1. Special Economic
Zones
A Brief Presentation by:
ZEESHAN
SHAHZAD KHURRAM

2. What is an SEZ?
“….it is a specifically delineated duty-
free enclave and shall deemed to be
a foreign territory for the purposes of
trade operations and duties and
tariffs”
The purpose -
“... to provide an internationally
competitive and hassle-free
environment for exports”

3. a background
 it started with the Export Processing Zones in the
mid 1960s
 a total of 8 export processing zones established
to boost export and manufacturing – Kandla
and Surat (Gujarat), SEEPZ –(Maharashtra),
Chennai (Tamil Nadu), Falta(West Bengal),
Noida(UP), Cochin (kerala), Vishakhapatnam
(AP)
 in 2000 the SEZ policy was brought in to attract
more investments – foreign and domestic; state
policies were made
 In 2005 SEZ Act and in February 2006 the SEZ
rules were notified by the Ministry of Commerce

4. what is special?
 duty-free! exemption from taxes, various
subsidies and tax sops
 hassle-free! exemption from stringent
labour and environment regulations
 land acquisition upto 1000 ha
 Only 25% of the area for industrial activity
– the rest of the area for entertainment
and residential as well as other
commercial activities!

5. Present status of SEZ
 150 SEZ are already approved and
another 240 SEZ applications are under
the process of approval.
 85 are in for IT and ITES
 14 for pharma and Biotechnology
 9 for textile and apparels
 10 for multi product SEZ’s

6. Functional SEZs at present
At present there are eight functional SEZs located at:
 SantaCruz (Maharashtra),
 Cochin (Kerala),
 Kandla and Surat (Gujarat),
 Chennai (Tamil Nadu),
 Visakhapatnam (Andhra Pradesh),
 Falta (West Bengal) &
 Nodia (Uttar Pradesh) in India.
Further a SEZ at Indore (Madhya Pradesh ) is now ready for
operation.

7. Advantages
 Generation of additional economic activity
 Promotion of exports of goods and
services
 Promotion of investment from domestic
and foreign sources
 Creation of employment
 Development of infrastructure facilities

8. Advantages
 Simplified procedures for development,
operation, and maintenance of the Special
Economic Zones and for setting up units and
conducting business
 Exemption from import duty, VAT and other
Taxes
 A vibrant industrial city with abundant supply of
skilled manpower.
 Pollution free environment with proper drainage
and sewage system

9. Disadvantages
 Loss of revenue
 Land acquisition
 No strategic planning for electicity and
water
 Creating pollution
 Exploitation of labours
 Fertile lands being used for establishing
industrial units

10. Conclusion
Four things are important :
 The government must slow down the process of giving
approvals.
 This is important not only for social or political reasons
but also due to economic realities.
 Legal institutions related to land acquisition ( including
land acquisition modalities, compensation package and
rehabilitation package) must be addressed.
Introduce a performance based exit policy for SEZ
developers Finally, the policy should be treated as
transitory.

11. QUESTIONS/
SUGGESTIONS/
COMMENTS ???