GoM brushes aside cap on SEZs; says let 75 zones start

New Delhi, Aug 23 (UNI) Putting a cap on the controversy of the number of Special Economic Zones (SEZs) that the country should have, the Group of Ministers (GoM) tonight decided to let at least 75 SEZs be operational before the government reviews the policy again.

The GoM, presided over by Defence Minister Pranab Mukherjee also decided that no fresh proposals for approval would be taken till at least 75 of these zones become operational in the next five to six months. The decision by the GoM was taken after a heightened controversy whether there should be a cap on the number of SEZs.

''There was never any cap and there would never be any cap,'' a beaming Commerce and Industry Minister Kamal Nath told reporters after the GoM meeting which was attended among others by Finance Minister P Chidambaram and Communication Minister Dayanidhi Maran.

While over 150 SEZs have been given in principle approval, only 28 zones are operational as of now.

The Commerce and Industry Ministry was facing tremendous pressure from the Finance Ministry which had argued that the indiscriminate approval and mushrooming of the SEZs would mean a huge revenue loss to the exchequer.

Asked to comment on the opposition to the tax benefits to the SEZ units, the Commerce Minister said West Bengal Chief Minister Budhadeb Bhattacharjee has written him a letter supporting the SEZ. ''The letter of the West Bengal Chief Minister which was put before the GoM has said that the SEZs are good for the country and should be supported'', Mr Kamal Nath said.

Earlier in the day, Mr Kamal Nath has assured the Rajya Sabha that the existing legal provisions would not be allowed to become a tool for real estate developers and land mafia to seize the land of farmers.

Replying to half an hour discussion in the House on the subject of SEZs, he allayed widespread concerns that land was being acquired from farmers at a throwaway price for establishing industries and SEZs.

The minister, however, said there was a provision in the April 2000 law which enabled acquisition of land for setting up industries. But utmost care would be taken that farmers were not given a raw deal nor land fell into the hands of the mafia.

He said sanctioning of SEZs was in the domain of the state governments, but the Centre would impress upon them the need to maintain fairplay.

Describing the SEZs as an ''instrument of incremental economic activity and a stimulus for investment'', he said the 28 existing SEZs, which were operational, generated exports worth Rs 22000 crore last year, besides creating direct employment fot 1.1 lakh people.

The minister said 927 industrial units had become operational so far in these 28 SEZs, having a total investment of Rs 2,000 crore.

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