No change in minimum SEZ area, 33 zones denotified

The UPA government has no plans to alter the minimum land requirement for setting up a special economic zone (SEZ), minister of state for commerce and industry Jyotiraditya Scindia said on Wednesday.

The present norms pegs the minimum size of land required to set up an IT-ITeS, gems and jewellery, electronics and biotec SEZ at 10 hectares. It is 1,000 hectares for a multiproduct SEZ. As for port/airport-based SEZs, the minimum threshold is 100 hectares, except for Union territories besides Goa, Himachal Pradesh, Uttaranchal, Sikkim and J&K and the northeastern states,barring Manipur. Scindia, in a written reply to a specific question in the Rajya Sabha, also said within the period from December 2008 till now, the Board of Approval for SEZs under his ministry had de-notified or cancelled 33 SEZ projects.

 

“The reasons for these requests, wherever indicated by the applicants, range from economic meltdown, poor market response, non-availability of skilled labour force, no demand for IT-ITeS space and imposition of minimum alternate tax and dividend distribution tax on SEZs,” Scindia said.

Some of the significant names that have approached the government to de-notify their SEZ projects are DLF, K Raheja, Maytas Ventures, Unitech Infopark, Raheja Universal, Essar SEZ Hazira, Maharashtra Industrial Development Corporation Ltd , Bata India Ltd and Bengal Shapoorji Infrastructure Development Pvt Ltd and Bengal Shapoorji Infrastructure Development Pvt Ltd.

SEZ units are given 100 per cent income-tax exemption on export income under Section 10AA of the Income Tax Act for first 5 years, 50 per cent for next 5 years thereafter and 50 per cent of the ploughed back export profit for next 5 years.

They are also exempted from paying MAT and DDT at present.

The BoA, under Ministry of Commerce and Industry, has so far granted formal approval to 584 SEZs, out of which 378 have been notified and would become operational soon. The board is scheduled to meet next on September 9.