1. Rural Infrastructure
Proposal to set up Multiproduct SEZ
for Agriculture Sector
Presented by ;
FAROOK A AZAM

2. Presentation flow
 Why this project
 Agricultural scenario in INDIA
 Karnataka Statistics Snap shot
 Need to set up Business unit for Agri Sector
 Commodities and Products related to Agriculture and Food Industry
 Location considered for project
 Project highlights
 SEZ Overview

3. Why this project
If we want to reach the double digit in our GDP then we need to
•
concentrate in this project.
The Agriculture sector is the untapped sector till date.
•
The most important is the sustainable development of Rural INDIA
•
Agriculture Growth Rate in India GDP has declined over the years. The
•
Indian government must take steps to boost the agricultural sector for this
in its turn will lead to the growth of Agriculture Growth Rate in India GDP.

4. Why this project cont....
The latest snapshots of the India GDP growth rate are as follows - GDP
factor for the first quarter of 2007-08 was at Rs 7,23,132 crore, registering
a growth rate of 9.3% over the corresponding quarter of previous year
India's economy grew at 9.3% in quarter April-June and it was driven by manufacturing,
–
construction and services sector and agriculture sector
The annual inflation rate was 4.45% for the week ended July 28, 2007
–
India's Balance of Payments is expected to remain comfortable
–
Merchandise Exports recorded strong growth
–
Manufacturing registered 11.95 growth
–
The passenger vehicles sector grew by 11.61% during April-May 2007
–
Electricity, gas & water supply performed well and recorded an impressive growth rate of 8.3%
–
Construction growth rate rose to 10.7%
–
Trade, hotels, transport and communication registered a growth rate of 12%
–
Financing, insurance, real estate and business services recorded an impressive growth rate of at
–
11% during the 1st quarter of this fiscal year 2007
Community, social and personal services maintained a decent growth rate of 7.6%
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The growth rate of agriculture, forestry & fishing' and 'mining & quarrying' are
–
estimated at 3.8 %, and 3.2 %, respectively during the 1st quarter of 2007-2008
Exports grew by 18.11% during the 1st quarter of 2007-2008 and the imports shoot up by 34.30%
–
during the same period
India's FOREX reserves (excluding Gold and SDRs) stood at $219.75 billion at the end of July ' 07
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The food sector is estimated to be of US$ 200 billion and it is expected to grow to $310 billion by
–
2015 Stocks of food-grains grew by 13.1% to 17.73 million tonnes

5. Agriculture scenario in INDIA
The growth rate of India GDP is 9.4% in 2006- 2007. The agricultural sector has always been an important

contributor to the India GDP. This is due to the fact that the country is mainly based on the agriculture
sector and employs around 60% of the total workforce in India. The agricultural sector contributed
around 18.6% to India GDP in 2005.
The agricultural yield increased in India after independence but in the last few years it has decreased.

This in its turn has declined the Growth Rate of the Agricultural Sector in India GDP. The total production
of food grain was 212 million tonnes in 2001- 2002 and the next year it declined to 174.2 million tonnes.
Agriculture Growth Rate in India GDP declined by 5.2% in 2002- 2003. The Growth Rate of the Agriculture
Sector in India GDP grew at the rate of 1.7% each year between 2001- 2002 and 2003- 2004. This shows
that Agriculture Growth Rate in India GDP has grown very slowly in the last few years.
The agricultural sector has had low production due to a number of factors such as illiteracy, insufficient

finance, and inadequate marketing of agricultural products. Further the reasons for the decline in
Agriculture Growth Rate in India GDP are that in the sector the average size of the farms is very small
which in turn has resulted in low productivity. Also the Growth Rate of the Agricultural Sector in India GDP
has declined due to the fact that the sector has not adopted modern technology and agricultural
practices. Agriculture Growth Rate in India GDP has also decreased due to the fact that the sector has
insufficient irrigation facilities. As a result of this the farmers are dependent on rainfall, which is however
very unpredictable.


