Net Foreign Exchange (NFE) Earnings

6.10.1

EOU / EHTP / STP / BTP unit shall be a positive net foreign exchange earner. NFE earnings shall be calculated cumulatively in the block period as per para 6.5 of FTP, according to the formula given below. [OLD- Net Foreign Exchange (NFE) Earnings shall be calculated cumulatively for a block of five years from commencement of production according to formula given below. ] Items of manufacture for export specified in Letter of Permission (LoP) / Letter of Intent (LoI) alone shall be taken into account forcalculation of NFE.

(Above Second sentence has been substituted vide PN. NO. 53/2008, DT. 23/07/2008)

Positive NFE = A-B> 0

Where

‘NFE’ is Net Foreign Exchange;

‘A’ is FOB value of exports by EOU/EHTP/STP/BTP unit;

‘B’ is sum total of CIF value of all imported inputs and CIF value of all imported capital goods, and value of all payments made in foreign exchange by way of commission, royalty, fees, dividends, interest on external borrowings / high sea sales during first five year period or any other charges. It will also include payment made in Indian Rupees on high sea sales. “Inputs” mean raw materials, intermediates, components, consumables, parts and packing materials.