SPECIAL ECONOMIC ZONE (SEZ) IN TRIPURA
What’s in news?
The Ministry of Commerce and Industry has notified the setting up of the first ever Special Economic Zone (SEZ) in Tripura.
- The SEZ is being set-up at Paschim Jalefa, Sabroom, South Tripura District, which is 130 km away from Agartala.
- It will be a Sector Specific Economic Zone for Agro-Based Food Processing.
- The estimated investment in the project will be around 1550 Crore.
- The developer of the SEZ will be Tripura Industrial Development Corporation (TIDC) Ltd.
- The SEZ is estimated to generate 12,000 skilled jobs.
- Rubber based industries, textile and Apparel Industries, bamboo and Agri-food Processing Industries will be set-up in the SEZ.
- Setting up of the SEZ in Sabroom will open up new avenues to attract private investment considering the proximity of the Chittagong Port and construction of the bridge across Feni River in South Tripura which is underway.
- After it is set up, 100 percent Income Tax exemption will be provided on export income for SEZ units under Section 10AA of the Income Tax Act for the first 5 years.
- Also, 50 percent exemption will be provided for the next 5 years and 50 percent of the ploughed back export profit for another 5 years.
Special Economic Zones (SEZs):
- Special Economic Zones (SEZs) are geographically delineated ‘enclaves’ in which regulations and practices related to business and trade differ from the rest of the country and therefore all the units therein enjoy special privileges.
- The basic idea of SEZs emerges from the fact that, while it might be very difficult to dramatically improve infrastructure and business environment of the overall economy ‘overnight’, SEZs can be built in a much shorter time, and they can work as efficient enclaves to solve these problems.
- The SEZ Act, 2005, provides the legal framework for establishment of SEZs and also for units operating in such zones.
- The aims of SEZ include increased trade, increased investment, job creation and effective administration.
- Companies may be offered tax holidays, where upon establishing in a zone they are granted a period of lower taxation.
- The creation of special economic zones by the host country may be motivated by the desire to attract FDI.
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