Special Economic Zones in India: Suresh Kumar B30
Special Economic Zones in India: Suresh Kumar B30
Special Economic Zones in India: Suresh Kumar B30
INTRODUCTION
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 the multiplicity of controls and clearances; absence of world-class infrastructure, and an unstable fiscal regime and with a view to attract larger foreign investments in India, the Special Economic Zones (SEZs) Policy was announced in April 2000.
All 8 EPZs converted into SEZs: Kandla ( Gujarat) Seepz( Maharashtra) Noida (U P) Madras ( T N) Cochin ( Kerala ) Falta ( W B) Visakhapatnam( AP) Surat ( Gujarat ) : 1965 (625 Acres) : 1975 (110 Acres) : 1986 (310 Acres) : 1986 (262 Acres) : 1986 (103 Acres) : 1986 (280 Acres) : 1994 (360 Acres) : 1998 (103 Acres)
Approval Committee
Every SEZ has one approval committee Approval Committee has 9 members Development commissioner is Chairperson of Approval Committee
Overview
SEZ are delineated duty-free enclaves treated as a foreign territory for the purpose of trade operations, Duties and tariffs Developed in the public, private or joint sectors, or by the State Governments or any person for manufacture of goods or rendering services or both or as a FTWZ Import / export operations of the SEZ units on selfcertification basis. SEZ units have to be a net foreign exchange earner
Government has allocated a least favorable area of 1,000 hectares for greenfield SEZs. Although, there are no limitation in context of favorable area in constructing sector specific SEZs.
100% of Foreign Direct Investment is allowed for all endowments in Special Economic Zones, apart from activities cataloged under the unconstructive record.
SEZ divisions are obligatory to be encouraging net foreign exchange yielders and are not entitle to any least amount of value addition guidelines or export responsibilities.
Commodity surge from Domestic Tariff Area (DTA) into a SEZ is recognized as exports and commodity surge into DTA from SEZ are recognized as imports.
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Benefit of SEZ
Full Income tax exemption for a period of 5 years and an extra 50% tax relief for additional two years. Manufacturing industry is allowed an FDI influx of 100% via automatic channels excluding few industries. Services to establish off-shore banking divisions in SEZs Service Tax and Central Sales Tax exemption External commercial lending of upto US$500 million is allowed for SEZ divisions in a year sans any maturity limitations via certified banking networks. No import authorization obligations. Services to sustain foreign exchange proof of payments of upto 100% in Exchange Earners' Foreign Currency Account. SEZ franchisees are allowed100% FDI in offering customary telephone facilities in the areas. No limitation of foreign endowments for small scale industry reticent products. Tax relief from sectoral authorization obligations for goods reticent for SSI industry
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Rajkumar S. Adukia
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QUESTIONS?????
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THANK YOU
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