Special Economic Zones
Special Economic Zones
Introduction
A Special Economic Zone (SEZ) is a geographically bound area in a country that possesses special economic regulations that are different from other areas in the same country.The purpose of SEZ to encourage industrialization specially to facilitate FDI for export oriented production for the purpose of trade.
The category 'SEZ ' covers a broad range of more specific zone types, including Free Trade Zones (FTZ), Export Processing Zones (EPZ), Free Zones (FZ), Industrial Estates (IE), Free Ports, Urban Enterprise Zones and others. As per Ministry of Commerce and Industry they are defined as: “Special economic zone is a specifically duty free enclave and shall be deemed to be foreign territory for the purpose of trade operations and duties and tariffs.”
The Rationale of the SEZ
The SEZ is a subset within the geographical boundaries of the state. They are needed to: * Exports * develop infrastructure * Increase employment by adhering to the principles of free markets * Minimise distortions caused by effective administration and low or no taxes
Traditionally, SEZs are created as open markets within an economy that is dominated by any kind of distortion in trade, macro and exchange regulation and other regulatory governmental controls. SEZs are believed to create a conducive environment to promote investment and exports. And hence, many developing countries are developing the SEZs with the expectation that they will provide the engines of growth for their economies to achieve industrialization.
Inception of SEZ
The Special Economic Zones Act, 2005’ was passed on the 23rd June, 2005, in an attempt to give a framework to the implementation of SEZs in India .
India was one of the first in Asia to recognize the effectiveness of the Export Processing Zone (EPZ) model in promoting exports, with Asia 's first EPZ set up in Kandla in 1965. With a view to overcome the shortcomings experienced on account of
Introduction
A Special Economic Zone (SEZ) is a geographically bound area in a country that possesses special economic regulations that are different from other areas in the same country.The purpose of SEZ to encourage industrialization specially to facilitate FDI for export oriented production for the purpose of trade.
The category 'SEZ ' covers a broad range of more specific zone types, including Free Trade Zones (FTZ), Export Processing Zones (EPZ), Free Zones (FZ), Industrial Estates (IE), Free Ports, Urban Enterprise Zones and others. As per Ministry of Commerce and Industry they are defined as: “Special economic zone is a specifically duty free enclave and shall be deemed to be foreign territory for the purpose of trade operations and duties and tariffs.”
The Rationale of the SEZ
The SEZ is a subset within the geographical boundaries of the state. They are needed to: * Exports * develop infrastructure * Increase employment by adhering to the principles of free markets * Minimise distortions caused by effective administration and low or no taxes
Traditionally, SEZs are created as open markets within an economy that is dominated by any kind of distortion in trade, macro and exchange regulation and other regulatory governmental controls. SEZs are believed to create a conducive environment to promote investment and exports. And hence, many developing countries are developing the SEZs with the expectation that they will provide the engines of growth for their economies to achieve industrialization.
Inception of SEZ
The Special Economic Zones Act, 2005’ was passed on the 23rd June, 2005, in an attempt to give a framework to the implementation of SEZs in India .
India was one of the first in Asia to recognize the effectiveness of the Export Processing Zone (EPZ) model in promoting exports, with Asia 's first EPZ set up in Kandla in 1965. With a view to overcome the shortcomings experienced on account of
References: http://www.parsvnath.com/images/sezs-map.jpg http://www.spireresearch.com/wp-content/uploads/2012/03/India-Q3-MAP.png