Sez in India

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CONTENTS |

1 EXECUTIVE SUMMARY……………………………………..……………………3

1 HISTORY OF SEZ IN INDIA ....................................................................................4

2 SEZ LOCATIONS IN INDIA …………………………………….…...…………….6

3 SPECIAL ECONOMIC ZONES IN INDIA…...……………………………………..7 4 APPROVAL MECHANISM AND ADMINISTRATIVE SET UP OF SEZS……...10

5 INCENTIVE/ FACILITIES ……................................................................................11

6 ADVANTAGES OF SEZ UNITS IN INDIA………………………………………..15 7 SEZ AND EXPORT PROMOTION .................................................…….…………18

8 FEATURES AND FACILITIES OF INDIAN SEZ ………………………………..20

9 FIRST SEZ POLICY OF INDIA ………....…………………………...…………….21 10 SWOT ANALYSIS FOR INDIAN SEZ….................................................................24

11 REQUIREMENTS OF MINIMUM AREA OF LAND ….........................................26

12 SEZ AND LAND ACQUISITION……………………………….…………………27

13 PROS AND CONS OF SEZ POLICY …………………....………………………...28

14 PROCEDURE OF SETTING UP SEZ UNIT IN INDIA……………………………31

15 SEZ RULES 2006……………………………………………………………..……..32

16 SPECIAL ECONOMIC ZONES AND FOREIGN CAPITAL………………………34

17 SPECIAL ECONOMIC ZONES AND TAX INCENTIVES………………………...37

18 CONCLUSION…………….………………………………………………………….39

19 BIBLIOGRAPHY…………………………………………………………………..…40

EXECUTIVE SUMMARY

Special Economic Zones (SEZs) were established in many countries as testing grounds for implementation of liberal market economy principles. SEZs are viewed as instruments enhancing the acceptability and credibility of transformation policies, attracting domestic and foreign investment and also for the opening upon the economy. SEZs in India seek to promote the value addition component in exports, generate employment as well as mobilize foreign exchange. Globally, many countries initiated Free Trade Agreements (FTAs) which eventually led to a spurt in investments in infrastructure developments for Free Trade Zones (FTZs) and SEZs. A close examination of the evolution of SEZs in countries with similar economies as India will help us to understand their success stories and thereby implement those factors, in order to curb the SEZ bottlenecks faced by India today. The Shenzhen SEZ in China is a perfect example of a SEZ success story. In India, the government has been proactive in the development of SEZs. They have formulated policies, reviewed them occasionally and also ensured that ample facilities are provided to the SEZ developers as well as the companies setting up units in SEZs. These favourable conditions resulted in the biggest ever corporate rush for the development of SEZs in India. Over 234 companies received formal approval, 162 companies received in-principle approval and 100 companies received notification to set up SEZs. The Indian government is expecting an investment to the tune of Rs.53,561 crore (USD 13274 million) and an additional job creation for 15,75,452 individuals in SEZs by December 2009. Despite all the efforts, SEZ development has become the most controversial issue for India today. It is very important to understand all aspects of SEZs such as basic concepts, its various models and the life cycle of its business before initiating any policy or investments for these projects. Despite the fact that the existing SEZ Act and FDI Policies for SEZs are very lucrative; the rationale behind the rapid economic and industrial growth of the Indian SEZ policy is being questioned.

Special Economic Zone (SEZ) is a duty free area which is meant for the purposes of trade...
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