Nath hopes to land 200 SEZs by FY08

KOLKATA: At a time when SEZs are a proverbial hot potato nationally, the commerce ministry has set an ambitious target of notifying 200 SEZs by FY08-end. It is also hopeful that of the 234 SEZs which have received formal clearance from the board of approvals (BoA), 70 will start functioning this fiscal. This will enable the ministry to achieve the projected Rs 67,300-crore export turnover from SEZs in 2007-08.

“Till date, we’ve notified 103 SEZs. These include 20 functional SEZs, which are generating export revenues. The ministry is confident of notifying 97 more within this fiscal,” commerce ministry sources told ET. The 103 notified SEZs have drawn a total investment of Rs 35,145 crore.

According to the SEZ Act, 2006, an SEZ takes shape in three stages. First, the state government puts forward an SEZ application to BoA for in-principle approval. Once an approval is received, the onus lies with the SEZ developer to acquire land for getting a formal approval from BoA.

“The notification deals more with technical and legal formalities. As part of the process, a development commissioner inspects the site and carries out other formalities before formally notifying the area as an SEZ. Once the zone becomes an SEZ, it starts enjoying tax concessions,” the commerce ministry official explained.

Apart from the 234 SEZs that have received formal approval, BoA has given in-principle nod to 162 zones in 17 states and one Union Territory. “Proposals have been received for 335 more SEZs. BoA will take up 40 pending applications for in-principle approval at its Thursday meeting,” sources said.

The 20-odd functional SEZs in the country have registered an aggregate export turnover of Rs 34,789.16 crore in 2006-07. This is a whopping 52.31% increase over 2005-06, when SEZs clocked an export turnover of Rs 22,839.53 crore. Leading the pack is Mumbai’s SEEPZ multi-product SEZ with a turnover of Rs 11,897 crore.

Of the 20 SEZs from which exports took place during 2006-07, five were IT/ITeS electronic hardware SEZs, such as the Wipro SEZ in West Bengal, Mahindra IT SEZ, Nokia SEZ, Flextronic SEZ and ETL Infrastructure SEZ. Exports from these SEZs amounted to Rs 2,682.15 crore. Exports from non-IT SEZs were worth Rs 32,107.01 crore.