HomeIndustry NewsTweak in SEZ rules only for IT/ITES

Tweak in SEZ rules only for IT/ITES

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The central government recently amended certain SEZ rules in order to help developers fully utilize vacant space.

The new change in rules allows partial and floor-wise denotification of special economic zones (SEZs). This however is applicable only for Information Technology or Information Technology Enabled Services Special Economic Zones.

‘The Board of Approval, on request of a Developer of an Information Technology or Information Technology Enabled Services Special Economic Zones, may, permit demarcation of a portion of the built-up area of an Information Technology or Information Technology Enabled Services Special Economic Zone as a non-processing area of the Information Technology or Information Technology Enabled Services Special Economic Zone to be called a non-processing area’ stated an official notification from the government.

Speaking to Vizag Industrial Scan, VSEZ zonal development commissioner Mr M Srinivas, IRSME noted that the tweak in rules pertained only to IT and ITES SEZ developers.

‘Following the COVID onslaught and the rampant adaptation of work from home many IT and IT SEZ developers were left with huge vacant space. 

Through this notification the government has made it easier for them to give out the unutilized space to DTA (domestic tariff area) operators’ said Mr Srinivas who is also the Zonal Head for all Special Economic Zones and Export Oriented Units in the states of Andhra Pradesh, Telangana, Chhattisgarh and Yanam (Union Territory).

Reiterating that these rules pertain only to IT and ITES SEZ developers, the development commissioner informed that this will be called non-processing area where SEZ rules will cease to exist.

‘A Non-processing area may be used for setting up and operation of businesses engaged in Information Technology or Information Technology Enabled services, and at such terms and conditions as may be specified by the Board of Approval under sub-rule (1).

Demarcation of a non-processing area shall not be allowed if it results in decreasing the processing area to less than fifty per cent of the total area or less than the area specified  (see table). 

Vizag currently has two operating IT/ITES SEZs one in Madhurwada developed by APIIC and the other developed by Wipro.

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