There could be some relief in the offing for special economic zone (SEZ) developers.
There could be some relief in the offing for special economic zone (SEZ) developers. The Finance Ministry has agreed to re-look into some of the proposals the Commerce Ministry had mooted after the intervention of Anand Sharma. Sharma met officials of the revenue department to revitalise the SEZ schemes on Tuesday, reports CNBC-TV18's Ronojoy Banerjee quoting sources.
The FinMin had opposed atleast eight proposals that the commerce ministry made to revitalise the SEZ sector. However, on Tuesday, after Commerce Minister Anand Sharma held a meeting with revenue department officials, the finance ministry has now agreed to relook into them only if Finance Minister, P Chidambaram agrees to the proposal.
According to sources, there would be atleast three key proposals that the finance ministry is likely to relook into. One of them is the minimum land requirement for the multi-product SEZs, which currently stands at 1,000 hectors. This, the commerce ministry wants to reduce to 250 hectors.
This is apart from reducing the sector specific land requirement for SEZs from 100 hectors to 40 hectors. Earlier the finance ministry had objected to it by saying that according to their study, only 10 percent of the approved SEZ areas were actually in use. Therefore, they felt there was no reason to reduce the land requirements.
Apart from that, sources say that with respect to IT SEZs, the finance ministry has agreed to relook into the possibility of replacing the minimum land requirement with the clause of minimum construction area. This is going to give a big boost to SEZs because then, they will be able to build their SEZs vertically and not necessarily horizontally which will require acquiring more lands.
The other big thing is, the commerce ministry had asked finance ministry to look at the viability of allowing sale or transfer of ownership of SEZ units from one player to the other. This again the finance ministry said would defeat the very purpose of the SEZ policy. That is another contentious issue which the Finance Ministry is likely to relook into.
The finance ministry had earlier indicated that they may look into it, but there was little respite for the SEZ. This time, however, commerce ministry officials are hopeful.