Lok Sabha Question No. 162 (UNSTARRED), answered on 2016-04-25
Subject: Concessions to Special Economic Zones
Ministry: COMMERCE AND INDUSTRY
Asked by: V. SATHYABAMA, P.R. SUNDARAM, PR. SENTHILNATHAN, C.S. PUTTARAJU

## GOVERNMENT OF INDIA MINISTRY OF COMMERCE & INDUSTRY (DEPARTMENT OF COMMERCE)

## LOK SABHA UNSTARRED QUESTION NO.162 TO BE ANSWERED ON 25 th  APRIL, 2016

## CONCESSIONS TO SPECIAL ECONOMIC ZONES

## 162.  SHRIMATI V. SATHYA BAMA:

SHRI P.R. SUNDARAM:

SHRI PR. SENTHIL NATHAN:

SHRI C.S. PUTTA RAJU:

Will the Minister of COMMERCE & INDUSTRY ( वािणÏय एवं उɮयोग मंत्री ) be pleased to state:

- (a) the details of concessions being provided/proposed to be provided by the Government to Special Economic Zones (SEZs);
- (b) whether the Government has taken any decision on Minimum Alternate Tax (MAT), Dividend Distribution Tax (DDT) and dual use of infrastructure in SEZs and if so, the details thereof and if not, the reasons therefor;
- (c) whether the exports from SEZs have declined despite withdrawal of MAT and DDT during the last three years and the current year and if so, the reasons therefor along with the remedial steps taken by the Export Promotion Council for EoUs and SEZs for enhancing exports as well as resolving issues concerning EoUs and SEZs;
- (d) whether the Government has devised policies and strategies to develop both public and public sector SEZs to promote Food Processing and Packaging sector, IT/ ITeS, Automobiles and Auto ancillaries manufacturing, Leather Sector, Electronic and Hardware and Software services and Textiles sector;
- (e) if so, the details thereof along with the results achieved in these sectors during the last five years; and
- (f) whether the Government has focussed on the improvement of quality and value of export products from SEZs in the country and if so, the details thereof, State -wise?

## ANSWER

वािणÏ य एवं उɮयोग राÏ य मंत्री ) िनमर्ला सीतारमण Įीमती ( ( èवतंत्र प्रभार )

THE MINISTER OF STATE IN THE MINISTRY OF COMMERCE AND INDUSTRY (INDEPENDENT CHARGE) (SMT. NIRMALA SITHARAMAN)

- (a) The fiscal concessions and duty benefits allowed to Special Economic Zones (SEZs) are  in-built  into  the  SEZs  Act,  2005  and  Rules  thereunder.  These  exemptions  are uniformly applicable to all SEZs and are in the nature of incentives for export and are

consistent with the principles that guide export promotion initiatives of the Government in general.

- (b) Ministry  of  Finance  has  withdrawn  the  exemption  from  Minimum  Alternate  Tax (MAT) to SEZ Developers and Units with effect from 1st April, 2012, and also the exemption of Dividend Distribution Tax (DDT) in the case of SEZ Developers under the Income-tax Act for dividends declared, distributed or paid after 1st June, 2011. In order to facilitate creation of Social & Commercial infrastructure and other facilities in Non-Processing Area (NPA) of SEZs, Government vide notification G.S.R. 5(E) dated 02.01.2015  has  allowed  dual  use  of  facilities  in  NPA  by  both  SEZ  and  non-SEZ entities.
- (c) Exports from the Special Economic Zones (SEZs) during the last three years are as under:

| Years                               | Exports (Rs. in crore)   | Growth/decline over previous year                                |
|-------------------------------------|--------------------------|------------------------------------------------------------------|
| 2013-2014                           | 4,94,077                 | 4%                                                               |
| 2014-2015                           | 4,63,770                 | -6.13%                                                           |
| 2015-2016 (April to December, 2015) | 3,41,685                 | -1.89% (corresponding period of previous financial year 2014-15) |

Export Promotion Council for EoUs and SEZs (EPCES) has been undertaking several activities  for  enhancing  exports  as  well  as  resolving  issues  concerning  EoUs  and SEZs.      During  the  year  2015-16,  a  number  of  meetings  with  Hon'ble  Minister, Commerce and Industry and Senior Officers of Department of Commerce have been held to resolve the issues concerning to SEZs.

