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SEZ rules to be tightened

Special Correspondent

To ensure developers start activity after getting clearance

NEW DELHI: The Government is planning to tighten the Special Economic Zones (SEZ) Rules to ensure developers start activity after getting clearance from the Board of Approvals (BoA) within a fixed time limit.

"We propose to make it mandatory for developers to complete all formalities for notification of their zones within six months of getting final approval, failing which their clearances will be cancelled," Commerce Secretary and BoA chairman G.K. Pillai said at an interactive session with members of the Export Promotion Council for Export Oriented Zones and Special Economic Zone Units (EPCES) here on Saturday.

Mr. Pillai said developers of about half of the 140 SEZs approved by the BoA had not come for getting their projects notified even after six months. The proposed change in the Rules could make it mandatory for the developers to seek notification within six months of the approval so that there was no speculation in real estate.

Apart from fixing a time limit for notification, the other proposed amendments in the SEZ rules were "minor" in nature. For instance, the Government proposes to extend tax benefits to sub-contractors.

The empowered Group of Ministers would consider the controversial issues of fresh land acquisition and fresh SEZs at a meeting planned on Monday, said Mr. Pillai.

The amendment to the rules would also clarify issues that have come up since the SEZ Act became operational. The Commerce Ministry was also asking states to amend the rules to ensure single window clearance for all proposals approved by the Centre.

The Government was expecting investments worth Rs. 60,000 crores and generation of eight to nine jobs by 2009.

The meeting was also attended by the EPCES chairman N.T. Vasu and director-general L.B. Singhal besides industrialists and executives involved in setting up SEZs.

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