Land laws impede formulation of SEZ Act

Jyotsna Bhatnagar

Ahmedabad, Oct 31: The existing land acquisition laws, the Electricity Supply Act and the Indian Electricity Act as well as a slew of revenue laws are proving to be major stumbling blocks in the path of formulation of a comprehensive Special Economic Zone (SEZ) Act which would provide a competitive edge to these zones similar to that being enjoyed by Chinese SEZs.

Highly placed officials of the Gujarat government which, incidentally, is taking the lead in coordinating the efforts of the state goverments in a bid to give adequate representation to their concerns in formulation of the SEZ Act, revealed that in a status paper of legalities which were likely to impinge upon the SEZ framework, a strong case has been made for amending these laws. Presently, the Gujarat government is playing a pivotal role in coordinating the efforts of state governments, specially the Tamil Nadu and Karnataka governments with the Centre to formulate a comprehensive SEZ framework.

Highly placed state government sources revealed that since the stakes of Gujarat are the highest with the state having the largest number of planned SEZs in the pipeline, namely Surat, Positra, Kandla and Mundra, the state government has taken upon itself the role of mediator between the Centre and state goverments since "at this juncture it is vital to have a synergy between the two."

In this regard, following the submission of KPMG’s first report on a legal review of the laws which could impinge upon the formation of a comprehensive SEZ Act, the Gujarat government has recently forwarded its inputs to the Union commerce ministry.

Knowledgeable sources here disclosed that the state government has mentioned the existing land acquisition and power laws as major stumbling blocks.