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Study of Dronagiri SEZ -- CIDCO shortlists KPMG, TECS

Kripa Raman

MUMBAI, Oct. 29

THE City and Industrial Development Corporation of Maharashtra Ltd (CIDCO) has shortlisted KPMG and Tata Economic Consultancy Services for a techno-economic feasibility study of its Special Economic Zone in Dronagiri (Navi Mumbai).

CIDCO is the development agency for Navi Mumbai which was carved out as a satellite city to congested Mumbai.

The study is being done chiefly to draw the attention of foreign investors to the SEZ, now that the Exim Policy of April, 2000 has allowed 100 per cent foreign direct investment in SEZs that are delimited by the Government.

CIDCO had originally intended Dronagiri to be its 100 per cent export-oriented information technology hardware park. The intention now is to encourage a number of `high-value' industries to come up in the zone.

``We want the techno-economic feasibility study done by a heavyweight consultant, there being competition, particularly from the SEZs coming up in Gujarat and Tamil Nadu which are also far larger in size,'' said a State Government official. ``We are atte mpting to attract the kind of industries that will compensate for the constraints of the size of our SEZ,'' he said.

(Subsequently, several other States have received permission for SEZs; and a number of export processing zones have been converted into SEZs.)

``We want to have a world-class SEZ since we are looking for foreign promoters,'' said Mr. K.S. Bahuleyan, Chief Economist of CIDCO. ``The SEZ will eventually be run entirely by our joint venture with a private party or consortium, foreign or Indian. Thi s company will act as promoter and developer.''

``One of our chief attractions is that we are close to the Jawaharlal Nehru Port which accounts for the largest chunk of trade happening to and from the country. Apart from this, the SEZ's proximity to Mumbai will be an added attraction,'' he said.

Other states, too, are naturally setting up their SEZs close to their seaports. West Bengal plans its SEZ of 8,000 hectares near Kulpi port and Orissa 500 hectares near Paradeep, and Andhra Pradesh near Kakinada. Gujarat's SEZ is close to Positra and Tam il Nadu's in Nanguneri.

There would be a separate exit policy operational for units that come up in Special Economic Zones, and the zones will be treated as ``foreign trade territory'' for the purpose of duties and taxes. Supplies to these zones from domestic tariff areas would be treated as deemed exports and goods brought into DTAs from the zones shall be deemed imports.

The other attraction that the Union Government has promised SEZs is freedom from Customs authorities. Customs shall conduct examinations only when they have specific intelligence warranting them.