- The government has cancelled approvals of 22 special economic zones, including that of Tamilnadu Industrial Development Corporation and True Developers, as no “satisfactory” progress was made to execute the projects.
- The decision was taken in the meeting of the Board of Approval (BoA) headed by Commerce Secretary Rajeev Kher on May 19.
- The Board examined the 22 cases of the agenda for cancellation of formal approval/notification. The Board noted that the progress made by the developer is not satisfactory.
- After deliberations, the Board decided to cancel the formal approval/notification.
However, it said the developers have to submit a certificate which will certify that they have not availed any tax/duty benefits including service tax exemptions or if availed under SEZ Act/Rules have refunded such benefits.
- Tamilnadu Industrial Development Corporation Ltd had proposed to set up a multi-product zone in Tamil Nadu and True Developers too has plans to set up IT/ITeS zone in the same state.
- Of 22 SEZs, 19 are from IT/ITeS sector, while other sectors include multi-product, engineering, hardware and software.
- In February, the government had cancelled 56 tax free enclaves.
- The BoA has also granted more time to as many as 27 special economic zone (SEZ) developers to implement their projects.
- The developers which have got more time includes Karnataka Industrial Areas Development Board, Gulf Oil Corporation, Vedanta Aluminium Ltd, Kandla Port Trust and Navi Mumbai SEZ Pvt Ltd.
- SEZs, which emerged as a major export hub in the country, started loosing sheen after imposition of minimum alternate tax (MAT) and dividend distribution tax ( DDT).
- Industry has sought a reduction or removal of these taxes to boost investments.
- Exports from these zones increased from Rs 22,840 crore in 2005-06 to Rs 4.94 lakh crore in 2013-14.
- The Commerce Ministry is struggling to increase exports as the country’s shipments in the last three years have been hovering around USD 300 billion.
Source:The Economic Times