The Centre has constituted a group of eminent persons headed by Bharat Forge’s Baba Kalyani to study the Special Economic Zones (SEZ) policy of the country and suggest measures to make it more relevant for exporters and compatible with World Trade Organisation (WTO) norms.

The SEZ Act was passed in 2005 giving tax incentives to investors, but investments in the zone were subsequently brought under the ambit of Minimum Alternate Tax and Dividend Distribution Tax leading to a dwindling in flow of money into the SEZs.

“The group will evaluate the SEZ policy, suggest measures to cater to the needs of exporters in the present economic scenario and make the SEZ policy WTO compatible, suggest course correction in SEZ policy, make comparative analysis of the SEZ scheme and dovetail the SEZ policy with other similar schemes,” an official release circulated by the Commerce Ministry stated.

Some of the incentives offered under the SEZ policy have been challenged at the WTO by the US and may need to be replaced by other sops. The group is required to submit its recommendation in three months’ time, the release stated.

Other members of the group include Ravindra Sannareddy from Sricity SEZ, Neel Raheja from K. Raheja Group, Arun Misra from Tata Steel SEZ, Anita Arjundas from Mahindra Life Space Developer, Ajay Pandey from GIFT City SEZ, Srikanth Badiga from Hyderabad Phoenix Developer, Principal Secretaries (Industries) of Gujarat, Maharashtra, Telangana, Andhra Pradesh, Tamil Nadu & Karnataka and Commerce Department officials.

There are 223 operational SEZs in the country and the total investments made in the zones so far is ₹18,878 crore.

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