- (d)-(e) The Government, on the basis of inputs/suggestions received from stakeholders on the policy and operational framework of the SEZ Scheme, periodically reviews the policy and operational framework of SEZs and takes necessary measures so as to facilitate speedy and effective implementation of SEZ policy. The exports from Food and Agro, IT/ITeS,  Automobiles  and  Auto  ancillaries  manufacturing,  Leather,  Footwear  and Sports  goods  Sector,  Electronic  and  Hardware  and  Software  services  and  Textiles sector SEZs during the last five years is as under:
- (f) The State-wise exports from SEZs during the last three years is at Annexure-I.

|   Sl. No. | Sector                                         |   2011-12 |   2012-13 |   2013-14 |   2014-15 |   2015-16 (as on 31.12.15) |
|-----------|------------------------------------------------|-----------|-----------|-----------|-----------|----------------------------|
|         1 | Computer/Electronic software (IT/ITeS)         |  81017.1  | 140307    | 184094    | 212349    |                  177757    |
|         2 | Automobiles and Auto ancillaries manufacturing |    761    |    849    |   1154    |   1253    |                    1720    |
|         3 | Electronics hardware                           |  20454.4  |  20936.8  |  16460.7  |   7181.65 |                    3444.82 |
|         4 | Leather, footwear and sports goods             |    516.35 |    896.96 |   1654.34 |   1343.39 |                    1708.02 |
|         5 | Food and Agro Industry                         |    729.71 |    805.95 |    880.71 |   1132.31 |                    1581.94 |
|         6 | Textiles and garments                          |   2938.08 |   4342.87 |   4213.86 |   4294.66 |                    3480.33 |

## Annexure-I to the Lok Sabha Unstarred Question No. 162 for 25 th April, 2016

| State-wise breakup of Exports from SEZs during last three years   | State-wise breakup of Exports from SEZs during last three years   | State-wise breakup of Exports from SEZs during last three years   | State-wise breakup of Exports from SEZs during last three years   | State-wise breakup of Exports from SEZs during last three years   |
|-------------------------------------------------------------------|-------------------------------------------------------------------|-------------------------------------------------------------------|-------------------------------------------------------------------|-------------------------------------------------------------------|
| Sl. No.                                                           | State                                                             | 2013-14                                                           | (Rs. 2014-15                                                      | in crore) 2015-16 (Till December 2015)                            |
| 1                                                                 | Andhra Pradesh                                                    | 33291                                                             | 7887.61                                                           | 7599.06                                                           |
| 2                                                                 | Chandigarh                                                        | 1778.15                                                           | 2084.24                                                           | 1896.38                                                           |
| 3                                                                 | Chhattisgarh                                                      | 1.84                                                              | 3.19                                                              | 0.00                                                              |
| 4                                                                 | Gujarat                                                           | 225042                                                            | 179791.75                                                         | 106568.74                                                         |
| 5                                                                 | Haryana                                                           | 8740.43                                                           | 11139.50                                                          | 10574.66                                                          |
| 6                                                                 | Karnataka                                                         | 51372.88                                                          | 55197.83                                                          | 41088.64                                                          |
| 7                                                                 | Kerala                                                            | 8003.64                                                           | 6540.20                                                           | 5213.88                                                           |
| 8                                                                 | Madhya Pradesh                                                    | 2984.23                                                           | 4009.46                                                           | 3579.48                                                           |
| 9                                                                 | Maharashtra                                                       | 56399.23                                                          | 62535.90                                                          | 51777.29                                                          |
| 10                                                                | Odisha                                                            | 386.09                                                            | 596.66                                                            | 752.03                                                            |
| 11                                                                | Punjab                                                            | 136.72                                                            | 290.79                                                            | 235.34                                                            |
| 12                                                                | Rajasthan                                                         | 2036.59                                                           | 2091.33                                                           | 1649.17                                                           |
| 13                                                                | Tamil Nadu                                                        | 71417                                                             | 68103.63                                                          | 55478.96                                                          |
| 14                                                                | Telangana                                                         | 0                                                                 | 37107.89                                                          | 32966.19                                                          |
| 15                                                                | Uttar Pradesh                                                     | 16282.42                                                          | 16516.77                                                          | 13754.51                                                          |
| 16                                                                | West Bengal                                                       | 16204.27                                                          | 9872.79                                                           | 8550.41                                                           |
|                                                                   | TOTAL                                                             | 494077                                                            | 463770                                                            | 341684.75                                                         |

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