6. Agricultural Sector contribution to GDP
 India gross domestic product (GDP) means the total value of all the services and goods that are
manufactured within the territory of the nation within the specified period of time. The economy of India is
the twelfth biggest in comparison to that of others in the whole world, for it has the GDP of US$ 1.09 trillion
in 2007. The country has the second fastest major growing economy in the whole world with the GDP
growing at the rate of 9.4% in 2006- 2007.
 The composition of Indian GDP includes many sectors like industry, infrastructure, agriculture, and services.
The percentage of the share of these sectors in the composition of India GDP differs and also has
changed over the years. India GDP Composition Sector Wise was that the agriculture sector contributed
around 32%, services sector contributed 41%, and the industry sector contributed 27% in 1990- 1991.
 The agriculture sector contributed the most to India GDP after the independence of the country. This sector
contributed to India GDP around 18.6% in 2005. The contribution of the agriculture sector has gone down in
India GDP in the last few years but in spite of this the sector remains the largest economic sector in India.

8. Karnataka statistics snap shot cont..

9. Karnataka statistics snap shot cont..

10. How to resolve the GAP ?
Agriculture Growth Rate in India GDP has declined
over the years. The Indian government must take
steps to boost the agricultural sector for this in its
turn will lead to the growth of Agriculture Growth
Rate in India GDP.

11. Need of Business unit setup for Agro
sector
• For work units, such as clothing, toys, paper conversion, change packaging
and specialty packaging, value-added in agriculture and cultivation of
plants Horticulture.
• spices, rubber, coconut and arecanut based products
• Production units specialized in all entries to the Indian cuisine as masalas,
finished preparations of dried vegetables, ingredients for and entrances,
maize, sugar, rice and rice, wheat, potatoes and onions, vegetables dried
and other processed foods and be considered

12. Commodities and Products related to
Agriculture and Food Industry

13. Commodities related to the Agriculture and
Food Industry
Dry Fruits
•
Animal & Animal Products
•
Almonds
–
– Buffalo Meat
Cashew
–
– Eggs Coconut
–
– Livestock Peanuts
–
Walnut
–
Animal Feed
•
Dye & Colours
•
Bakery and Confectionery
•
Plant Products
•
Beverages
• Flowers
–
– Alcoholic Beverages Mango
–
Sugarcane
–
– Coffee
Tobacco
–
– Soft Drinks
Fruits and Vegetables
–
– Tea Processed Foods
•
– Wine Ice-cream
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Pickles
–
Cereals
•
Seeds
•
– Barley
Cocoa
–
– Maize Vegetable Seeds
–
– Pulses
– Rice
– Wheat

14. Commodities related to the Agriculture
and Food Industry contd...
– Garlic
Spices
•
– Asafoetida – Ginger
– Basil – Galanga
– Bay leaves – Kokam
– Bishop's Weed – Mustard
– Cardamom (small) – Pepper
– Cardamom (large) – Poppy
– Cassia – Saffron
– Celery – Tamarind
– Chilly – Turmeric
– Coriander – Vanilla
– Cumin
– Curry leaf
– Dill
– Fennel
– Fenugreek

15. Products related to the Agriculture
and Food Industry
Bakery & Confectionery Products
•
Bakery, Biscuits, Chocolate Chip, Chocolates, Cocoa, Confectionaries, Confectionery,
Cookies, Deoiled Cake, Drinking Chocolates, Bread, Cakes, Malted Foods, Sweets,
Pastry, Toffees
Cattle Feed Supplements
•
Cattle Feed, Animal Feed, Animal Feeding Stuffs, Fodder
Child Care & Nursery Products
•
Baby Care Products , Baby Feeding Products
Dry Fruits & Nuts
•
Dry fruits, Cashew Kernels , Cashew Nut, Cashews, Almonds, Roasted Dry Fruits,
Peanuts, Groundnut, Walnut Kernels, Walnuts, Indian Peanuts, HPS Groundnuts
Dyes & Color Additives
•
AZO Dyes, Bleaching Machinery, Colours, Color Additives, Colour Additives, Cottex
Dyeing, Dye intermediates, Dye Makers, Dyes, Dyestuffs, Cationic Dyestufs, Acid Dyes,
Reactive Dyes, Pigments, Fabric Dyeing, Textile Dyeing, Vet Dye

