Know more about special economic zone (SEZ)
WHAT IS SEZ?
Special economic zones (SEZ’s) are areas in which business and trading laws differ from those in the rest of the country. A SEZ is located within the national borders of a country.
In April 2000, the Special Economic Zones (SEZ) Policy was announced. The result was a much more efficient and larger form of their predecessors with world-class infrastructure. As of 10th February 2005, the SEZ Act, 2005 and the SEZ Rules came into force.
Why SEZ was introduced :
It was introduced to boost foreign investment and provide a hassle-free, international competitive environment for exports. The idea was to promote exports in the country and to identify the necessity of providing a level playing field for the country’s manufacturers and enterprises to become competitive globally.
History of SEZ :
First export processing zone (EPZ) was established at Kandla in 1965, creating the Indian Special Economic Zone. Because of the failure of the early 1990s reforms to increase the Indian economy, the Special Economic Zone was created. As a result of the economic reforms introduced during the 1990s, not the desired results were obtained. During the second half of the 1990s, India’s manufacturing sector experienced a plunge in growth. Several factors resulted in the diminishing inflow of Foreign Direct Investments (FDI) into India, including long administrative procedures, rigid labor laws, and inadequate infrastructure facilities. In addition, Indian markets did not meet the maturity for Foreign Institutional Investors (FIIs) to enter the Indian economy easily. Moreover, the Indian legal framework was not strong enough to prevent the misuse of Indian markets by foreign investors. As a result, Indian industry was hindered by a lack of investor-friendly environment, despite the implementation of liberal economic policies by the central government. They had an infrastructure that was much larger and more efficient than their predecessors. In April 2000, the Special Economic Zone (SEZ) Policy was announced. The result was a much larger and more effective form of their predecessors with world-class infrastructure. As of 10th February 2006, that act and the SEZ Rules came into effect.
Quick overview about type of SEZ:
Sector-Specific SEZ :
Those who manufacture one or more items from a particular sector like gems and jewellery, electronics, or software require at least ten hectares. Those who manufacture one or more services require at least 100 hectares of production space.
Multi- Product SEZ :
Multi-product production or multi-service delivery across multiple sectors. Land that is at least 1000 hectares in size is used.
SEZ in a port or airport ; or for free trade and warehousing :
SEZ in an existing port or airport with a focus on manufacturing, including warehousing and trading. A land area of 40 hectares or more is allocated.
Setup of SEZ :
These SEZ’s are created to attract foreign investments to India. They offer world class services and facilities, such as water, electricity, roads, transportation, storage, etc. As a result of this foreign investment, our country will develop economically.
Concessions offered at SEZ Zones
Customs duty exemption on imports of capital goods, raw materials, consumables, and spare parts.
If the goods are to be used in the undertaking of authorized operations, the Central Sales Tax is exempt.
Clearance of customs in-house.
There is an abundance of technically skilled as well as semi-skilled workers in the country.
It is well connected by public transportation, local rails, and taxis.abs.
Including self certification in labor laws would simplify the process.
A zone could offer services such as water, electricity, security, restaurants, recreational facilities, and others on a purely commercial basis.
An environment free of pollution with proper drainage and sewage systems.
Disadvantages of SEZ:
Loss of revenue to government
Although the government has provided compensation, it is not equal to the loss incurred. Lands that people have worked for years to earn have to be sacrificed to private individuals. Agricultural land loss due to SEZs is more problematic as a farmer loses his livelihood and his assets. It is not easy for him to find another source of income. A labourer will have to move out of his village or work on another farm.
The tax exemptions offered by SEZs for deindustrialization appeal to industrialists from other parts of India. As a result, deindustrialization occurs in existing places and migration begins. This is not a good sign. Equal development is necessary.
Loss of agricultural land
As land grabbing is going on, there are instances that fertile agricultural lands are being taken in order to provide a way for industries. This is not only keeping agriculture at stake but also food crises may arise in the near future.
