THE SEZ"s: The Fire Continues to Burn
The Indian government has approved proposals for 180 special economic zones (SEZs) with an idea that it would invite foreign direct investment, provide jobs, and promote the development of secondary industries to service firms.
If SEZs were so beneficial then why this huge protest in many parts of the country.
For one thing, many of the approved sites are located on prime agricultural land - leading to complaints that the SEZs are more of a coordinated land grab by the rich than coordinated economic development.
Creating so many SEZs is widening the gap of inequality both in terms of individual income and national infrastructure in India.
Destruction of valuable agricultural lands is ill conceived, as farmers are not likely to make an easy transition to the jobs on offer at these SEZs.
India that way itself is not having great difficulty in getting FDI's from abroad .
To achieve the Central governments target of $10 billion a year is not difficult provided the Indian government focuses on the real impediments of FDI inflow namely outdated and inflexible labor laws and poor roads and other infrastructure.
Most observers expect FDI in India to continue to rise.
Goldman Sachs plans to invest $1 billion in real estate and infrastructure in India within another two years.
Some of the important SEZ's, which has been created so far, are as follows.
1) Surat Special Economic Zone 2) Manikanchan, Salt Lake SEZ.
3) Indore Special Economic Zone 4) Jaipur Special Economic Zone 5) Mahindra City-SEZ,Chennai 6) Salt Lake Electronic City-SEZ 7) SEEPZ Special Economic Zone .
Development Commissioner, Andheri (East) Mumbai 8) Kandla Special Economic Zone, Development Commissioner KSEZ, Gandhidham, Kachchh.
9) Cochin Special Economic Zone 10) Madras Special Economic Zone 11) Visakhapatnam Special Economic Zone 13) Falta Special Economic Zone 14) Noida Export Processing Zone A significant factor, which needs to be noted, is that all the SEZ's so far created is in the urban town areas, which already otherwise are well developed.
At many places over development of these areas has created an urban chaos so creating SEZ's here makes in no sense of the logic that SEZ's are meant for sustainable development of the economy.
As SEZ's in these areas would create further urban chaos.
Shenzhen and Pudong (near Hong Kong and Shanghai respectively) were developed as the first Special Economic Zones (SEZs) in Asia.
Now India's plans to fast-tract and focus such development into designated areas .
In India the Chinese model of development has run in serious opposition both from the political opposition as well as the common people and the intellectuals.
Critics of the proposed SEZs say that rather than promote prosperity, the zones will in fact create economic hardship because they would be built on prime agricultural land, without adequate compensation for farmers...
Others point out that the tax subsidies being offered by the government may well be challenged in the World Trade Organization, and could attract trade retaliatory measures from importing countries.
Politicians of the extreme left and right have joined with representatives of the International Monetary Fund and the head of India's Central Bank to oppose the SEZs.
Why is it that a wide section of the people are so opposed to an initiative that on paper at least provides for special export-promoting industrial areas with superior infrastructure facilities and tax concessions? The enclaves are meant to showcase the country's manufacturing prowess and its burgeoning services sector, especially its world-class enterprises in the area of information technology.
Historian Sumit Sarkar says [The SEZ policy is the] biggest land grab movement in the history of modern India.
Within the government also there seems to no uniformity on the SEZ's policy .
All this puts great pressure on Commerce and Industry Minister Kamal Nath an open advocate of SEZ's in India.
.
The Finance Minister, Palaniappan Chidambaram who has publicly stated that he fears the central government could stand to lose billions of dollars of tax revenue because of the special concessions given to firms that will operate in the SEZs.
In the 181 zones approved by September 2006 the areas range from 10 to 100 hectares.
Industries allowed 100% tax exemption on export profits for first five years and 100% foreign direct investment allowed in industries under automatic route.
Andhra Pradesh, Maharashtra, Haryana and Gujarat states lead in proposed SEZ commitments.
Mr Nath argues that new economic activity generated by the zones would more than compensate the government for revenue lost from tax-breaks.
The SEZ act was passed by parliament last year, but became controversial after the Commerce and Industry Ministry released detailed rules and guidelines.
The first export-processing zone - or free trade zone as they were earlier known - in Asia was built near the western Indian port of Kandla more than four decades ago.
But things have changed a lot since then, and the authorities say that they want to emulate the success of SEZs operating in Shenzhen and Pudong - in Hong Kong and Shanghai respectively.
Both have become huge urban agglomerations of concrete and steel, and both have generated huge amounts of cash.
Each year, exports from Shenzhen alone exceed India's total exports.
However China, which has developed only six large export-oriented industrial areas, the Indian government has approved the establishment of over 180 SEZs and many more are in the pipeline this is a dangerous trend.
With very less compensation being given to farmers, rich agricultural lands being snatched at poor market prize.
With no proper guidelines for the MNC's to follow and none of the SEZ's being developed in the rural areas the protest and controversies goes on whether in Singur of West Bengal or in Noida of U.