16. Products related to the Agriculture
and Food Industry cont..
Edible Oil & Allied Products
•
Coconut Oil, Cooking Fats, Cooking Oil, Cumin Seed Oil, Edible Oil , Castor Oil , Celery
Seed Oil , Ajowan Oil , Margarine Oil , Refined Oil , Refined Vegetable Oil , Rice Bran Oil ,
Sesame Oil , Sunflower Oil , Mustard Oil , Groundnut Oil , Herb Oil, Vanaspathi Ghee,
Vegetable Oil , Vegetable Oil , Oil Products, Table Margarine
Fertilizers
•
Bio Fertilizers, Chemical Fertilizers, Agriculture Fertilzers, Natural Fertilizers, Nonhazardous
Bio Fertilizers, Non-toxic Fertilizers, Organic Fertilizers, Organic Manure,
Fertiliser Mixtures, Fertilisers, Fertilizer Mixtures, Fertilizers, Urea Fertilizers
Flowers, Floriculture & Dried Flowers
•
Dried Floral Items , Dried Flowers , Dry Flower , Bouquets, Cane Flowers , Lotus Pods ,
shola Flowers , Palm Leaf , Floriculture, Flowers, Foliage, Handmade Flowers

17. Products related to the Agriculture
and Food Industry cont..
Food Processing Plants, Machinery & Equipment
•
Bakery Equipment, Dairy Equipments, Dairy Farms Equipment, Food Grain Machine,
Food Processing Equipment, Frying System, Spray Dryers
Fresh, Dried, Preserved & Dehydrated Fruits and Vegetables
•
Bananas Dried , Bananas Fresh , Beans, Cherry, Cucumbers, Dried Fruits , Dried
Truffles , Dried Vegetables , Carrots, Lemon, Mandarins, Mangosteens, Meslin, Shallots,
Spinach, Mixed Vegetables , Mushroom, Mushroom Spawn , Oranges Fresh , Papaya,
Pineapple, Potatoes Fresh , Preserved Fruits , Preserved Vegetables , Radiata Dried,
Fresh Apples , Fresh Asparagus , Fresh Fruits , Fresh Grapes , Fresh Oranges , Fresh
Vegetables , Gherkins, Grapes, Fresh Turnips
Liquors, Mineral Water & Beverages
•
Beverages, Bewerages, Brandy, Aerated Water , Aerated Waters , Alcoholic Beverage ,
Liquors, Rum, Sandpiper, Schweppes, Soft Drinks , Spring Water , Mineral Water , Fat
Liquors , Gin, Vodka, Whisky, Wine, Indian Liquor, Indian Wine
Marine Food Supplies
•
Dried Beche-de-mer, Dry Fish, Aqua Foods, Marine Food, Marine Products, Sea
Cucumber, Sea Food, Shrimps, Prawns, Frozen Marine Products, IQF

18. Products related to the Agriculture
and Food Industry cont..
Meat & Poultry Food
•
Bacon, Egg, Livestock, Lyoners, Meat, Mortadella, Peppero, Poultry Feed , Poultry Food ,
Frozen Meats , Ham
Milk & Dairy Products
•
Cheese Spread , Condensed Milk , Curd , Dairy Products , Dairy Whitener , Dry Yeast,
Butter, Cheese, Ice Cream , Ice Cream Corns , Shrikhand, Milk, Milk Cans , Milk Powder ,
Milk Products , Paneer, Extract Powder , Flavoured Milk , Yeast
Natural Dried, Live and Grafted Plants
•
Live Plants , Natural Dried Plants , Natural Plants grafted Plants
Other Miscellaneous Agro Products
•
Bajra, Barley, Dried Marine Products , Cane, Jaggery, Agro Commodities , Agro Product ,
Jaggery Powder , Sorbitol, Soya Meals , Starch, Sugar, Namkeens, Natural Honey ,
Onions, Papad, Flour, Foodstuffs, Glucose, Gluten, Groundnuts, Honey

