Mains Paper 3: Indian Economy| Effects of liberalization on the economy, changes in industrial policy and their effects on industrial growth.
From UPSC perspective, the following things are important:
Prelims level: SEZ Policy (2005)
Mains level: Reconsidering the SEZ Policy in India
Trusts can set up SEZ
- Trusts now can approach the government to set up units in special economic zones as the Cabinet has approved the promulgation of an Ordinance for amendment to the SEZ Act, 2005.
- The definition of “person” as defined in the SEZ Act would now to include trust.
- The present provisions of the Act do not permit ‘trusts’ to set up units in SEZs.
- The amendment will enable a trust to be considered for grant of permission to set up a unit in SEZs.
- The amendment would also provide flexibility to the central government to include ‘trusts’ in the definition of a ‘person’, any entity that the central government may notify from time to time.
- This will facilitate investments in SEZs.
Defining a person for SEZ
- Currently, the definition of “person” includes an individual, whether resident in India or outside India, a Hindu undivided family, co-operative society, a company, whether incorporated in India or outside India, a firm, proprietary concern, or an association of persons or body of individuals, whether incorporated or not, local authority and any agency, office or branch owned or controlled by such individual.
- SEZs are major export hubs in the country as the government provides several incentives including tax benefits and single-window clearance system.
- The developers and units of these zones enjoy certain fiscal and non-fiscal incentives such as no licence requirement for import; full freedom for subcontracting; and no routine examination by customs authorities of export/import cargo.
- They also enjoy direct and indirect tax benefits.