Getting tough on SEZ norms

There’s a new twist to the SEZ saga. While the government has been continuously affecting changes in the SEZ Act since its inception in 2006 in terms of size, built-up area and land acquisition, among others, more contentious issues are cropping up every day.

The latest issue is that of stamp duty. Developers will now be allowed stamp duty exemption, one of the many incentives in the SEZ sops bouquet, subject to their furnishing bank guarantees of equivalent amounts.

The guarantee, claim government officials, will be forfeited by the states in case the developer is unable to set up the SEZ as per the deadline laid out in its proposal or fails to fulfil norms spelt out in the SEZ Act.

The move was also expedited as a developer who was to develop an SEZ in Gurgaon, Haryana, recently approached the government seeking permission to convert the project into an integrated township. This, since he was unable to complete the project in the form originally envisaged in his proposal. The first sign of violation was, however, nipped in the bud.

Surely, SEZ delivery pangs are not ordinary, and promoters will learn to put their money where their mouth is.