State prefers individual agreements over SEZs
With global economy facing threats of slowdown, the Maharashtra government feels that Special Economic Zones (SEZs), large tax-free marketing enclaves aimed at increasing exports, are no longer a viable option.mumbai Updated: Nov 18, 2011 01:18 IST
With global economy facing threats of slowdown, the Maharashtra government feels that Special Economic Zones (SEZs), large tax-free marketing enclaves aimed at increasing exports, are no longer a viable option. The focus has gradually moved from SEZs to inking individual agreements with big industrial units and investors.
“SEZs are vehicles for marketing goods to international markets. With overseas markets in the dumps, project developers are obviously moving away from this concept. It's a dynamic market and promoters are reacting to it,” said K Shivaji, principal secretary of the industries department.
According to Shivaji, the Maharashtra Industrial Devel-opment Corporation (MIDC), which promotes industry, had cancelled seven out of its proposed 29 SEZs in a single day. “I don’t think denotification or cancellation of SEZs is a bad sign. It has not affected investment in the state,” he said.
On the other hand, the industries department claims that since April, the state has got investments to the tune of Rs1.11 lakh crore through individual agreements for new projects.
A senior official from the chief minister’s office also confirmed that the government was moving away from SEZs since the global scenario was not conducive. “SEZs are affected by land acquisition issues and applicability of direct tax code, but the main reason is the current economic situation. And, we can’t change that,” said the official.