SEZ -boon or bane?

D

deepakraam

Deepak Narayanan
Today there was much talk on the Special Economic zones(SEZ).But some people of the country are vehemently protesting the Govt's plan of mooting the SEZ at the cost of agricultural land

Is the concept of SEZ a boon or a bane?
 
In India, 25% of a SEZ is used for industrial and business purposes, and 75% for real estate and commercial complexes. SEZs will benefit only real estate and property developers since merely 25% of the land has to be used for industries or manufacturing.

Loss of revenue due to tax incentives and exemption of duties.
Exploitation of workers coz of lack of labour laws.
 
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HELPS IN REDUCING TRANSACTION COSTS
SIMPLIFIES PROCEDURES AND GIVES FISCAL CONCESSIONS- The fiscal concessions include full exemption from income tax for the SEZ units for five years and 50 per cent concession for the next five years and exemption from customs and excise duty from all imported inputs to SEZ developers as well as units located in them. They are not required to pay even the minimum alternate tax.
 
The zones are too small--as little as 100 hectares. For some special kinds of industries (software, bio-tech, gems and jewellery), that minimum size has been reduced to 10 hectares--which is little more than the size of an industrial plot. Providing quality infrastructure in such a small area can have no real meaning.

This could lead to tax scams. Whats is the commerce ministry up2?
Aint there enough tax loopholes in the country that it needs 1 more!!!
What the hell is the prime minister doing????
On top of this the commerce ministry has decided to increase the nos. of SEZs to 300 from 150...........What the f##k is wrong??!!!!!???
 
Are the original landowners adequately compensated ?
both for loss of an asset [land]
& loss of income from the asset [farm produce].

Govt. will be forcibly acquiring land at low prices
for the benefit of the SEZ developers.

Why are SEZs not being developed in the
Interiors away from the Metros / Mini-metros.
 
india moving towards 9-10% gdp...yet the agiculture has dropped to 2.4% -punjab no longer an agriculture prominanat state ..farmers commiting suicides.....all this alarming issues and on the other hand snatching land from farmers .....!!! india is really in trouble.........i feel somewhere it is ambani -tata etc big fishes game and nothing else.......
 
A growth rate of 9.4 per cent in 2006-07 is great news, but the challenge lies in keeping it going. There is always a risk of its coming unstuck if agriculture continues to remain a laggard - it grew by just 2.7 per cent in the previous fiscal. Some economists argue that since agriculture contributes just 18.5 per cent of India's gross domestic product, its slow growth will not act as a drag on the entire economy. They are mistaken.

Rural India still accounts for 60 per cent of the country's population, and can vote governments out of power if it perceives that growth is not helping people at large. That could upset policy momentum and business sentiment. Besides, the participation of a large number of people in the market would stabilise industrial demand over time, creating the right climate for investment. While there has been no dearth of suggestions on how to lift agriculture by the bootstraps, there is one problem that deserves overriding priority - Rs 58,000 crore of fruit, vegetables, pulses and grains, or a third of total food produce, is wasted each year for want of storage and marketing facilities. Of the produce that survives, very little is processed, compared to the situation in Malaysia, the Philippines, Brazil and Thailand. It is here that the entry of organised retail can make a huge difference.

It would lead to the creation of large, efficient cold storages, which, in turn, could transform the character of the food processing industry by enabling it to deal in large volumes. At present, food processing is dominated by the small-scale sector, which is not equipped to deal either in volumes or variety of produce. In the absence of storage systems, these units do not operate round the year; yet, it is remarkable that this sector employs about 1.5 million people.

It is often overlooked that the Indian agriculture sector is almost totally private. However, it belongs to the realm of the unorganised sector and as such lacks both capital and organisational skills to maximise returns. What is needed is to create a mutually beneficial synthesis between organised private capital as represented by, say, ITC or Wal-Mart and the amorphous agrarian sector.

The government should play its legitimate role as an honest broker to help both parties work out an advantageous deal for all concerned. This could be done by ensuring that there are no job losses, that food prices are both remunerative and stable, and the small agriculturist is saved from suicidal debt
 
SEZ can be a boon if they are strategically placed.government shud sanction only barren land for construction of sez. and it is better to make large sezs than small ones in every state to please the state government.though the government has a lot to lose in terms of revenue this is one source of employment.
 
according to me sez is boon as it will cure the regional imbalances in out country. it happens that certain region of our country r fully developed while others r undeveloped.by declaring sez in undeveloped region v can make that region developed.
 
