Govt expands list of default activities in SEZs

The Centre today allowed special economic zone (SEZ) developers to offer space for warehousing and banking/ATM services without obtaining prior permission from it.

"It has been decided to further expand the list of default authorised operations...The development commissioners /unit approval committees may allow the developer/approved co-developers duty-free goods and services for these default authorised operations," the commerce ministry said.

Earlier, except for services like telecom facilities, rain water harvesting plant, effluent treatment plant and roads, SEZ developers had to approach the inter-ministerial board of approval for permission. These operations will, however, continue to be subject to various government guidelines.

"The approval committees while approving goods and services for such default operations may look into the actual requirement of SEZs for such operations," the statement added.

The ministry also said trading and warehousing units located within free trade warehousing zones, a kind of SEZ, can now carry two-way transactions within the domestic market. Under the SEZ Act, units in these zones are given 100 per cent tax exemption on their income for the first five years and 50 per cent in the next five years.

Formal approval has been accorded to 575 SEZ proposals out of which 348 have been approved. A total of 105 have commenced operations so far.