SEZ job work, export schemes among issues discussed at stakeholder meet

Issues such as harmonisation of export promotion schemes, allowing rupee payments for services supplied to the Domestic Tariff Area, and permitting job work by units in Special Economic Zones for DTA entities without linking it to exports were discussed at a commerce ministry meeting with stakeholders on SEZ reforms here on Tuesday, an official said.

Senior commerce ministry officials, exporters and industry representatives were present at the meeting.

The industry official said that the meeting also examined the continued relevance, effectiveness, and competitiveness of the existing export promotion schemes in the present context, with emphasis on reducing procedural complexities, ensuring WTO compatibility.


"The meeting focused on the harmonisation and rationalisation of India's export promotion schemes with a view to aligning them with the evolving global trade environment, changing manufacturing practices, and the country's aspiration of becoming a leading global manufacturing and export hub," the official said.

Another industry official said that given that many SEZ units have created substantial manufacturing capacities but are operating below their potential due to subdued global demand, industry representatives urged that such units should be permitted to access the DTA by paying duties only on the imported inputs contained in the products rather than on the finished goods.

The meeting further highlighted the need to facilitate job work for the domestic market, enabling SEZ units to better utilise their idle capacities while integrating more closely with the domestic manufacturing ecosystem.

It would allow SEZ units to work as contract manufacturers or service providers for Indian companies, even if the goods are sold only in the domestic market.

Traditionally, SEZ units are meant to promote exports. Therefore, when they undertake job work for DTA companies, it is often subject to conditions related to exports.

Another issue raised was the need to permit supplies from SEZs to the domestic market against payment in Indian Rupees instead of mandating foreign exchange realisation, particularly where such supplies are made within India.

Such measures would improve capacity utilisation, strengthen domestic manufacturing, encourage investment in SEZs, and enhance their contribution to employment, exports, and India's overall industrial competitiveness, the official added.

These deliberations are important as the government has set up a 17-member committee to suggest larger reforms in the policy for these zones.

The committee will submit a concept paper recommending a roadmap for broad-based and comprehensive reforms to formulate a SEZ 2.0 policy.

The move is also important as when the SEZ law was formulated in 2005, Indian trade policy was different, and now the situation has changed due to global developments.

These zones are treated as foreign territories for laws pertaining to customs (trade and import duties), with restrictions on duty-free domestic sales.

The total exports from these zones dipped to USD 133.45 billion in 2025-26 from USD 172.07 billion in 2024-25. There are 276 operational SEZs, with 6,695 units, in the country.