SPECIAL ECONOMIC ZONES (SEZs) IN INDIA

Prepared by : harsh kothari MBA GLSICT

Introduction
- From ancient times Harappan, Roman to mediaeval times - Modern times Free ports Aden, Singapore, Hong Kong Difference - Modern version of export zones starting from Puerto Rico (USA)
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India Kandla in 1965.

SPECIAL ECONOMIC ZONES (SEZs) IN INDIA

Common Features of SEZs Duty-free imports of capital goods and inputs for production for Export Liberal access to foreign exchange Encouragement to FDI Generous tax concessions esp. in early years Flexible Labour Laws

SPECIAL ECONOMIC ZONES (SEZs) IN INDIA

Rationale for SEZs

- Main benefits sought from SEZs are:

* * * Faster economic growth Employment generation on a large scale Earning more foreign exchange

* Introduction of modern technologies & their demonstration and spread effects

SPECIAL ECONOMIC ZONES (SEZs) IN INDIA

SEZs in India Experience with EPZs Starting with Kandla in 1965; SEEPZ in 1972, Based on reviews of working, Cochin, Falta, Madras (Chennai) and NOIDA in 1984 and Vizag in 1989 Less than 40% of approvals fructified
Rest cancelled or lapsed

Employed only 0.01% of labour force FDI was less than 20% of total investment Accounted for less than 4% of exports. Net export much lower as imports were over 60% of exports

SPECIAL ECONOMIC ZONES (SEZs) IN INDIA

SEZs in India The reasons were: (i) Very Small Size of EPZs

Location Kandla (Gujarat) SEEPZ (Mumbai) Cochin (Kerala) NOIDA (UP) Chennai (TN) Vizag (AP) Falta (WB)

Size (Sq.miles) 1.17 0.15 0.16 0.48 0.41 0.56 0.44

SPECIAL ECONOMIC ZONES (SEZs) IN INDIA

SEZs in India (ii) (iii) (iv) Inadequate infrastructure Lengthy procedures tough labour laws In the 1990s, as a part of reforms, powers delegated to zone authorities, additional fiscal incentives were given, policy provisions were simplified and greater facilities were provided leading to some, not very significant, improvements.

SPECIAL ECONOMIC ZONES (SEZs) IN INDIA Special Economic Zones in Kerala

1. SEZ for Electronics at Kalamassery, Ernakulam District The SEZ is planned in an area of 30 acres. Expressions of interest have been called for getting a co-developer. However, the response has not been very encouraging and hence KINFRA, who is the implementing agency, is on the lookout for a co-developer. 2. SEZ for Food Processing Kakkanchery, Malappuram District The SEZ is planned in an area of 30 acres for which KINFRA on the lookout for a co-developer. Government of India has already given approval. 3. SEZ for Animation and Gaming, Trivandrum District This SEZ is planned in Trivandrum District within the already existing video park of KINFRA. SEZ is planned in an area of 25 acres. KINFRA has also constructed a building 1,50,000 sq.ft. and is on the lookout of a co-developer. Government of India has already given approval.

SPECIAL ECONOMIC ZONES (SEZs) IN INDIA Special Economic Zones in Kerala

4. Infopark, Ernakulam District Approval obtained from Government of India for converting the existing Infopark into a SEZ. Discussions are being held with Dubai Internet City for handing over the Infopark to be developed as Smart City. 5. Technopark, Trivandrum District Inprinciple approval has been obtained by the existing Technopark, Trivandrum from Government of India for converting 100 acres of their 3rd phase expansion into a SEZ for IT & IT enabled services. 6. New SEZs being proposed by KSIDC are:SEZ for health care products in Trivandrum District (100 acres) SEZ for textiles at Cherthala, Alappuzha District (250 acres) SEZ for petrochemical products at Kasargod District (1000 acres)