The administrative
reforms commission has called for fewer special economic zones (SEZs),
shorter tax holidays and sought a relook into the SEZ Act saying that
the establishment of SEZs has become a source of conflict frequently
leading to violence.
The commission goes further to propose income-sharing strategy to
compensate oustees from SEZs to make them primary stakeholder partners
rather than one-time beneficiaries or spectators of the SEZ development.
It also wants reconsideration of the �extremely liberal tax holidays
provided both for export units and to developers�.
The latest report, which deals with conflict resolution, identifies the
SEZ policy and the consequent displacement, loss of agricultural land
and the potential for real estate speculation as an area of conflict.
It also notes that all the negative points in the Chinese SEZ policy
that led to negative consequences have been included in the Indian
policy. �It is, therefore, necessary to be vigilant about the social
costs and consequences of the SEZ policy since it may lead to
conflicts,� it adds. It seconds the recommendation of the group of
ministers on SEZs that the state governments should not normally
acquire the bulk of the lands for the SEZs.
This is a good decision because establishing SEZs to allocate land to
private companies cannot be termed as furtherance of a public purpose.
The commission says that a better approach would be to have a limited
number of SEZs preferably in backward areas so that they lead to
infrastructure creation. It also says that the proportion of land
allowed to be used for non-processing activities should be minimised.
The commission notes that the rehabilitation packages unveiled by the
SEZs are far from satisfactory and the formula of the group of
ministers that at least a person in the family is given a job is not
adequate.
The commission also says that the SEZs should specify establishment of
vocational training centres and provision of water, sanitation and
health facilities in the vicinity should precede SEZ development.
Noting that a scramble has been generated among developers to grab
cheap agricultural land in order to make quick profits or evade taxes,
the commission says that to prevent conflict situations, industrial
activities and SEZs should be located in areas where least displacement
is caused and do not usurp agricultural lands.
For the purpose, the commission says that comprehensive land use plans
should be prepared which indicate where industrial activities and SEZs
should be located. These plans, it adds, should be finalised after
public consultations.
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