Print Edition - 2016-02-25 | MONEY
SEZ plans changes to working procedure
- lukewarm response from industrialists
Feb 25, 2016-
With the Bhairahawa-based Special Economic Zone (SEZ) failing to attract industries even more than a year after its inauguration, the government plans to make “significant” changes to the SEZ’s working procedure.
Industrialists have complained about high rental fee, high paid-up capital requirement and rigid criteria for setting up factories. “Just a few firms responded to two tender calls, prompting the SEZ to form a committee to identify any shortcomings,” said engineer Laxman Bhattarai. “The panel has recommended amendments to the action plan. The revised plan will come by mid March.”
He added that a new Act, including the amended action plan, will also be rolled out soon.
Once the action plan is finalised, the SEZ will again ask industrialists to apply to set up their plants there. According to a SEZ official, they plan to maintain “very minimum” rental charges and lower the paid-up capital requirement to lure industrialists.
The SEZ will also adopt more flexibility when it comes to the types of industries allowed to operate. Earlier, only 17 types of industries were allowed to operate in the SEZ.
Siddharthanagar Chamber of Commerce and Industry President Ram Kumar Sharma said if the new working procedure comes out with lower rental charges, more industrialists would be attracted. “Currently, industrialists are not interested in the SEZ as the rent has been maintained very high,” said Sharma.
Currently, the rent has been maintained at Rs150 per square metre, and sources said the rate would be lowered to Rs25-35 in the amended action plan.
The SEZ was established by the government to entice industries that could generate a large number of employment opportunities, attract foreign direct investment and increase exports. According to Bhattarai, once the amended working procedure comes out, the SEZ will kick start even if only five firms show readiness to operate.
Published: 25-02-2016 09:27