Current AffairsEconomics

Special Economic Zones

Special Economic Zones (SEZs) across the country has touched new heights in terms of performance in Exports, Investment and Employment.

About  SEZs

  • A Special Economic Zone (SEZ) is an area in which the business and trade laws are different from the rest of the country.
  • SEZs are located within a country’s national borders, and their aims include increasing trade balance, employment, increased investment, job creation and effective administration.
  • To encourage businesses to set up in the zone, financial policies are introduced.
  • These policies typically encompass investing, taxation, trading, quotas, customs and labour regulations.
  • Additionally, companies may be offered tax holidays, where upon establishing themselves in a zone, they are granted a period of lower taxation.
  • The performance of the SEZ units is monitored by a unit approval committee consisting of a development commissioner, custom and representative of the state government on an annual basis.

SEZs in India

  • The SEZ policy in India first came into inception on April 1, 2000.
  • The prime objective was to enhance foreign investment and provide an internationally competitive and hassle-free environment for exports.
  • The idea was to promote exports from the country and realizing the need for that a level playing field must be made available to the domestic enterprises and manufacturers to be competitive globally.
  • Subsequently, the SEZ Act 2005, was enacted to provides the umbrella legal framework, covering all important legal and regulatory aspects of SEZ development as well as for units operating in SEZs.
  • In all SEZs, the statutory functions are controlled by the government.
  • The government also controls the operation and maintenance function in the central government-controlled SEZs. The rest of the operations and maintenance are privatized.
  • Any private/public/joint sector or state government or its agencies can set up an SEZ.

Source – pib

Tags: Current Affairs, Economics

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