ep zs, eous, tps & sezs 6
DESCRIPTION
SEZTRANSCRIPT
EPZs, EOUs, TPs & SEZs
By Prof. Neha Patel
(c) Prof. Neha Patel,GLS MBA Programs
Export Processing Zones (EPZs)
• Industrial estates which form enclaves of national territory
• Are usually near port
• The entire production of this zone is exported• Tax incentives available• Speedy import and export transactions• Govt. has permitted development of EPZ by
private sector, State, or joint
(c) Prof. Neha Patel,GLS MBA Programs
Other Zones
• EPIP – Export promotion Industrial Park Scene
• EOU – Export Oriented Unit
(c) Prof. Neha Patel,GLS MBA Programs
EPZ in India
• Kandla Free Trade Zone, Gujarat• Santa Cruz Electronic Export Processing Zone
(SEEPZ), Mumbai• Noida Export Processing Zone, UP• Madras Export Processing Zones, Chennai• Cochin Export Processing Zone, Kerala• Falta Export Processing Zone, West Bengal• Visakhapatnam Export Processing Zone
(c) Prof. Neha Patel,GLS MBA Programs
Contribution of EPZs to Industrial growth/diversification : A qualitative analysis
At the sector level •Contribution to technology transfer &spill over's •Development of Local entrepreneurship : Gems and Jewellery, Electronics, SW, rubber gloves
Regional development•Contribution to employment,
•Income generation•Ancillary industrial activities
•Most notable : Kandla, Noida
NationalContribution
to exports, employment
(c) Prof. N
eha Patel,G
LS M
BA
P
rogram
s
Export Oriented Units [EOUs]
• Units undertaking to export their entire production of goods and services – Except permissible sales in Domestic Tariff Area (DTA)
• Electronic Hardware Technology Parks (EHTPs), Software Technology Parks (STPs) or Bio-Technology Parks (BTPs) – Also covered under EOU scheme. – These are product specific units availing the same benefits as
EOUs.
• EOUs are allowed to manufacture goods including– repair, re-making, reconditioning, reengineering, and rendering
of services wherever applicable.
(c) Prof. Neha Patel,GLS MBA Programs
Software Technology Parks in India (STPI)
• Setup in 1991 as an autonomous organization under Ministry of Information Technology
• Aim: To promote software Exports by acting as ONE STOP SHOP by:– Creating an enabling environment for healthy IT
exports nationwide– Strengthening Technical Infrastructure– Providing Single window clearance to software
exporters – Shift towards OFF SHORE model of software
development work
(c) Prof. Neha Patel,GLS MBA Programs
• STP Scheme is being operated by the technical body
• Investment Approvals decentralized
• Most of the authoritaties are sub-Delegated to the Directors of the STPI Centers – Result Decentralized Single Window
STPI Differentiators
(c) Prof. Neha Patel,GLS MBA Programs
Benefits
• Complete duty free import
• 100% foreign equity permitted
• No corporate income tax till 2010
• Dedicated Data Communication links
• Single window Government clearance
• Custom bonding and export certification provided at single point.
What is STP Scheme?
(c) Prof. Neha Patel,GLS MBA Programs
STPI: Key Areas of Contribution
Growth of IT Exports from the nation
Dispersal of Industry to Tertiary Cities
Contribution to SME Enablement
Enhanced Employment Generation Nationwide
(c) Prof. Neha Patel,GLS MBA Programs
Catalyst of Regional Development
Overall Regional Development
Nucleating effect on Employment generation
Secondary Industries coming up
Improvement in Basic and Social Infrastructure
(c) Prof. Neha Patel,GLS MBA Programs
1991 1995 After IT Taskforce
Bangalore
NOIDA
Pune
Hyderabad
Trivandram
Ghandinagar
Bhubaneshwar
Mohali
Jaipur
Mumbai
Aurangab
ad
Bhilai
Chennai
Coimbator
e
Dehradun
Guwahati
Hubli
Indore
Kanpur
Kolkatta
Lucknow
Nasik
Allahabad
Jodhpur
Jammu
Hubli
MangaloreManipalMaduraiMysoreNagpurPondicherryPuneRourkelaSrinagarShimlaThirupatiTrichyVijayawadaVizagWarangalTirunaveli
STPI Centers: Nationwide spread
(c) Prof. Neha Patel,GLS MBA Programs
SEZ – Special Economic Zone
• It is specifically delineated duty free enclave• Shall be deemed to be foreign territory• Goods going into SEZ shall be treated as Deemed exports• Goods coming from SEZ into DTA (domestic tariff area) shall be treated as being imported• Existing EPZ may also be converted into SEZ by Ministry of Commerce
(c) Prof. Neha Patel,GLS MBA Programs
What is special?
• Duty-free! – Exemption from taxes, various subsidies and tax sops
• Hassle-free! – Exemption from stringent labor and environment regulations
• Foreign enclave! – A designated duty free enclave and to be treated as foreign
territory for trade operations and duties and tariffs
• Single Window Clearance! • No license required for import• Only 25% of the area for industrial activity –
– the rest of the area for entertainment and residential as well as other commercial activities!
(c) Prof. Neha Patel,GLS MBA Programs
What is special?
• No fixed wastage norms • Full freedom for subcontracting including subcontracting abroad• Job work on behalf of domestic exporters for direct exports
allowed• Contract farming allowed for agriculture/ horticulture units• No routine examination by Customs of export & import cargo• In house customs Clearance
(c) Prof. Neha Patel,GLS MBA Programs
SEZ Framework
Pre
fere
ntia
l Pol
icy
Fram
ewor
k
Hassle Free O
perating Environm
ent
Integrated Infrastructure
Fiscal incentives & regulatory benefits
Thrust on self-certification &
in-zone empowerment
Self-contained & Self-managed
SEZ
(c) Prof. N
eha Patel,G
LS M
BA
P
rogram
s
Fiscal Benefits available to SEZ
Cenvat Cenvat
CustomsCustomsVAT VAT
Income Tax Income Tax
Service Tax Service Tax
Central Sales tax
Central Sales tax Securities
Transaction Tax
Securities Transaction
Tax
Exemptions of tax, duties or
cess in 21 Acts
Exemptions of tax, duties or
cess in 21 Acts
Stamp DutyStamp DutyFEMAFEMA
Other ActsOther Acts
(c) Prof. Neha Patel,GLS MBA Programs
(c) Prof. Neha Patel,GLS MBA Programs