This Article is From Jul 16, 2014

Government Set to Cancel Approvals of 43 SEZ Developers

New Delhi: The Development Commissioners of special economic zones (SEZs) have recommended cancellation of 'formal approval' granted to as many as 43 SEZ developers, including Reliance Infocom Infrastructure and Emaar MGF Land.

The final decision regarding cancellations of approvals will be taken by the board of approval, a 19-member inter-ministerial body headed by Commerce Secretary Rajeev Kher, in its meeting on July 24.

In all these 43 cases, the board had granted formal approvals.

"However, since there is no significant progress made by the Developer, the concerned DC (Development Commissioner) has proposed for cancellation of formal approval granted to the Developer," the Commerce Ministry said.

As per rules, formal approval is valid for a period of three years by which time at least one unit has to commence production and the SEZ becomes operational from the date of commencement of such production. Provision to this rule provides for extension of the formal approvals by the board of approval.

The others SEZ developers which are facing the axe include GVK Perambalur SEZ, Deccan Infrastructure and Land Holdings, Essel Infraprojects, Jindal Photo Ltd, Rajiv Gandhi IT Park Co-op Society, SAIL Salem SEZ and Tamil Nadu Industrial Development Corporation.

SEZs are mainly export hubs which enjoy certain tax benefits.

Of the 566 formally approved SEZs, only 185 are in operation. Exports from these zones increased from Rs 22,840 crore in 2005-06 to Rs 4.94 lakh crore in 2013-14.