EGoM meeting ends inconclusively; rehab package to be worked out

New Delhi, Jan 22 (UNI) The empowered Group of Ministers (eGOM) on Special Economic Zones (SEZs) today deferred a decision on the politically-sensitive issue until the related matter of a rehabilitation package is finalised by the Cabinet next month.

The eGOM headed by External Affairs Minister Pranab Mukherjee, which met here this afternoon, ended inconclusively without taking any fresh decision regarding SEZs.

Today's meeting assumes significance following violent protests by farmers in Singur and Nandigram in West Bengal.

The meeting decided to await the feedback from states on the touchy issue of land acquisition, which is a state subject.

"The Centre does not have any say in the matter of land acquisition," Union Commerce and Industry Minister Kamal Nath pointed out to newspersons after the meeting.

While the ministers discussed the Prime Minister's proposal for a special rehabilitation package for those displaced by SEZs, expected to be taken up by the Union Cabinet next month, it was also decided that 63 of the 300 proposed SEZs which had been notified would go ahead as proposed.

The meeting considered three aspects of the controversial SEZ issue -- the land acquisition policy, rehabilitation issues and the potential for misuse of tax breaks offered to these units.

The eGOM decided against reversal of existing policy as it was awaiting the feedback from the states on the rehabilitation draft which had been circulated among them.

However, according to Commerce Ministry sources, the export obligation clause is sought to be imposed on SEZs to make these zones less attractive for units which cannot fulfill this condition.

Due to the prior engagement of Mr Mukherjee, who is the eGoM Chairman, the meeting was adjourned inconclusively. It will now meet in early February after Mr Kamal Nath returns from the World Economic Forum at Davos in Switzerland.

Meanwhile, the Board of Approval (BoA) for SEZs will not consider any new cases until the rehabilitation policy is sorted out. Twice this month, the board has cancelled its meeting due to this reason.

So far, the BoA has given the go ahead to 237 SEZs and in-principle approval to 150 SEZs. A total of 300 applications are pending before the board.

In this context, the Centre has asked state governments to furnish all details of land acquired for setting up of SEZs.

The Ministers at today's meeting noted that land acquisition had emerged as a major concern and could snowball into a major political issue for the United Progressive Alliance (UPA) Government.

UNI