M A I N   N E W S

Govt for stricter land norms for SEZs
Left calls for relook at SEZ Act
Tribune News Service

New Delhi, October 19
While Commerce and Industry Minister Kamal Nath today said only waste and barren land, and if necessary single crop agricultural land, alone should be acquired for the Special Economic Zones (SEZs), the Left parties today called for review of the SEZ Act itself as it enabled “re-establishment of the zamindari system” in the country.”

“If per force a portion of double-cropped agricultural land has to be acquired to meet the minimum area requirements, the same should not exceed 10 per cent of the total land required for the SEZs,” Mr Kamal Nath said in his valedictory address at the Agriculture Summit 2006 here.

He said in the first 150 SEZs, which were given formal approval, the entire land was in the possession of the State Industrial Development Corporations or with companies and not a single farmer had been displaced.

In a detailed seven-page note submitted to the UPA government today, the Left parties said: “Several provision made in the SEZ rules have raised concerns of misuse of the SEZ Act for creating a speculative real estate bubble instead of building industrial infrastructure.”

The note said there should be no transfer of land ownership to private developer, but given on lease on a BOT basis and the Centre should consider only those proposals which the state governments had approved. Comparing SEZ policies of China and India, the Left note said the major difference was on the issue of land acquisition. Unlike in India, it was the state which acquired and developed land for SEZs in China. The investor was invited only after that, and the land was given on lease.

There should be a ceiling on total land under any SEZ and the maximum land area should also be specified. There should be a national rehabilitation policy to deal with the issues concerning displaced farmers.

The processing area of SEZs should not be less than 50%. Further, 25% of the non-processing area should be dedicated to infrastructure development. Building of residential and commercial complexes should be permitted over 25% of the total land area. The SEZ rules should be suitably amended in this regard, it said.

Internal estimates of the Finance Ministry suggested a revenue loss of Rs 1,75,487 crore against an estimated investment of Rs 3,60,000 crore. While these projected estimates were based on certain assumptions, the issue could not be brushed aside by saying that these revenue losses were “notional,” as the Minister for Commerce and Industry had done in the Parliament, the Left parties said.

They suggested a slew of measures such as income tax concession for only two years, no service tax exemption and concession given by Centre or state government should be compensated for revenue loss and all financial activities should be within the regulatory ambit of the RBI and subject to the same tax provisions, regardless of whether their offices were physically located within the SEZ or the Domestic Tariff Area. The rights of workers should be protected in SEZ, it added.