Lok Sabha Passed the Special Economic Zones Amendment Bill

The Special Economic Zones amendment bill passed on 26th June 2019 will allow trusts to set up units in Special economic zones. This amendment bill of 2019 will replace the Special Economic Zones (Amendment) Ordinance.

This bill was became the first legislation to be passed in the newly constituted Lok Sabha session.

SEZs are special demarcated areas in the country that have different regulations to attract foreign direct investment (FDI) . Such areas are considered outside the customs territory. So far six applications to set up SEZs has been received since the passing of the ordinance.

This Image in Ordinances on Economic Sectors That Are in Force

Background & Features of the Bill

  • Special Economic Zones are entitled to various tax incentives to boost manufacturing, promote exports as well as generate employment.
  • The amendment will enable trusts to be considered for grant of permission to set up units in SEZs.
  • As per The present provisions of the SEZs Act, 2005, trusts are not permitted to set up units in SEZs.
  • Currently a person under section 2 (v) of the SEZ Act 2005 is defined as an individual whether residing in India or outside India.
  • This includes Proprietary firm, Hindu undivided family, co-operative society, company Whether incorporated in India or outside India.
  • The amendments will also provide flexibility to the central government to include in this definition of a person or any entity that the central government may notify from time to time.
  • This will facilitate investments in SEZs.
  • The government already received eight such proposals from various trusts regarding the establishment.
  • The trusts have proposed a total investment of around ₹ 8000 crore. The government expects the investments to grow further and reach upto ₹ 20,000 crore
  • Investment in SEZs was a whopping 5 lakh crore plus and the employment was over 20 lakh and exports were over ₹ 7 lakh crore.

Examrace Team at Aug 13, 2019