ternal e tor in ndia 15.11
money in the economy in general is called dear Sectoral broad-banding has been
currency, also called as dear money. introduced to encompass similar and
In the banking industry, it means a period of related areas under the same sector.
comparatively higher/costlier interest rates regime. A new sector ‘agro-based food processing’
sector has been introduced to encourage
sPecial economic Zone agro-based industries in SEZs (food
processing getting government’s nod
The special economic zone (SEZ) policy was
by late 2016 for 100 per cent FDI by is
announced by the government in 2000 which was
expected to give a big push to it).
concretised through the SEZ Act, 2005. It mainly
aims to develop ‘export hubs’ in the country to Dual use of facilities like Social and
promote growth and development. As an idea it Commercial infrastructure by SEZs and
was not new—India had set up Asia’s first ‘export non-SEZs entities has been allowed in
processing zone’ (EPZ) in Kandla in 1965 itself. order to make SEZ operations more
Later on the idea got another encouragement viable.
through the ‘export oriented units’ (EOUs). After Online processing of various activities
the SEZ policy was formalised through an Act, the relating to SEZ for improving ‘ease of
EOUs and EPZs are open to conversion to SEZ. doing business’.
The SEZs can be set up by either the GoI, States ‘SEZ India’ mobile app launched to help
or even private sector—in all three sectors of the the SEZs to track their transactions on
economy—agriculture, industry and services. As SEZ Online System (launched in January
per the Ministry of Commerce and Industry, the 2017).
principal objectives behind creating SEZs in the By March 2017, the Government had
country include: approved 405 proposals for setting up SEZs (in
(i) generation of additional economic addition to 7 SEZs of the GoI and 11 of States/
activity; private sector which were set-up prior to the
(ii) promotion of exports of goods and enactment of the SEZs Act, 2005)—out of which
services; 206 SEZs are operational. Today, the SEZs are
(iii) promotion of investment from domestic invested with Rs. 4.06 lakh crore and have created
and foreign sources; 16.88 lakh employment. They have 23 per cent
(iv) creation of employment opportunities; share in India’s total exports.
and In recent times, the SEZs have lost their original
(v) development of infrastructure facilities . synergy due to global economic slowdown which
Recent steps (till March 2017) taken by the followed the great recession among the developed
Government to strengthen SEZs in the country economies. Meanwhile, the Government has been
are as given below17: taking various steps to encourage them.
Minimum Land Area requirement for
setting up of new SEZs has been reduced gaar
to 50 per cent for multi-product and The GAAR (General Anti-Avoidance Rules),
sector-specific SEZs. originally proposed in the Direct Taxes Code 2010,
17. Ministry of Commerce and Industry, Government are targeted at arrangements or transactions made
of India, N. Delhi, March 2017. specifically to avoid taxes. The government had