The Telegraph
Since 1st March, 1999
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SEZ land wrangle put to rest

New Delhi, June 6: The controversy over the minimum land required for special economic zones in infotech, gems and jewellery and biotech was resolved today with the empowered group of ministers (EGoM) retaining the commerce ministry’s original proposal of a minimum 10 hectares for setting up such zones.

The meeting was convened to resolve the differences between the ministries of finance and commerce on this issue.

According to an official statement, the EGoM has retained the minimum land area requirement of 10 hectares and built-up area of one lakh square metres for infotech SEZs. It is the same as notified in the SEZ rules by the commerce ministry.

SEZs for gems and jewellery would require a minimum area of 10 hectares and 50,000 square metres of built-up area.

The zones for biotech and non-conventional energy would also require a minimum area of 10 hectares and 40,000 square metres of built-up area.

The controversy had cropped up as the finance ministry wanted the minimum area to be 25 hectares for such SEZs. The ministry feared a revenue leakage if the plot was reduced.

Following this, an EGoM headed by defence minister Pranab Mukherjee was set up to resolve the issue. The other members were commerce minister Kamal Nath, finance minister P. Chidambaram, IT and communications minister Dayanidhi Maran, law minister H.R. Bharadwaj and Planning Commission deputy chairman Montek Singh Ahluwalia.

For all other multi-product, multi-services and sector-specific zones, the land area requirement would remain the same as notified in the SEZ rules.

The commerce ministry has stipulated 1,000 hectares for multi-product SEZs and 100 hectares for multi-services and sector-specific SEZs. There was no dispute between the two ministries over these zones. The EGoM also said the processing area in SEZs would be 35 per cent.

Nath said the SEZs are expected to attract an investment of Rs 100,000 crore over three years.

“Till now, 15 functioning SEZs with an average size of 200 acres have attracted private investment of about Rs 2,200 crore for establishing units. They are expected to provide employment to about 1.10 lakh people,” he added.

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