Compensatory problems
Compensation is provided by the government. However, it is not equal to the loss incurred. Lands that people have worked for years to earn have to be sacrificed to private individuals. Agricultural land loss due to SEZs is more problematic as a farmer loses his livelihood and his assets. It is not easy for him to find another source of income. In order to survive, he must work as a labourer in another farm or leave his village.
Several industrialists are interested in deindustrialization SEZs in various parts of India due to their tax exemption. Deindustrialization also results in migration. This cannot be viewed positively. The development of a country should be equally distributed.
Here we are providing you the briefing of roles of SEZ :
Provide an environment that is globally competitive
Increase foreign direct investment and gross domestic product
To increase global export share
Create employment opportunities
Develop infrastructure
Production growth in manufacturing
Please find below few SEZ of India :
Manikanchan- Gems and jewelry, West Bengal
Khopata- Multi-product, Mumbai
Sricity Pvt. Ltd., Chittoor
Salt Lake Electronic City, West Bengal
Surat Special Economic ZoneSachin, Surat
Navi Mumbai- Multi-product, Mumbai
Rajiv Gandhi Technology Park, Phase-1 Chandigarh
M/S. Apiic Ltd., Naidupeta, Nellore
SEEPZ- Andheri (East), Mumbai
To Know More
- Routine shipment, home consumption (duties paid)
- Ex-Bond/In-Bond shipment
- Shipments of DEPB, EPCG, and DFCEC licenses
- 100% EOU / STPI / SEZ / TP for ship spares / R&D certification / passbook scheme
- Import clearance for a project
- Direct deliver perishables and certain cargo
- Re-import after repairs / exhibition
- Clearance of third-country exports
- Clearance of high seas shipments
- ATA carnet clearance
- Second-hand capital goods
- Free-of-charges shipments
- Courier clearance
- Door to door delivery
- EPR and Other Certification (we follow up the concerned department on the behalf of importer and exporters)
- Bill of entry (issued by customs only)
- Commercial Invoice
- Airway bill or Bill of Lading
- Certificate of Origin
- Delivery order from shipper/airline and freight forwarder.
- The CHA requires KYC documents for customs clearance.
- License for Import (In case of particular goods)
- Certificate of Insurance (If necessary)
- Letter of Credit or LC
- Technical Write-up or Literature (Only required for specific goods)
- Industrial License (Only required for specific goods)
- Test Report (If any)
- RCMC Registration/Membership Certificate (If required)
- GATT declaration
- License for duty benefits (As an option the importer may choose): AA(DEEC)/ DFIA/ EPCG/ EOU
- And other specific documents for your goods are necessary to import customs clear in importing country.
There are certain certificates that you must obtain from the concerned departments regarding the following items:
- Registration From Food Safety and Standards Authority of India (FSSAI) (For Food/Edible Import Consignments)
- Animal Quarantine Certificate (A&Q) Required import in india (For animal, animal parts, animal feed, etc. )
- Plant and Protection Quarantine Certificate/ import permit plus Fumigation treatment Certificate are required for the import of plant material (For seeds, plant and plant thereof)
- Drug & Cosmetics Act, 1940, No-objection Certificate (NOC) from Assistant Drug Controller(ADC) (is mandatory for the import of drugs/bulk drugs, etc.)
- BIS, Bureau of Indian Standards BIS is responsible for the harmonious development of the activities of standardization, marking and quality certification of goods and for matters connected therewith or incidental thereto
- EPR, Extended Producer’s Responsibility With EPR India authorization, the manufacturer / importer of electronic and electrical products has been given the responsibility to control E-waste by the products after expiry of their lifetime.
- WPC, Wireless Planning & Coordination Imports of radio equipment into India, without prior permission from WPC, will be confiscated by Customs at point of entry.
- LMPC, Legal Metrology & Packaged Commodity Registration For import of any pre-packed commodities commodity to distribute or sell Then he need to apply for packer / manufacturer registration