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Special Economic Zones

SEZ (Special Economic Zone) is one or more areas of a country where the tariffs and quotas are eliminated and bureaucratic requirements are lowered so that more companies are attracted to the area or in other words, economic laws are more liberal than a country’s typical economic laws . The companies establishing in the area also gets extra benefits for doing business.

In India the policy for setting up SEZ was announced on April 1, 2000 with a view to provide an internationally competitive and hassle free environment for exports and overcome the shortcomings experienced on account of the multiplicity of controls and clearances; absence of world-class infrastructure, and an unstable fiscal regime and with a view to attract larger foreign investments in India. The policy offered setting up of SEZ in the public, private, joint sector or by State Governments.

SEZs allow the government to experiment with radical (in the Indian context) economic reform in a sufficiently large geographical area (minimum size 1,000 hectares) but on a localized basis, without the difficulty of introducing such reforms at the national level.

This policy intended to make SEZs an engine for economic growth supported by quality infrastructure complemented by an attractive fiscal package, both at the Centre and the State level, with the minimum possible regulations. SEZs in India functioned from 1.11.2000 to 09.02.2006 under the provisions of the Foreign Trade Policy and fiscal incentives were made effective through the provisions of relevant statutes.

To instill confidence in investors and signal the Government’s commitment to a stable SEZ policy regime and with a view to impart stability to the SEZ regime thereby generating greater economic activity and employment through the establishment of SEZs, a comprehensive draft SEZ Bill prepared after extensive discussions with the stakeholders. A number of meetings were held in various parts of the country both by the Minister for Commerce and Industry as well as senior officials for this purpose. The Special Economic Zones Act, 2005, was passed by Parliament in May, 2005 which received Presidential assent on the 23rd of June, 2005. The draft SEZ Rules were widely discussed and put on the website of the Department of Commerce offering suggestions/comments. Around 800 suggestions were received on the draft rules. After consultations, the SEZ Act, 2005, supported by SEZ Rules, came into effect on 10th February, 2006, providing for drastic simplification of procedures and for single window clearance on matters relating to central as well as state governments.

objectives of the SEZ Act

(a) generation of additional economic activity
(b) promotion of exports of goods and services;
(c) promotion of investment from domestic and foreign sources;
(d) creation of employment opportunities;
(e) development of infrastructure facilities;

The SEZ Act 2005 is key role for the State Governments in Export Promotion and creation of related infrastructure. A 19 member inter-ministerial SEZ Board of Approval (BoA) has provided a Single Window SEZ approval mechanism. The applications duly recommended by the respective State Governments/UT Administration are considered by this BoA periodically. All decisions of the Board of approvals are with consensus.

The SEZ Rules provide for :

1. Simplified procedures for development, operation, and maintenance of the Special Economic Zones     and for setting up units and conducting business in SEZs;
2. Single window clearance for setting up of an SEZ;
3. Single window clearance for setting up a unit in a Special Economic Zone;
4. Single Window clearance on matters relating to Central as well as State Governments;
5. Simplified compliance procedures and documentation with an emphasis on self certification

The SEZ Rules provide for different minimum land requirement for different class of SEZs. Every SEZ is divided into a processing area where alone the SEZ units would come up and the non-processing area where the supporting infrastructure is to be created.

Lists of SEZ in India

The following are the list of SEZ in India. Out of these, Noida (Uttar Pradesh), Falta (West Bengal), Chennai (Tamil Nadu) and Vishakapatnam (Andhra Pradesh) SEZ were Export Processing Zone (EPZ) before April 1, 2003.

SEEPZ Special Economic Zone
SEEPZ, Andheri (East)
Mumbai - 400096
Tel.: +(91)-(22)-28290856/ 1388/ 0046/ 2147/ 2144
Fax: +(91)-(22)-28291385/ 22829175
E-mail: dc@seepz.com
Website: www.seepz.com

Kandla Special Economic Zone
KSEZ, Gandhidham, Kachchh
Tel.: +(91)-(2836)-252194/ 273/ 194/ 475/ 281
Fax: +(91)-(2836)-252250
E-mail: dc@kasez.com
Website: www.kasez.com

Add comment May 18th, 2007