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G. Srinivasan

New Delhi, Dec 9 Steel Authority of India (SAIL) Salem unit’s proposal for a special economic zone (SEZ) in Tamil Nadu to manufacture steel products, the first of its kind by a public sector undertaking, would come up before the Board of Approval (BoA) for SEZs, slated to meet here on January 2.

Official sources told Business Line here that the twice-postponed BoA meeting in November and this month would have on its plate as many as 32 proposals for formal approvals and another half-a-dozen for grant of in-principle nod for the New Year’s first meeting under the Chairmanship of the Commerce Secretary, Mr Gopal K. Pillai.

They said that though several private companies have been granted approval for manufacture of other industrial products, it is for the first time that a public sector undertaking of the size and scale of SAIL’s proposal comes up before the Board.

The sources said that since the SEZ Act of 2005 and the SEZ Rules 2006 that came into force from February 10, 2006, 404 formal approvals for SEZs have been given, spread over 19 States and three Union Territories.

Another 165 in-principle approvals spread over 16 States have been granted for setting up SEZs.

They said exports from the SEZs, which were Rs 13,854 crore during 2003-04, have gone up to Rs 22,840 crore in 2005-06 and to Rs 34,789 crore in 2006-07, notching up an increase of 151 per cent in three years.

In the first half of the current fiscal, exports from SEZs amounted to Rs 25,103 crore and exports projected for the whole year from 187 SEZs (19 old plus 172 would be Rs 67,088 crore.

Even as the Government has introduced the twin Bills in Lok Sabha on Rehabilitation and Resettlement and the Land Acquisition (Amendment) on December 6, 2007 to take on board the concerns over land acquisition and the quantum of compensation for people forced out of their vocation, the sources said that land requirements in the SEZs already approved remain distinctly on low key.

They said that the total area for the proposed SEZs for which formal and in-principle approval granted is about 2,073 sq.km. as against total land of 29.73 lakh sq.km, in the country and agri land of 16.2 lakh sq.km, which works out to about 0.07 per cent of the total land area and 0.128 per cent of the total agri land.

On the land use by SEZs particularly processing and non-processing areas, the sources said that the country’s experience in the last 55 years with the industrial areas and industrial clusters was that large slums crop in the contiguous areas with the additional populace putting pressure on the municipal system.

That is why the SEZ concept recognised these deleterious effects and provided for fostering self-sustaining industrial townships so that the increased economic activity does not exert pressure on the extant infrastructure.

The onus is put on the SEZ developer for all civic amenities and infrastructure including roads, sewerage systems, open spaces, green spaces, education facilities, power, water supply and housing and they are duly compensated through tax breaks.

The sources further said that in order to regulate the use of SEZ area by the developers, the SEZ Board of Approvals would assess the size requirement of infrastructural facilities such as housing, commercial space, and recreational amenities based on the employment generation potential of the SEZs.

In the first phase, it is proposed to permit only a maximum of 25 per cent of the approved housing while the other approved infrastructure would be allowed to be created as per the developer’s plans and as approved in the Master Plan.

The balance housing would be allowed to be established by the Approval Committee in three phases depending upon the progress in allotment/occupancy of units in the processing area.

More Stories on : Infrastructure | Steel | Steel Authority of India Ltd

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