Nod for Rs 10k-cr investments in SEZs

In last December, Ministry of Commerce & Industry amended SEZ rules to liberalize Work From Home for SEZ units

In Focus

♦ 272 SEZs operational in India

♦ Total investments Rs6 lakh cr in 2022 as against Rs4k cr in 2006

♦ Over 20 lakh people employed at SEZs

♦ Govt redoubled its efforts to promote SEZs

♦ It cleared Rs10,187.13-cr proposals in that direction

The central government has cleared investment proposals worth Rs10,187.13 crore in various Special Economic Zones (SEZs), which will also provide employment to around 21,700 persons. Development Commissioners of various SEZs recently met and cleared a bunch of proposals, official sources told Bizz Buzz.

SEZs, the specified areas where businesses enjoy light regulation and fiscal incentives, are the successors of export processing zones (EPZs). The Special Economic Zone Act-2005, converted EPZs into SEZs.

At present, there are 272 operational SEZs with total investments worth Rs6 lakh crore (2022), up from Rs4,000 crore in 2006. They employ more than two million people.

In the last few years, however, SEZs have not been much in the news, despite the government’s emphasis on boosting manufacturing and exports. The Ministry of Commerce & Industry, under whose jurisdiction SEZs fall, has redoubled its efforts to promote SEZs, the sources said, adding that clearing Rs10,187.13-crore proposals is an attempt in that direction.

Another attempt is to modify the earlier proposals under the Development of Enterprises and Services Hubs (DESH) Bill. One passed, it will be the new law governing SEZs.

As the name suggests, the Bill has provisions for both manufacturing and services units. It has expanded the gambit of services sector units, going beyond the presently specified services like IT and ITeS.

The government is toying with the idea of a criterion named ‘positive net foreign exchange.’ Also, the government may remove the condition that concessional corporation tax rate would be available only until 2032 in a bid to attract more investment.

In December last year, the Ministry of Commerce & Industry had amended SEZ rules to liberalize Work From Home for SEZ units. The idea was to extend the WFH provision to all employees of an SEZ unit. The government hopes to attract good investment in SEZs, especially FDI, which is meager currently.