SEZ MAIN 123.ppt

8/9/2019 SEZ MAIN 123.ppt

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Presented By:

Shudodhani Sharma

Deepika Malhotra

SEZ The Next Frontier For IndiaSEZ The Next Frontier For India


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SPECIAL ECONOMIC

ZONES IN INDIA


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INTE!Template

"#er#ie$

Meaning of SEZ & AssociatedTerms

SEZs in India

Difference between SEZ &EPZ

SEZ ACT,!!"

#eat$res of SEZ

SEZ Polic% b'ecti(es

SEZ #ormats

)e% Sta*e+olders Incenti(es to boost SEZ

de(elopment

Ad(antages of de(elopment

of SEZ nits

-+o can set $p SEZ

Implementation of SEZ

Polic% Ma'or Economic Zones in

India

State.s S+are in /otified

SEZs

0eg$lator% #ramewor* SEZ and E1port Promotion

SMMA02


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SEZs


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INTE!Template

!3Special Economic Zones

A Spe%ial E%onomi% Zone4SEZ5 is defined as a

deemed &orei'n territorywit+in a co$ntr% wit+

special r$les for facilitating #DI for e1port6oriented

prod$ction, and for p$rposes of trade operations andc$stom d$ties and tariffs7

It is a specificall% delineated d$t% free encla(e

SEZ is basicall% a specified geograp+ical regiont+at +as economic laws t+at are more liberal t+an a

co$ntr%8s t%pical economic laws7


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/o*ia SEZ Comple1 in Tamil /ad$


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INTE!Template!9 Domestic Tariff Area

-Domestic Tariff Area is an area wit+in India b$tw+ic+ is o$tside t+e Special Economic Zone7

6T+e 0nitsoperating $nder certain specificsc+emes s$c+ as EPZ2SEZ2E"0are e1pected tocarr%o$t t+eir acti(ities wit+in c$stoms bonded area7T+e area w+ic+ is not coming $nder t+e '$risdictionof c$stom bonded are called Domestic Tariff Area7


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INTE!Template

!:Domestic Tariff Area

;oods going in to SEZ from DomesticTariff Area 4DTA5 are treated as physi%alexports1

T+ose coming o$t of SEZ to DTA aretreated as if imported &rom other%ountries, for all trading operations7

Ta*ing goods into and o$t of SEZ aremostl% done wit+ minimal C$stomss$per(ision and paper wor*, and on self6certification7


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INTE!Template!"

Processing Area

Processing Area is t+e demarcated

area w+ere $nits can be located forman$fact$re of goods or rendering

of ser(ices7


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INTE!Template

!< /on6 Processing Area

/on6processing area is intended to

pro(ide s$pport infrastr$ct$re in terms

of =SPP0T #ACI>ITIES? to SEZ

processing area and ma% incl$de

commercial and social infrastr$ct$re7


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INTE!Template

!@ Special Economic Zones in India

Number of Special Economic Zones in Indiahas increased overthe last few years.

In India, Special Economic Zones are being set up in many statesof the country due to the efforts that are being undertaen by theIndian government.

!he implementation of the first drafted SEZ policy statement too

place from the end of the year "###.

It was drafted as a five-year pro$ect, starting from %.%%."### to

#&.#"."##'.

(urther, the first policy statement of the Indian Special EconomicZones were amended to accommodate and compliment the growthattained.


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INTE!Template!Bow SEZs are different from EPZ

!estri%tion on Se%tors:SEZ is open to all

man$fact$ring, ser(ices & trading acti(ities w+ereas

EPZ foc$ses onl% on man$fact$ring & trading7

Tax Exemption:SEZs en'o% a " %ear ta1 +olida%

followed b% "! e1emption for more %ears w+ic+ is

not t+e case wit+ EPZ7

DT3 4 Sales:#or SEZ $nlimited DTA Sales are

allowed on f$ll d$t% b$t incase of EPZ onl% "!e1ports $alif% for DTA Sales7 T+$s SEZ en'o% greater

access to domestic mar*et7


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INTE!Template5o$ SEZs are di&&erent &rom EPZ

!etention o& Forei'n Ex%han'e Earnin's:

SEZ nits can retain 3!! foreign c$rrenc%

earnings in E1c+ange Earner #oreign C$rrenc%

Acco$nt 4EE#C5 b$t EPZ.s allow onl% @! to

retain7

T+is gi(es companies in SEZ better control o(er

foreign c$rrenc% in relation to p$rc+ase of imported

inp$ts7


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INTE!Template5o$ SEZs are di&&erent &rom EPZ

Export Per&orman%e !e6uirements:

/o minim$m e1port performancere$ired in terms of Net Forei'n

Ex%han'e Earnin' as 7 o& Exports

.NFEP/for SEZ s b$t for EPZs it isre$ired7

!


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INTE!Template -+o is a trader F

6Traders are persons w+o trade in

goods & ser(ices man$fact$red

b% companies operating in SEZ$nits7

6T+e% deal in e1ports & imports7

3!


