PRESENTED BY: NEERAV SINGH CHIB B(41) NEERAJ PENDHARKAR B(52)

SOUMENDRA MAHAPATRA B (54) VIVEK SIROHI B(56) HARSHIT PATNI C(50)

INTRODUCTION
# Definition # 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

APPROVAL PROCESS

DEVELOPER

STATE GOVT.

BOARD OF APPROVAL

APPROVAL COMMITTEE

TYPES OF SEZ
# Sector Specific SEZ units # Multi - product SEZ units # Other SEZs include SEZ in a port or airport SEZ for Free Trade and Warehousing

OBJECTIVES
# Generation of additional

economic activity # Promotion of exports of goods and services # Promotion of investment from domestic and foreign sources # Creation of employment opportunities # Development of infrastructure facilities

ACTIVITIES IN SEZ
Processing Area Non Processing Area

BURNING ISSUES OF SEZ

# Inadequate

# # #
# # # # #

Infrastructure Restrictive policies Lengthy Procedure Locational Disadvantages Labor Exploitation Finance Ministry Political Interference Land Acquisitions Unethical Practices

FACILITIES TO SEZ ENTERPRISE

# OPERATIONAL ADVANTAGES: # No routine customs checks # Power at concessional rates

Faster clearances from govt. # FISCAL ADVANTAGES: # Permission to sell within Domestic Tariff Area (DTA) # An exemption from a Special Addition Duty (SAD) subject to the company having a positive Net Foreign Exchange Position (NFEP) # Investments in SEZ treated as infrastructure development and eligible for Tax exemption # Local inputs at reduced cost without the excise, VAT and other levies of India # Duty free import of materials for construction, capital goods
#

# Income tax
100% IT exemption for first 5 years 50% for next 5 years

50% of the ploughed back export profit

# Foreign Direct Investment: 100% FDI is allowed in most sectors in SEZ # Banking / External Commercial Borrowings: Setting up Off-shore Banking Units allowed in SEZs. External commercial borrowing by SEZ units upto US $ 500 million in a year without any maturity restriction Flexibility to keep 100% of export proceeds in EEFC account.

FACILITIES TO SEZ DEVELOPERS

# EXEMPTION FROM

Customs/excise duties Income Tax on income derived from the business of development of the SEZ Minimum alternate tax Dividend distribution tax Central Sales Tax (CST) Service Tax

SEZ AND ECONOMIC GROWTH OF INDIA

# The SEZ policy was first introduced in India in April 2000, as a part of the Export-Import (EXIM) policy of India. # Current investment and employment:

Investment: Rs. 43123 crores Employment: 13,50,053 persons

# Expected investment and employment (by December 2012):

Investment: Rs. 2,59,159 crores Employment: 17,43,530 additional jobs

CURRENT DEVELOPMENTS
# Reliance Industries is pumping in Rs

30,000 crores into two SEZs in Maharashtra and another Rs 40,000 crores in Haryana # DLF is investing over Rs 31,000 crores in four units in Amritsar, Ambala, Ludhiana and Gurgaon # DS group has a Rs 12,000-crore plan for two SEZs in Haryana and Himachal Pradesh # Bharat Forge, Videocon, and Suzlon are investing over Rs 1,000 crores each in SEZs in places such as Pune and Mangalore

PROBLEMS POSED BY SEZs

# Loss of Tax Revenue # Land Acquisition: Major

Problem in establishing SEZs. One-time compensation: The landowner can be paid the prevailing market price up front. Providing jobs as compensation to the member of affected family in SEZs Land - scarcity

RECOMMENDATIONS
#

The role of the Government in land acquisition should not be diluted at any cost to save the poor farmers from the clutches of land mafia The emphasis should be on better prices and rehabilitation package

The SEZ should be located strategically close to seaports and airports, major highways and/or accessible to multiple modes of transportation Site selection must result in minimal resettlement and encroaching upon crop fields. The FTZ/SEZ zoning strategy must be very strong and well thought out entertainment, schools, etc

# Value Added Services such logistic services,

THANK YOU