Monday, August 19, 2013: Investors would be delighted to note that the government has notified relaxations in the minimum area requirements and simplified exit clause for developers with respect to Special Economic Zone (SEZ). This is in accordance with the announcement made by the Commerce and Industry Minister in April. So, the amendment in SEZ rules and regulations will enable SEZ developers to make an addition of one product category on each additional 50 hectares of land.
But, according to the recent norms, there is no minimum area required for IT SEZs, except a minimum built up area of 1,00,000 square meters for the top seven cities, 50,000 square meters the next 15 cities and 25,000 square meters for the rest of the cities. “The idea is to give incentives to push these IT SEZs out of the big cities and explore the less dense cities,” said a Commerce Department Official, The Economic Times reported.
While multi-product SEZ’s minimum land requirement has been reduced to 500 hectares from 1,000 hectares, the single product SEZ’s minimum land requirement has been reduced to 50 hectares from 100 hectares. Moreover, multi-services SEZs will be treated at par with single-product SEZs, where the minimum area has been slashed to half from 100 hectare.
On the other hand, SEZs meant exclusively for electronics hardware, agro-based food processing, biotechnology, handicrafts will require minimum area of 10 hectares. The best part is SEZs permit duty-free imports or domestic procurement of goods apart from offering 100 per cent income tax exemption on export income for SEZ units for the first five years.