19. Products related to the Agriculture
and Food Industry cont..
Pet-Use Products, Feeds, Pet Furniture & Allied Products
•
Dog Biscuits , Raw Hide Bones , Pet Feeds , Pet Products , Pet-Use Products ,
Equestarian Goods , Equestarian Harness
Pickles, Chutneys, Ketchups & Sauces
•
Chilly sauce , Chutney, Chutnies, Ketchups, Lemon Pickles , Mango Pickles , Sauces,
Soya Sauce , Synth Vinegar , Mustard Sauce , Pepper Sauce , Pickles, Garlic Sauce ,
Tomato Ketchups , Tomato Sauce
Processed Food & Snacks
•
Canned Fish , Canned Food , Malt Extract , Snacks, Soup, Soup Concentrate , Soup
Powder , Porridge, Potato Wafers , Processed Chicken , Processed Foods , Processed
Seafoods , Processed Snacks , Fish & Sea Food , Frozen Fish , Frozen Meat , Frozen
Shrimps
Rice, Wheat, Pulses & Other Food Grains
•
Cereals, Maida, Maize, Rice, Rice Bran Extractions , Rice Mill Machinery , Sorghum,
Soymeal, Suji, Parmal, Pulses, Wheat Flour, Wheat Machinery

20. Products related to the Agriculture
and Food Industry cont..
• Seeds, Buds, Plantation & Related Products
Basil Seed , Cumin seeds , Dill Seed , Buds, Cellery Seed , Hybrid Seeds , Seeds,
Sesame Seeds , Sesbania Seed , Sunflower Seeds , Mustard Seeds , Oil Seeds , Plant
Products , Plantation, Plants, Psyllium Seed , Fennel Seed , Fenugreek Seed , Herb
Seeds , Tamarind Seed , Vegetable Seeds
• Spices & Derivatives
Black Pepper , Chilli Powder , Chillies, Cinnamon, Cloves, Coriander Powder , Cumin,
Curry Powders , Dry Ginger , Dry Red Chilly , Elaichi, Cardamom, Chat Masala , Chatni,
Anise, Indian Spices , , Salt, Spices, Spices From India, Onion Powder , Pepper
Fenugreek , Seeds, Garam Masala , Ginger, Hot Spices , Turmeric, Turmeric Powder
• Tea & Coffee
Black Tea , Coffee, Coffee Beans , Darjeeling Teas , Assam Teas , Indian Tea , Instant
Coffee , Leaf Coffee , Leaf Tea, Packaged Tea , Green Tea , Tea , Tea Bags, CTC Teas
• Tobacco & Tobacco Products
Beedi, Betalnut Leaves , Betalnut Supari , Bidi, Bidi Leaves , Chewing Tobacco ,
Cigarettes, Arecanut, Jarda, Scented Tobacco , Smoking Items , Smokking Tobbacco ,
Snuff, Supari, Opium, Pan, Chatni, Pan Masala , Pan Parag , Tobbacco, Tobbacco
Products , Tulsi Mix , Gutkazarda, Tulsi Zarda , Tobacco, Zafrani Zarda

21. Agri industries help strengthen the farm
sector and stabilize rural incomes
 AGRI Industries are considered an extended arm of agriculture
but in India they have not received as much attention as
agriculture.
 While agriculture contributes about 25 per cent of India's GDP
the value added by the processing industry is only 8 per cent
of total food production.
For example,
only two per cent of horticulture products are estimated to be
processed and more than 30 per cent of production is wasted
due to lack of storage and processing facilities.

22.  The private sector is yet to realize the full potential of agro
industries. The global market is enormous for sugar, coffee, tea
and processed foods such as sauce, jelly and honey.
 The market for processed meat, spices and fruits is equally large.
 Only with mass production aided by modern technology and
intensive marketing can the domestic market as well as the
export market be exploited to the fullest extent.

