First Economic Zone Notified
Santa Cruz, Surat, Cochin become SEZs
Date : 01 Nov 2000
The Government hasd today issued notifications for the conversion of the Export Processing Zones at Kandla(Gujrat), Santa Cruz (Maharashtra) and Cochin into Special Economic Zones (SEZs). Notification has also been issued for conversion of the private sector EPZ at Surat (Gujarat) into a Special Economic Zone at the request of the promoters. In addition to conversion of some of the EPZs into SEZs, government have granted in principle approval for the establishment of seven Special Economic Zones at : Positra (Gujarat) in the private sector and by the State Governments at Nanguneri (Tamil Nadu), Dronagiri (Maharashtra), Kulpi (West Bengal), Paradeep (Orissa), Bhadohi (U.P.) and Kakinada (Andhra Pradesh). These Zones are expected to come up in the near future. This is in pursuance of the announcement made by Shri Murasoli Maran, Minister of Commerce and Industry – on the occasion of the announcement of the EXIM Policy on March 31, 2000 – of a new scheme for the setting up of Special Economic Zones in the country to promote exports. The policy provided for the setting up of SEZs in the public, private, joint sector or by State Governments. Shri Maran had also announced that some of the existing Export Processing Zones would be converted into Special Economic Zones.
The Special Economic Zone scheme is intended to provide an internationally competitive and hassle-free environment for exports. Some of the distinctive features of the scheme are : a) A designated duty free enclave, to be treated as foreign territory for trade operations and duties and tariffs; b) SEZ units could be for manufacturing, trading and services; c) No routine examination of export and import cargo by Customs d) Sale in domestic market on payment of full duty; e) SEZ units to be positive net foreign exchange earner in three years; f) No fixed wastage norms; g) Duty free goods to be utilised within the approval period of 5 years; h) Performance of SEZ units to be monitored by a Committee consisting of the Development Commissioner of the Zones and Customs; i) Once approval is granted, subsequent changes in the line of activity need only an intimation to the Development Commissioner; j) Subcontracting of part of production and production process allowed for all sectors including jewellery units; k) 100% foreign direct investment (FDI) through the automatic route in the manufacturing sector and l) Simplified accounting procedures – SEZ units to maintain accounts in formats of their choice.
Necessary Customs and Excise Notifications providing a simplified framework for SEZ units have also been issued on 19/10/2000.
The SEZ scheme is expected to give a further boost to the country’s exports.