Meeting on SEZ, DMIC, NMIZ in PMO tomorrow

The Prime Minister's Office has called a meeting of officials tomorrow to firm up proposals for reviving the beleaguered special economic zones.
Officials in the ministries of finance and commerce and industry will attend the meeting which will also discuss the progress of the industrial corridor and manufacturing zones.
The issues that are expected to figure in the meeting include SEZs, Delhi-Mumbai Industrial Corridor (DMIC) and National Investment and manufacturing Zones (NIMZs), sources said.
The impact of imposition of minimum alternate tax (MAT) and dividend distribution tax (DDT) on SEZs is also likely to be deliberated in the meeting.
The meeting assumes significance as the country's exports and manufacturing are not growing at healthy rates and SEZs can play an important role in boosting both exports and manufacturing besides generating jobs.

A decline in manufacturing output and lower offtake of consumer durables had pulled down industrial production growth to four-month low of 0.5 per cent in July, dashing hopes of recovery.

Continuing the downtrend, export growth slipped to 2.35 per cent to USD 26.95 billion in August, pushing up trade deficit to USD 10.83 billion.
Of the 566 formally approved SEZs, only 185 are in operation.
"Progress in the DMIC and NIMZ project would be discussed in the meeting," a source said.
The Commerce Ministry has already asked its finance counterpart to consider roll back the MAT imposed on SEZs, saying that the levy has suppressed the potential of these zones as a tool to promote exports and generate employment.

The industry too has been complaining that that MAT and the dividend distribution tax (DDT) on SEZs have dented the investor sentiment and also implementation of the scheme. In 2011, government had imposed 18.5 per cent MAT on the book profits of special economic zone developers and units.
The previous government has formulated the National Manufacturing Policy (NMP), which aimed at raising the share of manufacturing to 25 per cent of GDP by 2022 from the current 16 per cent. The NMP envisages setting up of NIMZs, which are industrial townships, benchmarked to the best manufacturing hubs in the world.

NIMZs are conceptualised as integrated industrial townships of at least 50 sq km (5,000 hectares) with state-of- the-art infrastructure.
The government had notified several NIMZs, including one each in Haryana, Uttar Pradesh, Gujarat and Madhya Pradesh; two in Rajasthan and three in Maharashtra.
The DMIC project is aimed at creating mega industrial infrastructure along the Delhi-Mumbai Rail Freight Corridor. Japan is giving financial and technical aid for the project, which is developed on either side of a 1,483-km stretch running across seven states.