23.  If only one would spend a few hours in the food section of the
Wal-Mart departmental store, one would understand the
depth and width of the market for processed foods.
 Most of the foods on the shelves are imported from Latin
American and European countries. The position is the same in
Singapore, London or New York.

24. Huge domestic market
 Even before exploring the opportunities abroad, one has to look
within the country.
 The size of the Indian food market is Rs. 350,000 crores.
 An average Indian spends around 53 per cent of his/her income
on food.
 The domestic market for processed foods is not only huge but is
growing fast in tandem with the economy and an equally
attractive export market .

25. Processed Foods
 Agri industries help in processing agricultural products such as
field crops, tree crops, livestock and fisheries and converting
them to edible and other usable forms.
 Edible products otherwise known as processed foods form a
predominant segment.

26. Multiple Benefits
 The focus on value addition in the agriculture sector is vital for
comprehensive development of the rural economy.
 Since the food processing industry creates jobs, demand for
agri raw materials, leads to diversification and
commercialization of agriculture, enhancing the incomes of
farmers and creating surpluses for export of agro foods.
 The broad-based development of the food processing
industry will improve both the social and physical infrastructure
of rural India.

27. “A study by McKinsey reiterates the importance of
the food sector in India. It indicates that food in
India has an economic multiplier of 2-2.5. That is for
every rupee of revenue from food, the economy at
large gets Rs. 2-2.50. “

28. Location Considered for the project
 Mandya district
 Hasan district
 Tumkur district

29. Why these 3 districts
All the three are connected with National highways i.e. (NH-48 and
•
NH-4)
All the three are well connected with Rail link
•
Hassan district is having airstrip
•
The cheap and well educated manpower available
•
Number of Educational Institutions, polytechnics , Engineering
•
colleges and Technical training institutes
All the three are having well irrigated land
•
The agricultural output is good when compare to other districts in the
•
state
Favourable weather condition
•
Favourable State Govt . Policies till date
•
Situated midway to Mangalore and Bangalore
•

30. Highlight of Project
• Providing High end infrastructure for agro industries in SEZ, like roads, structure , parking lots and
weighing bridges cranes etc
• Services like power, 100 % power back up, treatment plants, HVAC system, CCTV in common areas,
BMS.
• More than 50 thousand direct employment will be created and indirect employment more than 1.5
lakh.
• Amenities like Convention Halls, Business hotels & auditoriums , Hotel for refreshments, Health
clubs etc
• operation and maintenance of entire Infrastructure with in the SEZ, Security in the open space and
common areas will be done by the developers
• Going to rope all the farmers to enjoy the benefits of the project to the max.
• Hospitals
• Creating a Marketing Block for the Agricultural products and sales
* Conditions apply

31. SEZ – An Overview

32. Overview
• Introduced by erstwhile Export Import Policy in April 2000 to provide internationally
competitive and conducive environment for exports
• Various fiscal/ non fiscal incentives/ benefits provided to developer and units in SEZ
• Earlier controlled by Foreign Trade Policy and Customs Act, 1962 and regulations
notified there under
• Special Economic Zone Act (‘SEZ Act’) enacted in 2005 to provide comprehensive
legislation in relation to SEZs
• SEZ – deemed to be territory outside the Customs territory of India in relation to
authorized operation
• Can be set up by private / public / joint sector or State Government or its agencies,
for manufacture of goods or rendering of services or both or as a Free Trade
Warehousing Zone
• Goods and services going into the SEZ from DTA treated as exports and goods and
services coming from the SEZ to DTA treated as imports
• SEZ deemed to be a airport, port, inland container depot, land customs station
under the Customs Act

