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Govt to go slow on IT SEZs

So far 148 IT SEZs have been given formal clearance and 70 in-principle approval, reports HT Correspondent.

india Updated: Nov 08, 2006 21:08 IST

The government will "go slow" in giving approval to information technology (IT) specific special economic zones (SEZs), the Commerce Secretary GK Pillai declared on Wednesday.

"The Left parties have demanded a cap on IT SEZs. We are not putting a cap, but the Board of Approvals has decided not to give more in-principle approvals. We will go slow for the time being," said Pillai said at a seminar organised by the Associated chambers of commerce and industry of India (Assocham).

The BoA has given formal clearance to 148 IT SEZs and in-principle approval to 70 more SEZs so far.

"We are probably reaching the limit (on IT SEZs)... We need to debate that. Moreover, all these zones may not come up, about 25 per cent may drop out," he added.

IT major Hewlett-Packard recently surrendered the formal approval it had obtained for its proposed IT zone near Bangalore.

"We are adopting a wait and watch policy. After six months to one year, we will see how many actually come up," said Pillai.

CPI national secretary D Raja, who also addressed the seminar, opposed approvals for setting up of SEZs under the existing state Land Acquisition Acts. He wanted legislation to ensure that states follow a central model for establishing future SEZs where agriculture land was not acquired and farmers were not displaced.

The model law should have provisions such that only barren, wasteful and unproductive land was acquired to set up future SEZs with a sectoral cap on them, he said .

Raja also called for a sectoral cap on SEZs. The IT SEZs approved so far are spread over an area of 125 million square feet of built up space and are projected to create 12.5 lakh additional jobs in the next 2-3 years.

Pillai, however, made it clear there was no proposal to fix any cap on sector-specific or multi-product SEZs.

The BoA had earlier given clearance for 237 SEZs of which 41 have been notified with an investment of over Rs. 5000 crore. The Board has also given and in principle clearance for additional 166 SEZs for which various groundwork was being undertaken by their developers, said Pillai.

First Published: Nov 08, 2006 21:08 IST