Special Economic Zone- In Indian Context
Special Economic Zone is a buzzword and has come to be regarded as an instrument to add pace to our drives for faster economic development . As we have controversies on every issue the question of establishment of SEZ too is embroiled in a lot of controversies. Our big neighbour has very spectacularly experimented with this concept and has set a large number os such SEZs in different parts. of the country. Now let us examine the features which makes a SEZ so unique.
The SEZs are viewed for all practical purposes as foreign enclaves for tax purposes and treated under a special fiscal and regulatory regime. The SEZ is intended to provide a single window mechanism in the form of an integrated infrastructure . It can observed that SEZs are basically considered as avenues to develop our export market and help the exporters to price their products efficiently so that they can position themselves price-wise in overseas market which experience intense competition. The prices of our products in the domestic market suffer from the incidence of various taxes which make them uncompetitive. And the units which are established in the Special Economic Zones are freed from these taxes and thereby gain competitiveness which is very vital in the international market.
One of the main problems which has dogged the SEZs in India has been the availability of land. As SEZs require vast land to set up a cluster of ancillary units which ensure steady supplies of finished and semi-finished inputs, it has given birth to a host of problems. The land acquisition has become a big headache for the promoters of SEZs. And the methods adopted by some private promoters to acquire farm lands have come under a cloud. Similarly the adequacy of compensation awarded to the owners has become a vexed issue.
With all the controversies surrounding the Special Economic Zones, these have achieved a modest success in India. The number of SEZs which have come up in different parts of the country has succeeded in generating additional economic activity , promoting export of goods and services and in creating employment opportunities.
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