Press Information Bureau

Government of India 

Ministry of Commerce & Industry

19-December, 2012 16:52 IST

The areas falling within the Special Economic Zones are demarcated as the processing area for setting up Units for activities, being the manufacture of goods, or rendering services; or the area exclusively for trading or warehousing purposes; or the non-processing areas for activities other than those specified under the above two area categories. Under the SEZ Policy at least fifty per cent of the SEZ area is to be earmarked for developing the processing area of the SEZ. The quantum of various authorised activities for creation of social, commercial and industrial infrastructure including residential housing, commercial area, hospitals, educational institutions etc in the SEZ are decided by the Board of Approval after an assessment of the functional requirement of the SEZ.

Fiscal benefits provided to SEZ developers and units for processing and non-processing area, in the form of concessions, rebates and exemptions are intrinsic to the SEZ policy and are provided under the SEZ Act, 2005 and the SEZ Rules, 2006 made thereunder. The fiscal incentives available in the processing area of a SEZ and that available in the non-processing area of the SEZ may differ owing to the fact that units can be set up only in the processing area of SEZ and not in the non processing area, certain infrastructure is set up in the non processing area and not in the processing area etc.

This information was given by the Minister of State for Commerce & Industry Dr. D. Purandeswari in written reply to a question in Rajya Sabha today.

 

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DS/RK

 

SEZ processing area requirement defines land allocation and differing fiscal incentives between processing and non-processing zones. Special Economic Zones are divided into processing, exclusive trading/warehousing, and non-processing areas; the Board of Approval authorises land allocation and permitted infrastructure uses, while fiscal concessions under SEZ legislation differ between processing and non-processing areas because units can be established only in processing areas.