P, in Gurgaon of Hariyana or in Surat of Gujarat and only time will tell as to how long the fire will simmer.
If SEZs were so beneficial then why this huge protest in many parts of the country.
For one thing, many of the approved sites are located on prime agricultural land - leading to complaints that the SEZs are more of a coordinated land grab by the rich than coordinated economic development.
Creating so many SEZs is widening the gap of inequality both in terms of individual income and national infrastructure in India.
Destruction of valuable agricultural lands is ill conceived, as farmers are not likely to make an easy transition to the jobs on offer at these SEZs.
India that way itself is not having great difficulty in getting FDI's from abroad .
To achieve the Central governments target of $10 billion a year is not difficult provided the Indian government focuses on the real impediments of FDI inflow namely outdated and inflexible labor laws and poor roads and other infrastructure.
Most observers expect FDI in India to continue to rise.
Goldman Sachs plans to invest $1 billion in real estate and infrastructure in India within another two years.
Some of the important SEZ's, which has been created so far, are as follows.
1) Surat Special Economic Zone 2) Manikanchan, Salt Lake SEZ.
3) Indore Special Economic Zone 4) Jaipur Special Economic Zone 5) Mahindra City-SEZ,Chennai 6) Salt Lake Electronic City-SEZ 7) SEEPZ Special Economic Zone .
Development Commissioner, Andheri (East) Mumbai 8) Kandla Special Economic Zone, Development Commissioner KSEZ, Gandhidham, Kachchh.
9) Cochin Special Economic Zone 10) Madras Special Economic Zone 11) Visakhapatnam Special Economic Zone 13) Falta Special Economic Zone 14) Noida Export Processing Zone A significant factor, which needs to be noted, is that all the SEZ's so far created is in the urban town areas, which already otherwise are well developed.
At many places over development of these areas has created an urban chaos so creating SEZ's here makes in no sense of the logic that SEZ's are meant for sustainable development of the economy.
As SEZ's in these areas would create further urban chaos.
Shenzhen and Pudong (near Hong Kong and Shanghai respectively) were developed as the first Special Economic Zones (SEZs) in Asia.
Now India's plans to fast-tract and focus such development into designated areas .
In India the Chinese model of development has run in serious opposition both from the political opposition as well as the common people and the intellectuals.
Critics of the proposed SEZs say that rather than promote prosperity, the zones will in fact create economic hardship because they would be built on prime agricultural land, without adequate compensation for farmers...
Others point out that the tax subsidies being offered by the government may well be challenged in the World Trade Organization, and could attract trade retaliatory measures from importing countries.
Politicians of the extreme left and right have joined with representatives of the International Monetary Fund and the head of India's Central Bank to oppose the SEZs.
Why is it that a wide section of the people are so opposed to an initiative that on paper at least provides for special export-promoting industrial areas with superior infrastructure facilities and tax concessions? The enclaves are meant to showcase the country's manufacturing prowess and its burgeoning services sector, especially its world-class enterprises in the area of information technology.
Historian Sumit Sarkar says [The SEZ policy is the] biggest land grab movement in the history of modern India.
Within the government also there seems to no uniformity on the SEZ's policy .
All this puts great pressure on Commerce and Industry Minister Kamal Nath an open advocate of SEZ's in India.
.
The Finance Minister, Palaniappan Chidambaram who has publicly stated that he fears the central government could stand to lose billions of dollars of tax revenue because of the special concessions given to firms that will operate in the SEZs.
In the 181 zones approved by September 2006 the areas range from 10 to 100 hectares.
Industries allowed 100% tax exemption on export profits for first five years and 100% foreign direct investment allowed in industries under automatic route.
Andhra Pradesh, Maharashtra, Haryana and Gujarat states lead in proposed SEZ commitments.
Mr Nath argues that new economic activity generated by the zones would more than compensate the government for revenue lost from tax-breaks.
The SEZ act was passed by parliament last year, but became controversial after the Commerce and Industry Ministry released detailed rules and guidelines.
The first export-processing zone - or free trade zone as they were earlier known - in Asia was built near the western Indian port of Kandla more than four decades ago.
But things have changed a lot since then, and the authorities say that they want to emulate the success of SEZs operating in Shenzhen and Pudong - in Hong Kong and Shanghai respectively.
Both have become huge urban agglomerations of concrete and steel, and both have generated huge amounts of cash.
Each year, exports from Shenzhen alone exceed India's total exports.
However China, which has developed only six large export-oriented industrial areas, the Indian government has approved the establishment of over 180 SEZs and many more are in the pipeline this is a dangerous trend.
With very less compensation being given to farmers, rich agricultural lands being snatched at poor market prize.
With no proper guidelines for the MNC's to follow and none of the SEZ's being developed in the rural areas the protest and controversies goes on whether in Singur of West Bengal or in Noida of U.
P, in Gurgaon of Hariyana or in Surat of Gujarat and only time will tell as to how long the fire will simmer.
Source...