in co-operation with STPI and State IT Departments of NER, for promotion and wider publicity of NEBPS:

1. A seminar titled “Opportunity for IT Services in the North East – Issues and Way Forward”focusing NEBPS was conducted on 29^th Jan 2016 at Guwahati.
2. Workshop on NEBPS was conducted in Shillong on 30^th Jan 2016.
3. Workshop on NEBPS was conducted in Aizawal on 1^st Feb 2016.
4. A “Business Session on IT” focusing NEBPS, was conducted on 12^th Feb 2016 during “Destination- North East 2016” a event organized by Ministry of Development of North Ease Region (M/o DoNER) at New Delhi.
5. Exhibition Stall was set up on NEBPS by STPI, during “Destination- North East 2016” a event organized by Ministry of Development of North Ease Region (M/o DoNER) on 12^th -14^th Feb 2016 at New Delhi.

Q.1 Does BPO operations also include IT Enabled Services (ITES)?

A. Yes.

Q.2 Which IT Enabled Services are considered to be part of BPO operations?

A. As per Central Board of Direct Taxes (CBDT) notification No. 890E dated 26.9.2000, the list of eligible IT enabled services under BPO operations considered in NEBPS are as under:

i) Back office operations

ii) Call centres

iii) Content Development or Animation

iv) Data Processing

vi) Geographic information System Services

vii) Human Resource Services

viii) Insurance Claim processing

ix) Legal Databases

x) Medical Transcription

xi) Payroll

xii) Remote Maintenance

xiii) Revenue Accounting

xiv) Support Centres

xv) Website services

As per NASSCOM, BPO includes following processes that may be IT-enabled, do not necessitate on-shore presence and are hence, offshore-able:

Customer Interaction & Support (CIS)- CIS includes all forms of IT-enabled customer contact; inbound or outbound, voice or non-voice based support used to provide customer services, sales and marketing, technical support and help desk services.

Finance & Accounting (F&A)- F&A includes activities such as general accounting, transaction management (account receivables and payables management), corporate finance (e.g. treasury and risk management, and tax management); compliance management and statutory reporting, etc.

Horizontal-specific BPM services- Services that are reasonably similar across industries. Horizontal BPM services include Customer Interaction and Support (CIS), Finance and Accounting (F&A) and other related processing services, Knowledge Services, Human Resource Management (HRM), Procurement BPM, etc.

Human Resources Processing- HR processing services includes services that support the core HR activities plus talent management activities and associated business processes such as benefits, payroll and talent management.

Knowledge Services- Business research, Market research, Data management & reporting, Data analytics, Social media research, risk management.

The above listed IT Enabled Services (ITES) from CBDT & NASSCOM are considered in NEBPS under BPO operations.

Q.3 How local entrepreneurs from NER can participate in NEBPS?

A. An entrepreneur can form a Consortium with an Indian Company which is able to fulfil the financial eligibility criteria. The eligible Indian Company must have at least 26 % equity shareholder in the Consortium and commit to maintain minimum equity shareholding (26%) for at least three years.