Centre trims size of SEZs

Bowing to political pressure, the Centre today decided that no SEZ would be allowed beyond 5,000 hectares of land and States will not acquire land for industry, reports PTI. In the middle of a raging debate on SEZ policy, especially in the wake of the Nandigram violence, the empowered Group of Ministers took these decisions here.

At the same time, the GOM, headed by Foreign Minister Pranab Mukherjee, gave a clear signal that new SEZ norms would not compromise the industrialisation process and lifted the freeze, clearing 83 new projects.

“No state can compulsorily acquire land from farmers through land acquisition act,” Commerce Minister Kamal Nath told reporters, adding that promoters would have to themselves go to farmers and acquire land at commercial rates.

Further, the states would be empowered to reduce the size of SEZs below the 5,000 hectare limit set by the Centre.

Nath said under the new Relief and Rehabilitation Policy, which would be finalised soon, at least one member of the displaced family would have to be employed in the project. This would be in addition to the compensation paid to farmers.

With the freeze lifted, the government would approve all pending applications where there is no land dispute.

Of the 234 SEZs with formal approvals, 63 have already been notified, while 83 more were today cleared for notification. The Board of Approvals will now take up 162 SEZs with in-principle approval and 140 pending applications.

The decision on limiting the size would hurt plans of companies such as Reliance Industries, besides real estate players DLF and Omaxe, which plan to set up mega SEZs.

The GoM decision to limit the size of SEZs to 5,000 hectares comes after Maharashtra turned down the Centre’s request to review the size of 10,000 hectare Maha Mumbai Zone promoted by Reliance Industries.

When contacted, a Reliance Industries spokesperson declined to comment.

It may be noted that both RIL’s Maha Mumbai SEZ as well as the one proposed in Haryana have received only ‘in- principle’ approvals.

Nath said Rural Development Ministry has been asked to amend the Land Acquisition Act and make it more comprehensive.

He said Relief and Rehabilitation Policy is already under preparation by the Rural Development Ministry.