These investments wouldn't have been made had there been no SEZ policy? Fact is, SEZs are just govt's way of getting around its own restrictive archaic laws and regulations, especially as related to land use and labor. SEZs per se are not crucially necessary - govt could just as well allow all greenfield projects, anywhere, the same sops as those of SEZs. SEZs were successful in China because China's economy and society was totally closed, so the Manadrins created SEZs as totally contained and controlled entities, seperated from the rest of the country - tiny entreports of capitalism in a sea of strictly controlled communism.
SEZ's are creating world class townships and jobs for thousands in areas where nothing existed before. The author completely ignores the job creation aspect of SEZ's as well as the fact that many government services will be provided by private players who are likely to do a much better job. Her assumption about investment is based on a faulty premise. She assumes that 150K crore investment needs to come through FDI and ignores domestic investment. She makes a reference only to domestic corporate investment but forgets that builders/construction companies operate using money from customers.
Indians should learn to become competitive on tgheirn own and not government crutches.Any exporting unit gets same benefits be it in SEZ or in Ghatkopar Mumbai. Instead of Remote backward ares and arid land use of fertile areas is a crime.The ICOR of indian investment in such stupid schemes is very high. There is no merit in SEZs.Close this scheme immediately and set up SEZs one by one orn merits in non cultivated land.SEZs muts pay back without any tax cuts and incentives.
There is no concept of foregoing indirect taxes. Even if the unit is situated outside SEZ, Indirect Taxes are already exempted. In SEZ the process is made easier. For eg. No Central Excise, Customs or Sales Tax charged for goods used for producing exports. This is only a misnomer. Currently even EOU's are enjoying the same. If we compare the paperwork for units claiming drawback etc. the cost of transaction is easier. For example units not in EOU or SEZ has to either have advance licence [DFIA] or file draw back etc. Lots of Govt. and private manpower is wasted without any gain. To gain one rupee of drawback, Govt. wastes nearly 10 paise[i.e]110 paise and private sector another 10 paise. What is the gain? Only catch is the income tax. This is not exempted for other exports leading to differential taxes. Vatable duties like excise, sales are not paid by any industry. Rather the final consumer bears it as he cannot pass on duty. Finally, there is no loss in indirect taxes due to SEZ as already the same is enjoyed by other exporting units. Only the direct taxes is the differential duty. This will clarify all
SEZs should be compared with the profits they are going to accrue, and the way these can be passed on to the needy (unemployed skilled and unskilled workers and various service providers). There should be a mechanism for products manufactured outside SEZs and in SEZs to be at par. The present SEZ proposals are very much in favour of the developers. May be these will deprive the citizens living in the nearby area of proposed SEZ of the basic facilities they are getting like drinking water and electricity. Law and order in the SEZs is also a point of major concern in these days of terrorism and Khandani as the proposal prevents any state or central forces to intervene. Experts should throw more light on it.
SEZ is defintely a boom to economy if it implemented wiht a time bound and committed programme. In addtion to IT, export oreinted items metc., I suggest 30 % of the SEZ land area should be allocated for development and production of Agriculture organic produce mainly for Export purpose. This includes cotton, rice, wheat, pulses, fruits and ofcourse the mangoes ; the new delicacy of Westerners. It will not only earn Foreign excgange, but also will give employment to the displaced rural farmers whose land will be acquired for SEZ. Our Ministers and MPs shall give a serious thought to my suggestion to solve the Nandigram and other SEZ disputes. Jay
SEZs are surely drains and not gains. This is not new scheme. In 80s government set up many EPZs and other special areas like science parks, FTZs etc which are more or less flop except may be SEEPZ. That too because of jewellery units allowed there. In my view these schemes are meaningless ,specially those which are not on coastal areas. It is only property grabbing and real estate scams. Converting agricultural land is highly criminal act to reduce fertile land available for profits by big industrial houses in connivance with politicians and babus and should be severely punished. People of India should not watch quietly and helplessly. Protest and take politicians and babies to task. They have taken India to ransom in last 16 years in name of liberalisation. Yes India is truly liberated .Liberated to loot and plunder common man's money. Enjoy luxuries and spend and squander public money.SEZs are only useful in coastal areas and in non agricultural land.Period!
RE:SEZs- A fraudulent scheme
by Sameer Bhagwat on Sep 10, 2007 06:43 AM Permalink
SEZ's are not the same as EPZ. An SEZ has most of government services and infrastructure being provided by private players. Why exactly is building an SEZ on fertile land a criminal act? If the SEZ is able to generate several crores per acre as taxes is it not better than a few thousand rupees which can be had by agriculture? The so called innocent farmers are themselves land grabbers in the first place as they were given that land by grabbing from landlords in the 50's and 60's. Also they are getting compensated for their land. How can call that grabbing?
