The Hindu Business Line : New SEZ rules evoke mixed reaction

New Delhi April 7 The new guidelines for the special economic zones (SEZs) announced by the Government have thrown up differing perceptions among developers who had planned to go in for large zones.

The new guidelines require acquisition of land by the respective real estate developer.

According to Omaxe Ltd, which had an in-principle approval for a 6,000-hectare zone in Rajasthan, the private developer may not necessarily be able to acquire a contiguous land area and this might result in bits-and-pieces development of the zone.

"When we go for acquiring land, we may not be able to purchase the entire stretch of the required size, leaving out pockets in between.

"Unless the Government helps in getting us the left out pockets, we would have to design the zone with spaces in between," said Mr Rohtas Goel, Chairman and Managing Director, Omaxe Ltd.

The Government should help the developers get those bits of land that they are not able to acquire themselves, subject to a maximum of 25 per cent of the size of the zone, suggests Mr Goel.

Another leading real estate company, DLF, however, has a different point of view. "There would be no problem in acquiring a continuous piece of land by a developer," says Mr Rajiv Talwar, Executive Director, DLF Ltd.

"The Government system is such that it may not be able to pay the market price of land and should be kept away from the process of land acquisition," he says.

There could be two contiguous zones instead of one, in conformity to the new guidelines, Mr Talwar says.

Since Omaxe's original approval is beyond the prescribed ceiling of 5,000 hectares, the company now plans to rework the strategy to develop a smaller zone, says Mr Goel.

Apart from lowering the size of the SEZ, it would also have to redraw designs for maintaining 50 per cent of the area for processing and the balance for supporting infrastructure in the proposed multi-product SEZ.

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