EXPORT ASSISTANCE : SPECIAL ECONOMIC ZONE (SEZ)

        India was the first to identify the importance of EPZ in promoting exports. The first EPZ was setup in KANDALA in 1965. In 2000, SEZs policy was formed in order to overcome difficulties faced on account of the multiplicity of controls and clearance , Lack of fine class infrastructure and to canalize the inflow of foreign investment in India. The SEZ Act , 2005 was an important bill passed by the Government of India to gain confidence of investors and stabilize SEZ regime , which creates scope for economic activity and employment opportunities . Minister of Commerce and Industry as well as senior officials organised number of meetings for this purpose. The SEZ Act was passed by parliament in May 2005 and approved by President on 23rd June 2005. After extensive consultations , the SEZ Act , 2005 supported by SEZ Rules , came into effect on 10th February 2006, providing for drastic simplification of procedures and for single window clearance on matters relating to central as well as state government.

           SEZ encourages economic growth and industrial growth of a company. It is a specified region in a state that has it liberal economic law in comparison to the typical economic laws. Units established under , it enjoy various advantages like do not require license for importing goods , they do not have to py Central Excise Duty when they acquire raw material , spares and capital goods from the market.

FEATURES AND FACILITIES OF INDIAN SEZ

    1. Units established under SEZ do not have to pay custom duty and 100% exemption from income tax.

     2. Units are allowed 100% FDI.

     3. For the units within the SEZ , there are no fixed norms for wastage.

     4. Complete freedom to hire contract labours and involved in sub contracting.

     5. No strict supervision by customs on Import and Export.

     6. Units does not require separate documentation to EXIM and custom policy.

     7. Unit's performance is supervised by the development commissioner.

     8. The sales tax which is being paid by units on purchase of domestic products are returned.

OBJECTIVES OF SETTING SEZ 

    The main objectives of setting up of Special Economic Zones in India are as follows :

      1. Generation of additional economic activity .

      2. Promotion of exports of goods and services .

      3. Promotion of investment from domestic and foreign sources.

      4. Creation of employment.

      5. Development of infrastructure facilities.

      6. Single window clearance for setting up of a SEZ and a unit in SEZ.

      7. Single window clearance on matters relating to Central as well as State Government.

      8. Easy and simplified compliance procedures and documentation with stress on self certification.

ADVANTAGES OF SEZ UNITS IN INDIA 

    1. Capital goods used for project development for the purpose of domestic inquiry are tax free.

    2. There is no restriction on foreign ownership in developing zones infrastructure as well as no restriction on repatriation.

    3. It is free to develop the SEZ with residential areas, markets and playgrounds . Clubs and recreation centers without any restrictions on foreign ownership.

    4. Concession in taxes on business income.

    5. There is no obligation to pay import duty/VAT and other taxes.

    6. Through the automatic route 10% FDI was allowed for all the manufacturing activities.

    7. In house customs clearance facilities.

    8. Easy access to airport and local Railway Station.

    9. Supply of technically skilled manpower is abundant.

    10. Supply of semi skilled labour across all industry sectors are abundant.

THANKING YOU.