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Our Bureau

Kolkata , Sept 21

THE country's first free trade warehousing zone at Haldia in West Bengal, which has already received in-principle clearance from the Centre, is a joint venture between IL&FS and MMTC, and will entail an initial investment of Rs 200 crore.

Talking to newspersons here today at the sidelines of an Open House meet organised by the Export Promotion Council for EOUs & SEZ Units (EPCES) units, Mr G.K. Pillai, Additional Secretary, Union Ministry of Commerce, said it was likely to come into operation by the middle of 2006.

Describing it as a unique joint venture with equity investment in the ratio of 51:49 (IL&FS and MMTC respectively), Mr Pillai said imports of items of use for Indian industry would become much easier, once such an international bonded warehouse within the free trade ambit comes up in the country, minimizing the urgent consignments which now need to come from Singapore.

He, however, said it was too early to comment on what kind of international model would be adopted by the IL&FS-MMTC joint venture.

He said the Haldia Warehousing Zone was expected to come up in a 30-acre area. Ideally, the two-member joint venture should be having a third international partner, who will handle the logistics part, which was critical to the success of such an enterprise.

Describing The Special Economic Zones Act, 2005, as the best thing that has happened to India's Exim sector, he said some 62 SEZ applications have been cleared by the Board of Approvals so far, including 14 new ones.

These new SEZs alone would involve an investment of Rs 60,000 crore in the next three years, and are expected to create 1 lakh new jobs. He expected the Draft Rules of the Act, now being vetted by the Law Ministry, to be notified by either end October or early November.

Among the big industry houses that have shown interest in setting up such zones are the two Ambani combines, one in Jamnagar, Gujarat (Mukesh's group) and another in Dadra (Anil), besides IT zones by companies such as Wipro (West Bengal), Hewlett-Packard and Nokia (Tamil Nadu and Noida). Two new SEZs are also expected in Visakhapatnam and Kakinada in Andhra Pradesh.

Earlier, in his welcome address, Mr Sharad Jaipuria, Chairman of EPCES, said a major issue for the EOUs now was immediate removal of the Sunset clause under Section 10B of the Income-Tax Act, so that EOUs may avail the benefit of tax exemption beyond 2009.

He also sought exemption for EOUs from service tax and Central sales tax.

He said exports by the EOU-SEZ sector during 2004-05 was to the tune of Rs 50,228 crore , which amounted to 14.06 per cent of India's total exports. Exports from EOUs was Rs 32,075 crore and from SEZ units Rs 18,153 crore.

Describing the SEZ Act as a highly innovative and flexible, Mr Jaipuria said the primary intention was to provide a hassle-free regulatory regime and simplified procedures for boosting India's foreign trade.

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Free trade warehousing zone planned at Haldia

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