By IANS,
New Delhi : Exports from special economic zones (SEZs) and export-oriented units (EOUs) grew 418 percent between 2003-04 and 2007-08, Commerce Minister Kamal Nath said here Tuesday.
In an address at an awards function organised by the Exports Promotion Council for EOUs and SEZs, Kamal Nath said exports from SEZs and EOUs increased from Rs.426.41 billion (Rs.42,641 crore) to Rs.2.21 trillion (Rs.221,066 crore) – a growth of 418 percent – in four years.
“The SEZ success has been possible due to a participative and interactive approach between the government and industry. In the last three years, incremental investment of more than Rs.90,000 crore (Rs.900 billion) have taken place in the SEZs,” he said.
During this period, according to the minister, SEZs have provided employment for about 227,000 people.
Kamal Nath said exports from SEZs have gone up from Rs.228.4 billion (Rs.22,840 crore) in 2005-06 to Rs.666.38 billion (Rs.66,638 crore) in 2007-08. “By the end of December 2008, SEZ exports stood at Rs.700 billion (Rs.70,000 crore), crossing last year’s exports from SEZs,” he added.
“But we have issues (on sunset clause) confronting the SEZ sector and we would resolve these shortly,” he said. Under the sunset clause, SEZ are given tax holiday for a specified periods.
The minister said the government has, however, extended the sunset clause for EOUs by one year and was looking at extending it by three more years. “Now the income tax exemption is available up to March 2010,” he said.
Kamal Nath also downplayed apprehensions that the economic growth would slow down considerably. He said: “The GDP (gross domestic product) will grow by over 7 percent.”
Incidentally, India’s central bank itself has revised downwards its growth forecast to 7 percent from 7.5-8 percent predicted earlier.
Kamal Nath said he told delegates at the annual summit of the World Economic Forum in Davos last month that the Indian economy was driven by domestic demand, that its banking system was strong and that loan disbursement was taking place.
“The liquidity that has been made available to banks should now be translated into credit,” he said.
The minister also contested Commerce Secretary G.K. Pillai’s contention, made at the same forum earlier, that India’s merchandise exports would fall by as much as 22 percent in January because of the global economic meltdown.
“It’s too early to comment,” he said.
India’s merchandise exports registered a decline in December for the third straight month in dollar terms and were valued at $12.690 billion, down 1.1 percent over $12.825 billion logged during the like month of last fiscal.
Cumulatively, however, the exports grew 17.1 percent during the first nine months of the fiscal to $131.990 billion, against $112.737 billion during the corresponding period of the previous fiscal, official data showed Monday.
The government had already admitted that the target of $200 billion set for the current fiscal would remain unmet, expecting the year to end with a figure of $170 billion.