33. Legislative Framework
SEZ Act 2005 SEZ Rules, 2006
• Basic framework for setting up and operation • Rules lays down guidelines for giving effect to the
of SEZs prescribed under the Act SEZ scheme prescribed under the Act
SEZ Rules, 2006
SEZ Act, 2005
SEZ Act, 2005 & SEZ Rules, 2006 notified on 10 February 2006
State SEZ Policy
• Lays down guidelines for giving effect to the SEZ scheme
prescribed under SEZ Act, 2005
• Policy provides for substantive and procedural benefits offered
by the State to Developer/ Units
State SEZ Policies

34. Legislative Framework
Chapter X-A of the Customs Act along with the SEZ Rules 2003 and
•
SEZ (Customs Procedure) has been rescinded with effect from 10
February 2006
All the rules and notification under other laws in relation to the SEZ
•
shall remain in force to the extent they are not inconsistent with the
SEZ Act 2005 and Rules made there under
Provisions of the SEZ Act, 2005 override inconsistent provisions of any
•
other law in force at the time of commencement of the SEZ Act, 2005
SEZ Act specifies exemption for the developer and units in the SEZ from
Customs, Excise, Service Tax, Central Sales Tax etc. However, it is not
clear as to whether this would require specific notification under the
respective legislations, or whether the specific exemption provided
under SEZ Act would suffice

35. Key Stakeholders

36. Key Stakeholders
• Person who obtains Letter of Approval from the Central
Government to establish the SEZ and undertake authorised
operations
• SEZ Act also envisages ‘multiple developers’ for the SEZ.
Developer
When one Developer does not possess minimum contiguous
land to develop an SEZ, Central Government may approve
more than one Developer
• Co-developer is a person who intends to provide
infrastructural facilities in an SEZ along with a developer
Co-Developer • Co-developer enters into an agreement with Developer
and obtain requisite permission as per the SEZ Act and Rules

37. Key Stakeholders
Units in SEZ can undertake
• Manufacturing
• Rendering of services
SEZ Units • Trading
• Warehousing
In relation to authorized operation of the SEZ
• Contractor can be appointed by developer / co-developer
to undertake authorized operations in SEZ
• Contractor can avail all exemptions, drawbacks and
Contractor
concessions available to the Developer / co-developer
• All documents shall bear the name of developer/ co-
developer along with the contractor

38. Key Regulators

39. Key Regulators
Overall authority for governing, notifying the SEZ and granting
Central Government the letter of approval
Receives and forwards the proposal with recommendations to
State Government the Board of Approval
Considers proposals for setting up SEZ and Units in SEZ
Board of Approval
Considers proposals for setting up of Units in SEZ, monitoring
Approval performance, and supervises import / procurement by
Committee Developer/ Units in SEZ
Undertakes measures for the development, operation and
SEZ Authority management of the SEZ
Development For administrative control of the SEZ
Commissioner

40. Benefits Available
Available to Suppliers
Available to Developer
Central Benefits
Central Benefits
• Central Excise
• Customs
• Service Tax
• Other Miscellaneous Taxes and
Levies • Central Sales Tax
• Income Tax • Drawback/ DEPB
• Dividend Distribution Tax State Benefits
• Minimum Alternate Tax • Sales Tax/ VAT
State Benefits • Entry Tax/ Octroi
• Electricity
• Labour

41. Incentives and facilities offered to the SEZs
The incentives and facilities offered to the units in SEZs for attracting investments into the SEZs, including
•
foreign investment include:-
Duty free import/domestic procurement of goods for development, operation and maintenance of SEZ
•
units
100% Income Tax exemption on export income for SEZ units under Section 10AA of the Income Tax Act
•
for first 5 years, 50% for next 5 years thereafter and 50% of the ploughed back export profit for next 5
years.
Exemption from minimum alternate tax under section 115JB of the Income Tax Act.
•
External commercial borrowing by SEZ units up to US $ 500 million in a year without any maturity
•
restriction through recognized banking channels.
Exemption from Central Sales Tax.
•
Exemption from Service Tax.
•
Single window clearance for Central and State level approvals.
•
Exemption from State sales tax and other levies as extended by the respective State Governments.
•
* Source from www.sezindia.gov.in

