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Broad consensus on SEZs

india Updated: Oct 11, 2006 16:24 IST

The Board of Approvals (BOA) headed by Commerce Secretary Gopal K Pillai cleared another 26 fresh proposals to set up SEZs, out of the 82 it considered on Tuesday.

Among those given approvals were Dr Reddy’s Labs, Hindujas, Rahejas and Mayantas. With the latest approvals, 212 SEZs have been cleared so far. Another eight SEZs were cleared "in principle".

Meanwhile, a political consensus in favour of Special Economic Zones (SEZs) seems to be emerging. BJP vice president M Venkaiah Naidu, who heads his party's recenly-formed panel of SEZs, said, "We are in favour of SEZs. But fertile agricultural land should not be used for this purpose."

The BJP has thus taken the same position that Congress president Sonia Gandhi did at the recent chief ministers conclave in Nainital. The BJP's panel final report is, however, still awaited.

Finance Minister P Chidambaram, who had earlier voiced reservations about SEZs, too appears to be coming around.

In a recent newspaper interview, he said, “I am not against SEZs, but I am against the proliferation of SEZs.” Chidambaram argued that SEZ policy should, “...act as magnet for quality infrastructure and not for those seeking tax concessions."

However, some dissenting voices on SEZs continue to be heard.

The CPM continues to oppose SEZs, maintaining that three-fourths of the land within these zones are being put at the disposal of real estate dealers. CPM leader Sitaram Yechuri has sought revision in SEZ norms to stipulate that at least 50 per cent of the land should be used for production.

Minister of State for Defence Rao Inderjit Singh too has opposed the policy saying the ground water table would be adversely impacted as SEZs consume a lot of water.

Yet, Urban Development Minister S Jaipal Reddy has taken a different line. At a real estate seminar, he said, “Farmers don’t mind foregoing their land provided they get fair prices”.  He appealed to states to make the policy of land acquisition for SEZs transparent.

Industry is clearly exasperated with the raging political debate.

“The SEZs policy is well intentioned. But, it will be very difficult to get barren land for developing a zone especially with both port and railway connectivity,” said Vasdev Loond, President of Garments Exporters Association.

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