Gujarat BoardEnglish MediumSTD 12 CommerceEconomicsINDUSTRIAL SECTOR5 Marks
Question
Write a note on Special Economic Zone.
✓
Answer
$1.$ Introduction:
Special Economic Zone is known as $SEZ.$
In India at Kandala, Export Processing Zone $(EPZ)$ was started to promote export business.
It has many defects so from $1st$ April $2000$ Special Economic Zone is started.
The policy of $SEZ$ is based on China‘s successful policy in $14$ cities in $1980.$
$2.$ Objectives of $SEZ:$
$(1)$ To create additional economic activities
$(2)$ To promote the export of product and services
$(3)$ To encourage domestic and foreign investments
$(4)$ To create employment opportunities
$(5)$ To develop infrastructural facilities
$(6)$ To create control free international competitive environment for export
So that export of the country develops and production sectors becomes at par with the world.
$3.$ Characteristics of $SEZ:$
$(1)\ SEZ -$ Special Economic Zone is a fixed geographical area where business units and manufacturing units are granted.
Special facilities and economic laws are different here than Non$-SEZ$ area.
Tax relief, tax exemptions, and minimum trade control, attract foreign investors. Industries established in $SEZ$ are granted special financial packages, tax exemptions, qualitative infrastructure etc.
$(2)$ The concept of $SEZ$ in India is developed on the model of $SEZ$ of China.
It encourages export oriented units through Foreign Direct Investments.
$(3)$ In India, on $1st$ April $2000$ first policy of $SEZ$ was declared.
$(4)\ SEZ$ is a geographical area where economic laws are different.
$(4)$ China. India, Russia, North Korea, Philipins, Poland etc. have set up special economic zones.
$4.$ Special Facilities of $SEZ:$
The units set up in $SEZ$ are granted $100\%$ to tax exemption from export income.
It is exempted from central sales tax, service tax, custom duty, excise duty, etc.
All permissions to be obtained from central and states are given from single window.
Units set up in $SEZ$ are free from any labour laws.
As labour laws are not applicable to these units, all its units are announced as public utility service.
Units set up in $SEZ$ without any control can purchase product or service from anywhere in the world.
Any individual, government, joint enterprise, state government or its representative institution can set up $SEZ.$
Foreign institutions too can set up $SEZ$ in India.
All types of $SEZ$ can be controlled by government.
$5.$ Special Economic Zone in India $(SEZ):$
Eight Special Economic Zones $(SEZ)$ are setup in India.
They are as below:
$(1)$ SantaCruz $($Bombay$)\ (5)$ Vishakhapatnam $($Andhra Pradesh$)$
$(2)$ Kochin $($Kerala$)\ (6)$ Falta $($West Bengal$)$
$(3)$ Kandala and Surat $($Gujarat$)$ $(7)$ Noida $($Uttar Pradesh$)$
$(4)$ Chennai $($Tamil Nadu$)$
In addition to the above, noted areas proposal of $18\ SEZ$ are in process.
In Andhra Pradesh in India maximum number of $SEZ$ are sanctioned.
If we look sector wise approved $SEZ,$ in the sector of $IT/TES/$Electronic Hardware is semiconductor and in second number is Biotech sector.
There is difference in $SEZ$ policy of China and India.
In China $SEZ$ are promoted by government in strategic area while in India most of the $SEZ$ are promoted by private sector companies, the objective of which appears to give tax benefit.
Therefore, $SEZ$ policy has not been proved effective to increase export.
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