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INTE!Template

33-+at is EE#C

Ex%han'e Earners* Forei'n

8urren%y 3%%ount .EEF8/:

It is an acco$nt maintained in

foreign c$rrenc% wit+ an A$t+oriGed

Dealer, i7e7 a ban* dealing in foreigne1c+ange7

5i t & F ti & SEZ i


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INTE!Template

3 5istory o& Formation o& SEZs in

India

Seeds o& the +asi% %on%ept o& SEZ $ere so$n in the mid

sixties

Export Pro%essin' Zones: Basi% model o& the present day

Indian SEZ $as stru%tured $ith the esta+lishment o& the&irst Export Pro%essin' Zone .EPZ/ at 9andla in the year

;s pa#ed $ay &or modern

day SEZs

SEZ poli%y o& India $as de#ised to a%t as a %atalystto promote the e%onomi% 'ro$th attained in the early

;;( +ut it did not produ%e the desired results1


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INTE!Template

39 MAI/ P0H>EMS

?a%k o& @ood E%onomi%Poli%y A ine&&i%ientmana'ement

+e%ame detrimental &a%tors&or EPZs

!ed tape- len'thyadministrati#e pro%edures-ri'id la+or la$s A poorphysi%al in&rastru%tural&a%ilities: main %ause o&deterioration o& FDI in&lo$

into India1

Indian markets $ere notmature enou'h to &a%ilitateeasy entry o& FIIs into theIndian e%onomi% system1

The le'al &rame$ork o&

Indian e%onomy $as notstron' enou'h to pre#entmisuse o& Indian markets+y the &orei'n in#estors1

Thus, the lack of investor friendly environment in India

prevented growth of Indian industry, in spite of implementation of

liberal economic policy by the central government.


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INTE!Template

5istory o& Formation o& SEZs inIndia

T+ese problems res$lted in t+e formation of a m$c+ larger andmore efficient form of t+eir predecessors wit+ world6classinfrastr$ct$ral facilit%7

T+e modern da% SEZ came into e1istence beca$se t+e economicreforms incorporated in t+e earl% 3!s did not res$lted in t+e o(erall

growt+ of t+e Indian econom%7

T+e Bistor% of SEZs in India s$ggests t+at t+e present da% SEZpolicies of India are well complimented b% t+e pro(isions of t+e Actsand 0$les of SEZ7

*The Spe%ial E%onomi% Zones 3%t- )((=C $as then &ormulated1

T+e SEZ Act, !!" and SEZ 0$les became effecti(e from 3!t+

#ebr$ar% !!


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INTE!Template

3"SEZ ACT !!"

The SEZ 3%t )((= de&ines the key role &or theState @o#ernments in Export Promotion and

%reation o& in&rastru%tural &a%ilities1

3 Sin'le indo$ SEZ appro#al me%hanism has+een &a%ilitated throu'h a ; mem+er inter

ministerial SEZ Board o& 3ppro#al or B"31 3ndthe de%ision o& the SEZ Board o& 3ppro#al is

+indin' and &inal1


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SEZ 38T-)((=

Enacted to

gi(e boost to

EC/MIC;0-TB

Triggered

#oreign &

Domestic

In(estment in

SEZ

Special #iscal

Incenti(es

were introd$ced

for

entreprene$rs

& de(elopers


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INTE!Template

3and ma% be allotted for de(elopment of

infrastr$ct$re facilities for $se b% $nits6 specific

appro(al ma% be obtained for lease of land for

creation of facilities s$c+ as canteen, PCs,

first aid centres, crec+e, etc7 for e1cl$si(e $se of$nit7

nl% a$t+oriGed persons wit+ identit% cards

permitted to enter processing area7

/o (acant land in non6processing area will be

a(ailable for b$siness & social p$rposes7


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INTE!Template

@

E1port polic% of India was eased b% ;o(t7 of India to facilitateeas% growt+ of SEZ and E1port Promotion of Indian goodsacross international destinations7

T+is led to t+e de(elopment of special *ind of $nits wit+in t+edesignated Special Economic Zones7

T+ese specialiGed e1port oriented $nits were called E1portriented nits or E and t+e% were created to increase t+eo(erall e1port potential of t+ese SEZ7

#$rt+er, t+ese E were de(ised in s$c+ a wa%, so t+at t+e%can foc$s specificall% on t+e growt+ of Indian e1ports7

SEZ % E&port "romotion


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INTE!Template

6T+e recipient of goods e1ported b% t+ese e1port oriented

$nits allows t+em to sell t+eir prod$cts in t+e domestic mar*ets

in case of re'ection b% t+em, after pa%ment of designated ta1

and wit+in t+e direct tariff area7 nl% some e1cl$si(e

commodities are barred from s$c+ selling process7

6E1emption on d$ties on Indian capital goods and inp$ts

6Preferential treatment of t+ese $nits to t+e Indian mar*et for

eas% dissemination of t+eir prod$cts and K or ser(ice

SEZ % E&port "romotion


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INTE!TemplateTrend in E1port Performance of SEZ


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SEZ Exports as 7 share o& Total Exports in India


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S0MMIN@ 0P

SEZs a ta1 efficient option for De(eloper and nits7SEZs a ta1 efficient option for De(eloper and nits7

Hesides direct ta1ation benefits, indirect benefitsHesides direct ta1ation benefits, indirect benefits

contrib$te to low cost of doing b$siness and ens$recontrib$te to low cost of doing b$siness and ens$re

SEZs as profitable in(estment destinations7SEZs as profitable in(estment destinations7

Pro(ides widespread opport$nities in differentPro(ides widespread opport$nities in different

location in di(erse sectors in(ol(ing a w+ole range oflocation in di(erse sectors in(ol(ing a w+ole range of

primar% and secondar% acti(ities in man$fact$ring,primar% and secondar% acti(ities in man$fact$ring,

trading and ser(ice acti(ities7trading and ser(ice acti(ities7

T+e SEZ Act embodies strategic positioning of ZonesT+e SEZ Act embodies strategic positioning of Zones

in t+e international mar*ets b% le(eraging onin t+e international mar*ets b% le(eraging on

lin*ages wit+ +interlandKDomestic Tariff Area t+ro$g+lin*ages wit+ +interlandKDomestic Tariff Area t+ro$g+

establis+ment of world class infrastr$ct$re andestablis+ment of world class infrastr$ct$re and

pro(iding economic benefits7pro(iding economic benefits7


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