India's “SEZ 2.0” – A Move Forward for the Manufacturing Sector

Traditionally, Special Economic Zones (SEZs) were established to enhance trade and open the economy of a country. It was evident that SEZs attracted foreign investments and gave a real push to the industrial development in particular regions.

传统意义上说,经济特区(SEZs)的建立是为了促进国家贸易、实现经济开放。经济特区能够极大地吸引外国投资,推动特定地区的工业发展。

Historically, the first SEZ was an industrial park set up in Puerto Rico in 1947 to attract investment from the US mainland. In India, SEZs was first introduced in 2005, when the Government of India passed new legislation called the “Special Economic Zones (SEZ) Bill 2005” regulating policies and drafting out the structure for setting up a SEZ units. This bill covers all important legal and regulatory aspects of SEZ development in India.

历史上第一个经济特区是1947年在波多黎各建立的工业园区,以吸引来自美国本土的投资。2005年,经济特区首次引入印度。当时印度政府通过了名为 《2005年经济特区(SEZ)法案》的立法,以规范政策,并起草了经济特区单位的结构。该法案涵盖了印度经济特区发展的所有重要法律和监管领域。

These SEZ units were established primarily for the development of Medium Small Micro Enterprises (MSME) to assist them to enhance foreign investments, increase exports, create job opportunities and promote regional development in order to boost the economy of the country. These SEZ units are regarded as foreign territories for the purpose of tax and duties. The units enjoy privileges such as export incentives and a foreign currency exemption scheme and are designed to serve to both the domestic and export markets.

这些经济特区单位的建立主要是为了发展中小微企业(MSNE),协助他们加强外国投资,增加出口,创造就业机会,促进区域发展,促进国家经济。因此在进行税收时,这些经济特区单位被视为外国领土,享有出口奖励和外汇豁免计划等特权。而现如今,经济特区已经同时服务于国内和出口市场。

In India, the first SEZ was established in the year 1963 in Kandla which is in the State of Gujarat. However, since the passing of the SEZ law notified on February 10th, 2006, a number of SEZs have been created all over India. These SEZs are tax free enclaves within the country that hold separate sets of regulations and fiscal incentives like tax exemptions and access to better and more efficient infrastructure.

在印度,第一个经济特区建立于1963年古吉拉特邦的坎德拉。然而,自从2006年2月10日经济特区法通过以后,印度各地已经建立了许多这样的经济特区。这些经济特区是印度国内的免税飞地,拥有独立的法规和财政激励措施,如免税政策及更好、更有效的基础设施。

Over the years, the Special Economic Zones Act of 2005 began losing its charm, as with economic development, the SEZ Act, 2005 became outdated and redundant. With the enforcement of a minimal alternate tax and the adoption of a sunset clause for the removal of tax benefits, these zones craved for new and updated regulations. 

随着时间的推移与经济的发展,2005年的《经济特区法》开始失去其魅力,并变得过时和多余。随着最低替代税的实施和取消及税收优惠的日落条款的通过,这些地区渴望一个新的法规。

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Photo Source:https://www.pexels.com/

On account of a recent dispute with the WTO in the year 2019, wherein the dispute settlement panel ruled against the subsidiaries and incentives given by India to companies in the SEZs as a violation of the WTO's Agreement on Subsidies & Countervailing Measures (SCM), India is set to revamp its earlier Act of 2005 and draft a new SEZ policy that shall be in line with the changing requirements of the Indian economy and that takes into consideration global experience on SEZs.

2019年的世贸组织争端中,争端解决小组裁定印度给予经济特区公司子公司的激励措施违反了世贸组织的《补贴与反补贴措施协议》(SCM),因此, 印度决定修改其早期的2005年法案,并起草新的经济特区政策,该政策应符合印度经济变化的要求,并考虑到经济特区的全球经验、吸取过去的教训。

The Indian Government in its recent Parliamentary monsoon session has proposed to introduce the new SEZ 2.0 or the Development Enterprise and Services Hub (DESH) Bill, 2022. By introducing this new Bill, the government is seeking to go beyond export-oriented manufacturing and focus on broad-based parameters such as boosting additional economic activity, generating employment, and integrating various industrial hubs. The new law will bring within its scope all the existing and new industrial hubs in order to make ample use of all the available infrastructure and enhance the competitiveness of exports. The DESH Bill is said to be in compliance with the WTO Agreement. It is proposed that the Bill will encourage more participation from the States government and could be a single window clearance of applications perceived at both State and Central level.

