Status of Indian SEZs

We would like to write about the current state of SEZs in India. 270 SEZs have been notified as at 30th September 2008 while 531 SEZs have formal approval and 143 SEZs have in-principle approval.

There is a clear concentration of SEZs in the southern parts of the country with Andhra Pradesh, Tamil Nadu, Karnataka and Kerala accounting for 49% (133) of notified SEZs and 42% (222) of formally approved SEZs.

In terms of sectoral distribution of SEZs, IT/ITES SEZs far exceed other categories of SEZs, accounting for 66% (178) of notified SEZs and 63% (332) of formally approved SEZs. Given the slowdown in the economy and the IT/ITES sector, we believe the risk of SEZ supply getting delayed is high as developers pushback execution time lines.

Comparison of SEZ Exports from India & China:
SEZs in China are supposed to be growth engine for the manufacturing sector. However, in India it was the largest Real Estate Scam with Government sponsored violence as well for land grabbing.

Indian SEZs export 1/7th of just what three SEZs from China [Shenzhen, Xiamen and Zhuhai] do. In FY08, these Chinese SEZ exports totalled $110 bn while that of all the SEZs in India was mere $16 bn.

SEZ pricing in India: INR / sft / Month
Bangalore - 50
Chennai -40
Hyderabad - 45
Delhi NCR - 65
Mumbai Metro Region - 110
Pune - 45

Farm Land not for SEZ - Supreme Court

In a truly Landmark judgment to end the greatest Land Scam in India, the Supreme Court of India presided by Justice S B Sinha and H S Bedi ruled that "Agricultural Land should not be acquired for setting up a factory or any other corporate purpose".

They have also made it mandatory for the government to make it clear weather the land being acquired by the state is being meant for public purpose or private purpose. They made it clear that the Government's land acquisition notifications can't claim both purposes simultaneously. The order came in the case of Punjab Government and an Automobile Company.

The court also said that Agricultural land can be acquired only after an affidavit by the District Collector stating that the land being acquired is unfit for agriculture. The collector is also responsible for the compensation.

The Impact of this Judgement is likely to be felt on Reliance Haryana and Maha Mumbai SEZ. DLF's mega township and land scam in Bangalore's Bidadi Village.
Infosys SEZ plans near Bangalore. Almost all the SEZs where farm land is forcibly acquired.