‘Centre must help states to set up large-size SEZs’

Our Corporate Bureau

Mumbai, Aug 3: The Union government should encourage state governments to set up large-size Special Economic Zones (SEZs) rather than relabelling existing Export Processing Zones (EPZs) as SEZs. The EPZs Act as feeder to the SEZs and the government should emphasis on the existence of EPZs, Tariff Commission chairman Dr AK Kundra said.

Dr Kundra was speaking at a seminar on “SEZs in China and India” organised by MVIRDC World Trade Centre and India-China Chamber of Commerce and Industry, here recently.

With the exception of Positra and Dronagiri, all SEZs, most of which have graduated from (EPZs), are around 1,000 hectare as compared to the Chinese SEZs which are large townships, Dr Kundra said.

In China, there are around 41 Economic and Technological Development Zones (ETDZs) similar to the EPZs in India to feed its five SEZs, he added.

The ministry has already approved the conversion of four EPZs into SEZs while around 10 greenfield SEZ projects have been approved for establishment.

In order to see the concept of SEZs succeed in India, he said that the government should relax the labour laws within the SEZs. According to the current regulations, the labour laws of the land will apply to all units inside the zone.

The government should also rationalise the special provisions for sale under domestic tariff area (DTA). It is an incentive which cannot be realised as the procedure for DTA sales is cumbersome and would not take place. In China 50 per cent of the production of SEZs are sold in the DTAs, while in India sales (up to 1999) from EPZs to DTAs accounted for around five per cent, Dr Kundra said.