MEASURES TO REVIVE INVESTOR’s INTEREST IN SEZs
- In View of the acute difficulties in aggregating large tracts of uncultivable land for setting up SEZS, while ensuring vacancy and contiguity, it has been decided to reduce the Minimum Land Area Requirement by half. For Multi-product SEZS, it has been reduced from 1000 hectares to 500 hectares, while for sector—specific SEZs, it has been reduced from existing 100 hectares to 50 hectares.
- To provide greater flexibility in utilizing land tracts falling between 50-450 hectares, it has been decided to introduce a Graded Scale for Minimum Land Criteria which would permit a SEZ an additional sector for each continuous 50 hectare parcel of land.
- IT SEZS Sector: The present requirement of the hectares of minimum land area has been done away with. Now there would be no minimum land requirement for setting up an IT / ITES Only the minimum built up area criteria would be required to be met by the SEZ developers.
- The minimum built up area requirement has also been considerably relaxed with the requirement of one lakh square meters to be applicable for the 7 major Cities Mumbai, Delhi (NCR), Chennai, Hyderabad, Bangalore, Pune and Kolkata.
- For other Category-B cities, 50,000 square meters and for remaining cities only 25,000 square meters built up area norm will be applicable.
- The present SEZ Framework does not include an Exit Policy for the units and feedback was that this perceived as a great disadvantage. It has now been decided to permit transfer of ownership of SEZ units, including sale.
ZERO DUTY EXPORT PROMOTION CAPITAL GOODS (EPCG) SCHEME
- The EPCC scheme allows import of capital goods on zero duty for pre- production, production and post—production subject to a specific export obligation equivalent to 6 times of duty saved amount to be fulfilled in 6 years reckoned from authorization issue-date.
- This export obligation is over and above the average level of exports of same and similar products achieved by the applicant in the preceding three licensing years.
- The scheme covers manufacturer exporters, retailers, service providers as well as designated common service providers.
- The capital goods may be imported or can be sourced indigenously from a domestic manufacturer. Export obligation in this case is 90% of the prescribed export obligation.
