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J Matadee Free Trade Zone Pvt Ltd calls for policy amendments and reforms for SEZs

Chennai trade Zone, India’s first notified trade and warehousing zone developed and promoted by J. Matadee trade Zone Pvt Ltd today, involved more favourable policy amendments and reforms for SEZs.

Mr. Sunil Rallan, Chairman and director , J Matadee trade Zone Pvt. Ltd. and President-TASID addressed the media and said that, the recent amendments proposed for will play an important role in boosting investments within the manufacturing sector, greater employment generation and growth in export volumes. The potential of SEZs has been furthered by providing relaxation and simplifying the provisions for fixing of multisector SEZs.

He further added that, foreign Investors who wish to line up new manufacturing units will find the SEZs as attractive investment hubs with good infrastructure, while redefining walk connectivity. Nearly one third of Indian Exports are out of SEZs, which now have the potential to become a robust pillar of the Indian economy and permit integration of technology and businesses to tap and drive the expansion potential of the country.

He shared few suggestions for the SEZ sector and therefore the upcoming trade agreement and proposed the subsequent points:


Manufacturing Units and provide Chains from China and ASEAN Region are keen to line up Manufacturing Units in India which may cater to the massive Indian Domestic Markets also as for Exports. These Supply chains won't achieve economies of Scale if they're compelled to line up discrete Factories for Domestic Demand and for Exports.

Currently all DTA customers make payments for his or her Imports through their regular banking Channels. However, an equivalent products aren't encouraged for Supply by SEZ Units to DTA Customers. The payments made by the DTA Customers aren't considered as being Compliant with the SEZ Rules. This defeats the Make in India Policy as Imports are being encouraged over Indian Manufacturing.

Indian SEZs are a really attractive destinations for these Overseas Supply Chains to start out new Units.

The US Trade authorities have stated in their petition before the WTO that the prevailing Net exchange Earning Rules by implication tantamount to an Export Subsidy since the Upfront Exemptions of Taxes are Deemed to be Export Linked and thus a prohibited Export Subsidy.

The recalibration of internet exchange Rules will make the Indian SEZs attractive for brand spanking new Units also as make the SEZ Scheme WTO compliant.

Mr. Sunil Rallan added that, there's no requirement of NFE within the current Policy of the govt of India, Ministry of Finance, Department of Revenue, Central Board of Indirect Taxes & Customs as detailed in Circular No. 34/2019-Customs Dated 1st Oct 2019. this may provide a positive boost to fresh investments and support government’s “Make in India” and “Assemble in India “initiative.


India has free-trade agreements with countries like Sri Lanka , Japan, South Korea and therefore the Association of South-East Asian Nations, which groups Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam. for several of the FTA partner countries, India exempts or allows concessional rate of customs duties on the listed products.

Though SEZs are treated as foreign territory for the aim of law, supply of products manufactured by SEZs to DTA are subject to full Tariff including on the Local Content Value Additions.

Products manufactured by Indian SEZ Units are uncompetitive as compared to imports from the FTA Partner countries.

Mr. Sunil Rallan suggested that, duty/tariffs must be levied supported the Duty Foregone Principle. this may enable very high manufacturing efficiencies to be achieved if new Units are able to do economies of scale with access to both the Indian Markets also as exports.

He further emphasized that, the country has witnessed a big boom within the warehousing, logistics infrastructure and transportation sector. Creating a superior trading infrastructure, building a seamless interface of single window clearances, harnessing technology and advantages like skilled manpower at competitive rates along side other domestic resources can substantially make a strong case for a robust SEZ and FTWZ ecosystem. it'll help in attracting more players and boost levels of international trade and investments. simple doing business for domestic and international players can make SEZs and FTWZs global manufacturing and distribution hubs within the coming years.

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