Finance Minister Nirmala Sitharaman in her Budget Speech proposed to replace the existing law governing SEZs with new legislation to enable states to become partners in 'Development of Enterprise and Service Hubs'.
The commerce ministry is holding consultations with all stakeholders, including states and the industry, on the proposal to replace the existing law governing special economic zones (SEZs) with new legislation, and it should take 4-6 months to come out with the final framework of the new law, Commerce and Industry Minister Piyush Goyal said on Tuesday.
Finance Minister Nirmala Sitharaman in her Budget Speech proposed to replace the existing law governing SEZs with new legislation to enable states to become partners in 'Development of Enterprise and Service Hubs'.
The existing SEZ Act was enacted in 2006 with an aim to create export hubs and boost manufacturing in the country.
Goyal said the idea behind the new law is full utilisation of all the vacant land and buildings in the SEZs and industrial parks.
"As regards the new law, we are in consultation with all the various stakeholders, states, SEZ developers and industrial parks across the country and also with the finance to see how the equalisation levy will be worked out. So, it should take 4-6 months. We can come out with the final framework of the new law governing SEZs and industrial parks," Goyal told reporters.
There are over 250 SEZs and 1,000s of industrial parks in the country, he said adding that "we should use all this infrastructure to the maximum and, therefore, we are looking at converting SEZs to somewhat a plug-and-play industrial park ecosystem".
He also said that in order to ensure the level-playing field for units in SEZ and outside these zones, "we will bring in some equalisation levy or some taxes to make it a level-playing field".
When asked whether the new law would have some tax incentive provisions, the minister said the government has been incentivising industrial parks and areas.
"I do not see any need for any further incentives... The government's effort is to provide infrastructure support and the back end connectivity and the industry is not demanding more than that," he added.
Talking about the exports target for 2022-23, he said the targets evolved after discussions with missions, industry and exporters. The $400 billion exports target for the current financial year was derived after comprehensive consultations with all the stakeholders.
"We have started that exercise for next year. But, it will come from the collective wisdom of our industry, exporters and our missions and we will soon come out with that (target) for the next year also," he said.