Introduction Of Sez

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Introduction Of Sez

  1. 1. Special Economic Zones A Brief Presentation by: ZEESHAN SHAHZAD KHURRAM
  2. 2. What is an SEZ? “….it is a specifically delineated duty- free enclave and shall deemed to be a foreign territory for the purposes of trade operations and duties and tariffs” The purpose - “... to provide an internationally competitive and hassle-free environment for exports”
  3. 3. a background  it started with the Export Processing Zones in the mid 1960s  a total of 8 export processing zones established to boost export and manufacturing – Kandla and Surat (Gujarat), SEEPZ –(Maharashtra), Chennai (Tamil Nadu), Falta(West Bengal), Noida(UP), Cochin (kerala), Vishakhapatnam (AP)  in 2000 the SEZ policy was brought in to attract more investments – foreign and domestic; state policies were made  In 2005 SEZ Act and in February 2006 the SEZ rules were notified by the Ministry of Commerce
  4. 4. what is special?  duty-free! exemption from taxes, various subsidies and tax sops  hassle-free! exemption from stringent labour and environment regulations  land acquisition upto 1000 ha  Only 25% of the area for industrial activity – the rest of the area for entertainment and residential as well as other commercial activities!
  5. 5. Present status of SEZ  150 SEZ are already approved and another 240 SEZ applications are under the process of approval.  85 are in for IT and ITES  14 for pharma and Biotechnology  9 for textile and apparels  10 for multi product SEZ’s
  6. 6. Functional SEZs at present At present there are eight functional SEZs located at:  SantaCruz (Maharashtra),  Cochin (Kerala),  Kandla and Surat (Gujarat),  Chennai (Tamil Nadu),  Visakhapatnam (Andhra Pradesh),  Falta (West Bengal) &  Nodia (Uttar Pradesh) in India. Further a SEZ at Indore (Madhya Pradesh ) is now ready for operation.
  7. 7. Advantages  Generation of additional economic activity  Promotion of exports of goods and services  Promotion of investment from domestic and foreign sources  Creation of employment  Development of infrastructure facilities
  8. 8. Advantages  Simplified procedures for development, operation, and maintenance of the Special Economic Zones and for setting up units and conducting business  Exemption from import duty, VAT and other Taxes  A vibrant industrial city with abundant supply of skilled manpower.  Pollution free environment with proper drainage and sewage system
  9. 9. Disadvantages  Loss of revenue  Land acquisition  No strategic planning for electicity and water  Creating pollution  Exploitation of labours  Fertile lands being used for establishing industrial units
  10. 10. Conclusion Four things are important :  The government must slow down the process of giving approvals.  This is important not only for social or political reasons but also due to economic realities.  Legal institutions related to land acquisition ( including land acquisition modalities, compensation package and rehabilitation package) must be addressed. Introduce a performance based exit policy for SEZ developers Finally, the policy should be treated as transitory.
  11. 11. QUESTIONS/ SUGGESTIONS/ COMMENTS ???

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