印度政府在最近的议会季风会议上提议引入经济特区2.0,《发展企业和服务枢纽(DESH)法案》(2022)。通过引入这一新法案,政府试图寻求超越出口导向型制造业的经济模式,并专注于基础广泛的参数,如促进额外的经济活动,创造就业机会,以及整合各种工业中心。新的法律涵盖所有现有的,及新的工业中心,以便充分地利用所有可用的基础设施、提高出口竞争力。据称,DESH法案符合WTO协议的规定。该法案将鼓励各州政府的参与,在州和中央层面对申请进行单一窗口审批。

Unlike the earlier system, wherein incentives were provided based on exports made, this new Bill shall aim at creating development hubs with high levels of infrastructure which shall not only focus on international exports but also cater to domestic consumption. In order to boost the ease of doing business, the bill also proposes the setting up and maintenance of an online portal within 6 months from the date of commencement of the Act. 

与早期根据出口提供激励措施的制度不同,新法案的目的是建立具有高水平基础设施的发展中心,这些发展中心不仅应关注国际出口,同时还应迎合国内消费。为了提高经商的便利性,该法案还建议在法案生效之日起6个月内建立起一个在线门户网站。

The government has attempted to modify certain rules as entities shall pay customs duty on the inputs used and not on expensive final goods. The Bill also seeks to integrate existing industrial estates such as textiles and food parks by converting them into developmental hubs.

政府试图通过引入新的规则进行改革,其中,实体企业应就投入为基础支付关税,而非昂贵的企业最终产品。该法案还寻求整合现有的工业园区,如纺织品和食品园区,将其转化为发展中心。

The Bill has introduced two types of developmental hubs and classified them as enterprise hubs and services hubs. While the enterprise hubs will need to maintain a certain land-based area and shall be allowed for both manufacturing and service activities, however, services hubs will have built-up area requirements and be allowed for services-related activities only. These hubs, which will come up under the regional boards of states, that shall be formulated at central level or by states or jointly or by any goods and services provider.

该法案引入了两种类型的发展中心,并将其划分为企业中心和服务中心。企业中心需要保持一定的土地面积,可以从事制造和服务活动,服务中心则具有建设面积的要求,并只允许从事与服务有关的活动。这些中心将在各州的区域委员会下建立,由中心或各州,或由两者共同制定相关规则,或由任何货物和服务提供者制定。

One of the key aspects of the new DESH Bill is also to promote the expansion of service sector units. Currently, only specified services such as IT, ITeS are allowed in special economic zones. The Bill also proposes to offer tax benefits and other sops. According to reports, the draft bill proposes to freeze the corporation tax at a concessional 15% for greenfield and brownfield units in the developmental hubs.

新的DESH法案的一个关键方面即扩大服务部门单位,目前,经济特区内只允许使用特定的服务,如IT、ITeS等。同时,该法案还建议提供税收优惠和其他优惠。据报道,发展中心的绿地和棕地单位的公司税冻结在15%的优惠税率。

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Photosource:https://www.pixabay.com/

With the incoming new and revised law, the manufacturing sector in India shall get the required push that it needs to take India to the center stage as the manufacturing hub of the world. However, there are some open issues which the draft DESH Bill seeks to identify and address through consultations with its committee and stakeholders. While coordinated action from the Government of India, state governments, industry associations, investors and all stakeholders are required, once implemented the new DESH Bill shall prove to be a game changer for India and go a long way towards realizing the goal of making it a USD 5 trillion economy by FY 2026.

随着这项新法规的出台,印度的制造业将得到有效推动,以使印度成为世界制造业的中心。然而,DESH法案草案试图通过与委员会和利益相关者的磋商来确定并解决一些开放性问题。虽然这需要印度政府、各邦政府、行业协会、投资者及所有利益相关者的协调行动,但一旦实施,新的DESH法案将会是印度的游戏规则改变者,并将极大有助于实现到2026财政年度使其成为5万亿美元经济体的目标。END

We at D'Andrea & Partners Legal Counsel constantly monitor the latest developments in the Indian market. If you have any inquiry or want to know more about SEZs in India, feel free to shoot an e-mail to: 

info@dandreapartners.com.

德恩瑞法律咨询的专业人员一直在关注印度市场的动向。如果您对印度的经济特区有任何疑问或想了解更多信息,请随时发送电子邮件至:

info@dandreapartners.com

Indias “SEZ 2.0” – A Move Forward for the Manufacturing Sector(图3)

Indias “SEZ 2.0” – A Move Forward for the Manufacturing Sector(图4)

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