42. Benefits Available (Contd.)
Under the provisions of the SEZ Act, 2005 and the SEZ Rules, 2006 exemptions
•
are made available to Developer/ Unit and to their suppliers.
The SEZ Rules, 2006 provide that state governments ‘shall endeavor’ to
•
provide exemptions/ concessions with respect to sales tax/ VAT, electricity
duty etc
The exemption/ concession has to be refunded by developer if-
•
– Developer does not utilise the goods or services for authorised operations
– Unable to duly account for the goods and services for authorised
operations
Duty drawback or any other export entitlement on DTA supplies to be paid
•
back by the developer in case of destruction of goods in a natural calamity
– Not required where payment made in foreign exchange

43. Miscellaneous Benefits – Central Laws
Exemption from payment of taxes, duties or cess on any export or import of goods or services from the SEZ or
on procurement of goods or services from the DTA, under the following legislations-
Agricultural Produce Cess Act, 1940 Marine Products Export Development
Authority Act, 1972
Coffee Act, 1942
Coal Mines (Conservation and
Mica Mines Labour Welfare Fund Act,
Development Act, 1974
1946
Oil Industry (Development) Act, 1974
Rubber Act, 1947
Tobacco Cess Act, 1975.
Tea Act, 1953
Additional Duties of Excise (Textile and
Salt Cess Act, 1953
Textile Articles) Act, 1978
Medicinal and Toilet Preparations (Excise
Sugar Cess Act, 1982
Duties) Act, 1955
Jute Manufactures Cess Act, 1983
Additional Duties of Excise (Goods of
Special Importance) Act, 1957 Agricultural and Processed Food Products
Export Cess Act, 1985.
Sugar (Regulation of Production) Act,
1961 Spices Cess Act, 1986
Textiles Committee Act, 1963 Research and Development Cess Act,
1986
Produce Cess Act, 1966

44. Setting up of SEZ Basic Concepts

45. Key Concepts
Infrastructure facilities means industrial, commercial or social
infrastructure or other facilities necessary for the development of a
Infrastructural
Special Economic Zone or such other facilities which may be
Facilities
prescribed
Infrastructure means facilities needed for development, operation
and maintenance of a Special Economic Zone and includes
industrial, business and social amenities like development of land,
roads, buildings, sewerage and effluent treatment facilities, solid
waste management facilities, port, including jetties, single point
moorings, storage tanks and interconnecting pipelines for liquids
and gases, Inland Container Depot or Container Freight Station,
Infrastructure
warehouses, airports, railways, transport system, generation and
distribution of power, gas and other forms of energy,
telecommunication, data transmission network, information
technology network, hospitals, hotels, educational institutions,
leisure, recreational and entertainment facilities, residential and
business complex, water supply, including desalination plant,
sanitation facility

46. Role of Developer

47. Role of the Developer
Developer required to undertake authorised operations in relation to –
Development of SEZ: Creation of infrastructure (such as roads, ports, electricity, water, etc.)
and allocation of space / built up area for setting up and operating Units
Operation and Maintenance of SEZ: Day to day operation and maintenance of the SEZ and
providing infrastructure facility to the Units set up in the SEZ to ensure their smooth
functioning
• Authorized operations not defined in SEZ Act or Rules
Mainly role of Developer is to undertake development, operation and maintenance
of infrastructure and provision of infrastructure facilities

48. Approval Criteria

49. Approval Criteria – Applicant
Who can be a SEZ developer
• SEZ can be set up jointly or severally by
Central Government
–
State government
–
Any person (incl. Private / Public limited Company,
–
Partnership or Proprietorship)
Section 3(1)
49

50. Approval Criteria – Multi product SEZ
Authorised Operations • Comprehensive
• Minimum contiguous area of 1,000 hectares
(200 hectares in specified states)
Size
• Exclusive SEZ for Services to have a minimum
contiguous area of 100 hectares
• Minimum 25% of SEZ area to be demarcated as
Processing Area
processing area

