Special Economic Zone Amendments Bill 2019 Passed in Indian Parliament
Special Economic Zones (SEZ) are the enclaves within domestic territory of of India which has special laws governing financial and economic aspect. Infact, the precursor of SEZ was Export Processing Zone (EPZ) and the first EPZ of Asia was in Kandla (Gujarat) in India.
But in 2005, Special Economic Zone Act 2005 was legislated by the Parliament of India the main objective of the law was to establish manufacturing or service companies which have high export value and high employment generation potential. The entities established in such SEZ areas were given many exemptions related to customs duty, corporate income tax, service tax, etc. The proposal for establishing the entity was given to state government which was sent by State Government to Ministry of Commerce and Industries and the Board of Approval chaired by Secretary of Commerce would give his approval, this entire approval process constitute single window permission facility.
But over the years, despite the facilitation by the government the economic activity in such zones did not picked up fulfilling the objectives of Indian Economy. Hence, the law was amended in 2019 especially the definition of “person” was changed from corporate body or partnership firms to-
Under the Act, the definition of a person includes an individual, a Hindu undivided family, a company, a co-operative society, a firm, or an association of persons. The Bill adds two more categories to this definition by including a trust, or any other entity which may be notified by the central government.
This amendment was due to the fact the now Infrastructure Investment Trusts (InvITs), Real Estate Investment Trust (REITs), multi-state cooperative societies have mushroomed as corporate vehicle to finance and invest in large projects. With this amendment Minister of Commerce Mr. Piyush Goyal have projected that total investment proposed by these trusts comes out to be ₹8,000 crore and the government expects about $3 billion annually. “At the end of March 2019, the investment in SEZs was a whopping ₹5 lakh crore plus and the employment was over 20 lakh and exports were over ₹7 lakh crore,"