Post by Rajan P. Parrikar
To Goanet -
The news coming out today is dismal on both the
On SEZs -
The Central govt is dithering on canceling the SEZs.
That is, the govt is buying time, almost surely at the
behest of the SEZ promoters. Digu and his cohorts
will be mighty relieved.
RESPONSE: While it is true, that it ain't over until the fat lady
sings; this is what came out now.....
Govt scraps 8 Goa SEZs
BS Reporter / New Delhi February 26, 2008
First reversal after last year's protests in the state.
As many as eight Special Economic Zones (SEZs) proposals in Goa were
scrapped at one stroke by the inter-ministerial Board of Approvals,
which met here today. The Board also decided to ask 12 developers in
the state why their zones should not be cancelled.
This is the first incident of a reversal of a Central policy,
following a strong anti-SEZ movement in Goa last year that had
threatened to bring down the Digambar Kamat-led Congress government.
SEZs are underwritten by a central law passed by Parliament in 2005
that permits special taxation and other fiscal benefits to the
developers and the units inside these zones.
The Goa government, on December 31, 2007, had recommended that the
Centre scrap all the zones in the state following widespread public
protests. Anti-SEZ protesters had argued that the zones will put extra
pressure on the already fragile infrastructure in the state and lead
to a dilution of the Goan identity.
Their argument was that ?outsiders? would flood Goa in search of SEZ
jobs that the locals will not be able to fill. This cancellation is
the first time in history that ethnic issues have led to reversal of
central industrial policy.
Formally approved zones that are facing withdrawal of status include
Inox Mercantile Company?s 48-hectare Biotech zone in Verna,
Panchbhoomi Infrastructure Pvt Ltd?s 18.5-hectare infotech zone in
North Goa and a 48-hectare Infotech zone of Paradigm Logistics in
?We are following the principle of natural justice and are sending
showcause notices to 12 formally approved zones. Proposals that were
sent by the state and were yet to be considered by the Board of
Approvals will be treated as withdrawn,? said Commerce Secretary Gopal
Krishna Pillai, who heads the board.
Three controversial SEZs in Goa ? Cipla?s Meditab Specialities,
Raheja?s IT/ITeS SEZ and Peninsula Pharma?s bio-tech SEZ ? which were
formally notified were, however, given a temporary reprieve, as the
board decided to launch formal talks with the Goa government on the
issue. The Goa government has been insistent on their denotification
The commerce ministry believes scrapping zones will send a wrong
signal to foreign investors. The ministry argues that even in the case
of denotification of the three zones, the industrial units built by
the developers will continue to exist.
Sources said that Cipla had already invested more than Rs 200 crore in
building two units at the Meditab zone.
Initially, the commerce ministry was of the view that notified zones
could not be de-notified. But Commerce Minister Kamal Nath had
subsequently said that denotification was an option that could be
exercised. The matter was then referred to the law ministry.
Sources said issues relating to compensation to SEZ developers, as
they have already pumped in money to set up industrial infrastructure,
will have to be addressed.
The commerce ministry is hopeful that even if 20 SEZs in the state are
axed, the three notified SEZs would continue to function.
Former minister Mathany Saldhana, who is leading the anti-SEZ
agitation, said: ?We consider today?s development a partial victory,
but nevertheless the first major step in saving our state that could
have lost its cultural heritage against the tide of the migrants
coming in for jobs. It would also have ruined Goa?s environment.
However, we vow not to rest till the three SEZs that have been
notified are completely withdrawn by the government?.
The Board of Approval today also gave formal approval to 10 zones, and
in-principle approval to 14 other zones spread across the country.
GOA?S PARADISE REGAINED
2007 September-December: Widespread protests in Goa against SEZs. Goa
government recommends to the Centre scrapping of all SEZs in the state
and denotification of three others.
2008 January: Commerce ministry officials say the SEZ Act does not
provide for denotification. Goa Chief Minister Digambar Kamat meets
Commerce Minister Kamal Nath, who says denotification is possible.
Issue referred to the law ministry.
2008 February: Law ministry says denotification of SEZs involves
compensation of the developers, who have already invested in
construction inside the zones.
Board of Approval decides that proposals of eight zones, which it had
not considered, will stand withdrawn.
Also decides to send showcause notices to 12 other formally and
in-principally approved zones.
DEV BOREM KORUM.