Proposed SEZ amendment bill may figure in 100-day agenda

This will encourage value addition within the SEZ, as in most cases, the tariff on finished products is higher than on inputs, Srivastava had said.SEZs have emerged as an important contributor to Indias exports. Total exports from these zones stood at USD 155.8 billion in 2022-23.

The proposed amendments in the Special Economic Zones (SEZ) law are expected to figure in the 100-day agenda of the commerce ministry for the next government and it may be introduced in the monsoon session of Parliament, sources said.

The monsoon session will be the first session of the newly elected government which will also see the presentation of the full budget for 2024-25.

The seven-phase Lok Sabha polls, the world's biggest election exercise, will kick off on April 19 with the counting of votes set to take place on June 4.

The government is considering several measures such as a flexible framework for the sale of products manufactured in SEZs in the domestic market, and streamlining approval processes for units, they said.

The aim is to help revive SEZs and facilitate business transactions between SEZs and the domestic tariff area (DTA) or the domestic market.

SEZs are enclosures that are treated as foreign territories for trade and customs duties, with restrictions on duty-free sales outside these zones in the domestic market.

The commerce ministry had earlier held an inter-ministerial meeting on the proposals.

Last year, Commerce and Industry Minister Piyush Goyal said that the government is looking at easing certain restrictions for units in SEZs to promote the sector's growth.

Think tank Global Trade Research Initiative (GTRI) in a report has suggested the government allow sale of products manufactured in SEZs in the domestic market on payment of duty foregone on inputs as that would help promote value addition.

At present, units in SEZs are allowed to sell their products in DTA on payment of duties on an output basis (finished goods).

GTRI Co-Founder Ajay Srivastava had said that the government already allows DTA sales on payment of duty foregone on input basis to firms operating under the Manufacturing and Other Operations in Warehouse Regulations (MOOWR) scheme.

The government can ''extend the same concession to the SEZs for parity sake. This will encourage value addition within the SEZ, as in most cases, the tariff on finished products is higher than on inputs,'' Srivastava had said.

SEZs have emerged as an important contributor to India's exports. Total exports from these zones stood at USD 155.8 billion in 2022-23. These included USD 61.6 billion of merchandise and USD 94.2 billion of service exports.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)