Revenue loss may lead to reversal of SEZ policy: Study

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Friday , February 15, 2008 at 1552 hrs of the formally approved SEZs are IT/ITeS sector specific and the reversal of these schemes could cause a mismatch in supply and demand from IT and export manufacturing businesses, potentially affecting the ability of the developers to attract tenant businesses to their SEZs,” it said.

Land acquisition has also proved to be the biggest hurdle for SEZs, the study says. Amid rising land prices across the country, the SEZ policy has come under fire as a means of land grabbing by developers, allowing the removal of land in return for inadequate compensation and “conversion of valuable fertile farm land into industrial zones”.

The study estimates that projected investment in SEZs over the next 10 years could be 213 billion dollars, if 75 per cent of the formally approved zones and 25 per cent of the in-principle approved SEZ land is developed and operational.

Exports from the SEZs during the 10-year period could touch 352 billion dollars, nearly half of India’s total annual exports, with IT and ITeS SEZs contributing 30 per cent at 105 billion dollars.