PRESANTATION ON Special Economic zone

(SEZ) By Rahul Jagtap PGDM 1stSem

 Introduction Of SEZ
• A Special Economic Zone (SEZ) is a geographical
region that has economic laws that are more
liberal than a country's typical economic laws.
The category 'SEZ' covers a broad range of more
specific zone types, including free trade zone
(FTZ), Export Processing Zones (EPZ), Free Zones
(FZ), Industrial Estates (IE), Free Ports, Urban
Enterprise Zones and others. Usually the goal of a
structure is to increase foreign direct investment
by foreign investors, typically an international
business or a multinational corporation (MNC).
 Introduction (con,d)
• The goal of a structure is to increase foreign
direct investment by foreign investors,
typically an international business or a
multinational corporation (MNC).
• India was one of the first in Asia to recognize
the effectiveness of the Export Processing
Zone (EPZ) model in promoting exports, with
Asia's first EPZ set up in Kandla in 1965.
 Introduction (con,d)
• Considering the need to enhance foreign investment and
promote exports from the country and realising the need that
a level playing field must be made available to the domestic
enterprises and manufacturers to be competitive globally,
the Government of India in April 2000 announced the
introduction of Special Economic Zones policy in the country,
deemed to be foreign territory for the purposes of trade
operations, duties and tariffs.
• India passed special economic zone act in 2005. In India, the
government has been proactive in the development of the
SEZs. They have formulated policies, reviewed them
occasionally and have ensured that ample facilities are
provided to the developers of the SEZs as well as to the
companies setting up units in the SEZs.
 Introduction (con,d)
• Currently, India has 1022 units in operations in 9
functional SEZs, each an average size of 200 acres
(0.81 km2). 8 Export Processing Zones (EPZs) have
been converted into SEZs. These are fully
functional. All these SEZs are in various parts of the
country in the private/joint sectors or by the State
Government.
 Main objectives of the SEZ
• (a) generation of additional economic activity
(b) promotion of exports of goods and services;
(c) promotion of investment from domestic and
foreign sources;
(d) creation of employment opportunities;
(e) development of infrastructure facilities;
Incentives and facilities offered to the
SEZs
• Exemption from Central Sales Tax.
• Exemption from Service Tax.
• Single window clearance for Central and State
level approvals.
• Exemption from State sales tax and other
levies as extended by the respective State
Governments.  
 Incentives and facilities offered to the
SEZs
• Duty free import/domestic procurement of goods for
development, operation and maintenance of SEZ units
• SEZs, including foreign 100% Income Tax exemption on
export income for SEZ units under Section 10AA of the
Income Tax Act for first 5 years, 50% for next 5 years
thereafter and 50% of the ploughed back export profit
for next 5 years.
• Exemption from minimum alternate tax under section
115JB of the Income Tax Act.
• External commercial borrowing by SEZ units up to US $
500 million in a year without any maturity restriction
through recognized banking channels.
 Benefits derived from SEZs
• Benefit derived from SEZs are:-

• investment
• employment
• exports
• infrastructural development.
• Social development.
 Impact of the scheme
• The overwhelming response to the SEZ scheme is
evident from the flow of investment and creation of
additional employment in the country.
• The SEZ scheme has generated tremendous
response amongst the investors, both in India and
abroad, which is evident from the list of Developers
who have set up SEZs:
 Some of the setup present in
India
• Nokia SEZ in Tamil Nadu 
• Quark City SEZ in Chandigarh
• Flextronics SEZ in Tamil Nadu
• Mahindra World City in Tamil Nadu
• Motorola, DELL and Foxconn 
• Apache SEZ (Adidas Group) in Andhra Pradesh
• Divvy's Laboratories, Andhra Pradesh
• Rajiv Gandhi Technology Park, Chandigarh
• ETL Infrastructure IT SEZ, Chennai
• Hyderabad Gems Limited, Hyderabad
 Mundra port SEZ

Mundra Port and Special Economic Zone Limited (MPSEZ),

India’s largest private port and special economic zone.
• Mundra Special Economic Zone Limited (MSEZ) was
incorporated in November 2003, to set up an SEZ at Mundra.
MSEZ was merged with GAPL in April 2006.
• The company was renamed as Mundra Port and Special
Economic Zone Limited, to reflect the nature of business.
• Mundra Port provides cargo handling and other value-added
port services. Mundra SEZ is India’s first port-based multi-
product SEZ.
 infrastructure

• The MPSEZ offers world class infrastructure for

those who want to establish an industry in this
special economic zone
 infrastructure

• container terminal
 infrastructure
• Dry Cargo
• Handling & Storage
•

• Liquid Cargo
Handling & Storage
 infrastructure
Automobile
Export zone
 Social infrastructure
• Living

• Learning

• Recreation

• Healthcare
Other Facilities
• Safety

• IT support

• Basic needs
 connectivity

• Mundra Port is well connected to the Indian railway

network.
• The port has 7 railway sidings and two dedicated
diesel locomotives.
• It can handle double stack container trains.
• A 64 km private railway line has been developed
which connects the port with the national network.
 connectivity

• Mundra Port is about 65 km from Bhuj and 400 km

from Ahmadabad. It is easily accessible by the national
highway network (NH 8A and NH 15).  
• As NH 8A is part of the East-West Corridor of the
Golden Quadrilateral project (connecting the four
Indian metros – Mumbai, Chennai, New Delhi and
Kolkata).
 connectivity

• Mundra Port itself has a private operational airstrip

that is suitable for landing mid-size jets. The
aerodrome can be proposed to extended for
commercial operations in future.
• The nearest commercial airports to Mundra Port
are at Bhuj (65 km) and Kandla (60 km).
 Connected to Crude Line network

• Pipelines for oil & gas industry.

• Because of the distance advantage over large ports
like the ones at Mumbai, Mundra is a port of choice
for crude and other liquid cargo. Pipelines are from
mundra to panipat.
• Including the refineries of Punjab,Panipat, Bhatinda,
etc.
 Beyond Business
• The group is aware of its social and environmental
responsibilities.
• The group has given priority to education and
health. Two development indicators.
 Export revenue

Year Value (Rs. Crore) Growth Rate ( over previous

year )
2003-2004 13,854 39%

2004-2005 18,314 32%

2005-2006 22,840 25%

2006-2007 34,615 52%

2007-2008 99,500 92%

• This financial year, exports from all the SEZs

are poised to touch Rs 1,70,000 crore.
 Export revenue (con,d)
• Jamnagar SEZ exports to cross Rs 50,000 crore
Ahmadabad September 22, 2009, 0:30 IST
• Coming out of the shadows after facing a
slump in the global petrochemicals market,
Reliance Industries’ (RIL) special economic
zone (SEZ) in Jamnagar is likely to emerge as
one of the largest SEZs in the country.
Queries???
Thanks