51. Approval Criteria – Sector specific SEZ
Indicative Sectors-
Engineering, textile/ garments, pharmaceuticals/
Authorised Operations chemicals, handicrafts, gems & jewellery, electronic
hardware and software (incl. ITES), bio tech and non
conventional energy
• Minimum contiguous area of 100 hectares (50 hectares in
specified states)
• Electronic hardware and software including ITES – 10
Size
hectares with min. built up processing area of 100,000 sq.
meters
• Bio tech, Non conventional energy (incl. solar energy
equipment) and Gems & Jewellery sector – 10 hectares
• Minimum 50% area for processing area (for export related
Processing Area
activities)
51

52. Approval Criteria – Free Trade & Warehousing Zone
Primarily trading and warehousing activities
Authorised Operations
• Minimum 40 hectares
• No minimum area limit for setting up the SEZ
Size
• Maximum area not to exceed 20 percent of
processing area
Not specified however minimum built up area
Processing Area
should be 100,000 sq meters

53. Approval Criteria
• Area identified for SEZ to be contiguous and vacant with no public
thoroughfare
(BOA may approve otherwise on a case to case on merits in case of
Multi Product SEZ only)
Term ‘contiguous’ not defined under the SEZ Act, 2005 or SEZ Rules, 2006
Concise Oxford English Dictionary defines contiguous to mean- ‘sharing
a common border; next or together in sequence’
• Additional area can be included in the existing SEZ. Minimum area of
additional area not specified

54. Approval Process

55. Approval Process
Applicant*
Application to State Government or Board of
1
1 Approval (BOA)
Section 3(2) & 3(3)/ Rule 3
State Government Board of Approval
2
Forwards proposal to BOA with recommendations BOA approves proposal subject to such terms and
within 45 days of receipt of proposal conditions as it may specify
Section 3(6) and Rule 4 Section3(7) & 3(9) / Rule 5
3
In case proposal is directly submitted to BOA, applicant to obtain
concurrence of the State Government within 6 months of
approval by BOA (Rule 4)
Approval Rejection
Modification
Communicates to the Communicates the reasons to Central Government which shall
Communicates to the
Central Government intimate the same to the applicant
applicant
4Cont…
*Applicant refers to applicant for the development of SEZ other than Central or State Government

56. Approval Process – Post LOA
4 Central Government
Developer Ministry of Commerce grants a Letter of Approval
(LOA) to Developer
Submit details of Section 4 / Rule 6
Submit details of
identified area to
5b
proposed operations
Ministry of Commerce
5a
Board of Approval
Co-Developer
Approves authorized operations
6
On agreement with Developers, to
7a apply for an LOA
Developer
Applies to Approval Approaches DC for
7b
Committee for demarcation of
permission of Processing / Non
Notification
procurement items Processing Area
of SEZ by Central Government
(Ministry of Commerce)
8aCont… 8bCont…

57. Approval Process – Post Notification
8a 8b
Approval Committee DC
Approves import and procurement of goods Demarcates Processing / Non Processing Area
Rule 10 Rule 11
9
Developer
Obtains IEC and executes Bond cum-Legal Undertaking and follows General
Conditions of import
Rule 12 & 14
Developer
Avails duty concession on import / procurement
and commence operation
For details refer to Annexure 3

58. Approval Process – Co-developer
Action steps for Co-developer
• Enters into an agreement with developer to provide infrastructure facilities or undertake
authorized operations in SEZ
• Approaches BOA to seek approval for status as a Co-developer
• Follows the procedure of approval as applicable to developer to obtain LOA from
Central Government (Ministry of Commerce)
• However, state government recommendations not required
Developer may specify the requirement of Co-developer at the proposal stage.
Although SEZ Act and Rules are silent on this aspect, specifying co-developers
requirement at proposal stage may expedite the process of obtaining LOA for co-
developer at a later stage

59. For successful sustainable development
Community attitude
Cleaner & greener facilities
Cleaner & greener facilities
Initiative Labor safety & medical care
Cleaner & greener facilities
Zero tolerance for pollution
Maintain natural resources
Creating opportunity for local people

60. Thank You