I believe the opposition towards the promotion of SEZ is more of a political gimmick rather than a true sympathetic feeling toards farmers.With thr development of SEZ it si going to add to the Nation's well being.
 
boon yaar.4 a rapid economic growth n inviting more funds we have 2 go 4 it.abt destroying agri lands,we hav 2 make compromies.
 
hey there
the topic is very interesting...
so my views:

SEZ is an option which was supposed to be fr the poor upliftment but has proven to be the richer's upliftment!!!
very well pt made as they shud be actually alloted barren land then agricultural land...
rajasthan has many acres of barren lands!!
abt tax evasion..we shud try out smthing gud!! till nw hw many industrialist are actually paying the tax honestly?..last week tehre was a report as there is nt a single industrialist in list of top 10 tax payers...so there shud be alternates fr that !! SEZ can't be taken as excuse!!!
wat i feel is differentail taxation cud be the solution..dn't let SEZ be tax free..make them pay but let them pay according to their paying capacity..
i guess it shud wrk!!
anu
 
Here I discuss only land acquisition for SEZs – and only for those areas where the ecological consequences and disruptions are tolerable. Equally importantly, local owners of land – whether peasants or tribals – should be freely willing to part with it if offered better economic prospects. Everything else is morally and politically incompatible with an environmental democracy. In other words, none of what follows even enters the pale of discussion if the police or thugs hired through land mafias are used (by governments or corporations) to force people out of their lands – as has happened at Nandigram or is being attempted in places like Jhajjar or Jagatsinghpur.

If SEZs are not shorthand for landgrab…

Why isn’t land being leased from farming and tribal communities by corporations or governments, rather than being bought (or simply taken over forcibly) by them? After all, strictly speaking corporations only need use, not ownership of the land.

The idea came from Jat peasants in Jhajjar, Haryana, where Reliance Industries is trying to acquire no less than 25,000 acres of farmland for one of their two giant SEZs in the country. “SEZ agar bane bhi toh malkiyat hamari honi chahiye” (even if the SEZ is built we must have the ownership),

the modern township of Magarpatta near Pune, built on 400 acres of what used to be farmland till recently – where farmers have been willing to dramatically change their way of life and allow use of their land for the price of a royalty earned in perpetuity (for landowning farmers and their progeny) from the developer. They live in comfortable housing in the township, have been awarded supply contracts of various kinds and their per capita income has increased significantly. All this while their land is on rent to software companies, shopping malls, schools and hospitals. Farmers also have the right to cultivate land which will not be used for some years to come.

It is not a perfect arrangement. For instance, one wonders what has happened to landless farm workers who were employed by the farmers earlier. Have they found equivalent or better employment in the township?

One can also take issue with the fact that fertile agricultural land has been diverted towards industrial use, when there is so much wasteland in the country. At a time when food prices are rising on account of shortfalls in supply and there is some doubt about the long-term food security of the country, one can justifiably criticize the adoption of approaches like Magarpatta’s.

It may be argued in response that a free, democratic society ought to leave the decision about land-use (below a certain quantum) in the hands of the owner. Isn’t it the case however, that millions of farmers across India have begun finding agriculture a poor economic proposition (and have often been driven towards debt and even suicide in the hundreds of thousands) only during the last decade and a half, thanks to hostile World Bank/IMF/WTO-friendly state policies towards agriculture – which have raised input costs for farmers, even as they are having to compete with subsidized grain from the West without the aid of support prices guaranteed by the government? (Free trade as Washington understands and wants it.) For instance, companies like Monsanto are slowly taking full control of India’s seed supply (and costs), thanks to World Bank pressure (often exercised subtly through such institutions as the National Seed Corporation). And public investment in agriculture has fallen sharply under pressure from the IMF to curb public spending (though it doesn’t complain about defence expenditure rising by a shocking 60% during the last four years alone!).

The argument is difficult to knock down. Yet, in a world of third-best solutions, one has to acknowledge that even if it has led to the creation of yet another gated community, what Magarpatta symbolizes is certainly among the more amicable resolutions of land issues in present-day India.

An arrangement like Magarpatta also ensures, especially if land rights are made non-transferable, that no real estate speculation – by Indian or overseas finance capital – can come about. This addresses a major area of concern for critics of the SEZ policy.
 
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