1. What is a Turnkey Project
In construction, the term TURNKEY refers to projects where the developer takes responsibility from design to competition so that the building is ready to use for the buyer.
Alternatively, it can be described as a real estate development project in which a builder absorbs all risks until a certain point has been reached. To begin using a facility, the owner simply turns the key in the door once the job is finished. This usage is rooted in the construction industry. The buyer of turnkey Property will occupy the home with furnishing and other objects already installed.
In Turnkey-Projects, a private developer takes over all the responsibilities of the project, including land purchases, plans, permit, and construction. After the structure has been built, he sells it to the housing authority. In addition, to turnkey projects, there can be other types such as Engineering Projects, Large construction Projects such as airports, ports, skyscrapers, bridges, and information systems.
2. What is the process of establishing a Turnkey Project
3. Exports of Goods and Services in Execution of a Turnkey Project
A project exports is an export of engineering goods with deferred payments terms or an export of a Turnkey Project. Due to stiff international competitions, exporters conducting these contracts must offer competitors credit terms to secure orders from foreign buyers. The contracts are generally of high value.
In case the seller is offering deferred payment terms to an overseas buyer, or if the seller has been awarded a Turnkey Project by an overseas party, credit terms must be approved by the Authorised Dealer/Exim Bank prior to export.
An instruction memo relating to project exports and services exports outlines the requirements for both.
4. Requirements relating to Completed Projects
After completing Turnkey Contracts abroad, exporters should take the following steps
Closing the foreign currency accounts and transfer the balances to India
Shut-down the foreign site and liaison offices
Cancelling and returning to exporters the Contracts’ guarantees for performance and other guarantees issued
You must cancel the counter- guarantees as well as liquidate overseas borrowing and overdrafts
Ensure compliance with taxes, customs, and other statutory obligations in the country of the project should be made
In order to dispose of or arrange the importation of equipment, machinery, vehicles, etc. purchased abroad.
Repatriate to India funds, if Any, transferred to other overseas projects.
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