{"id":347842,"date":"2025-10-11T07:07:41","date_gmt":"2025-10-11T01:37:41","guid":{"rendered":"https:\/\/forumias.com\/blog\/?p=347842"},"modified":"2025-10-12T10:40:50","modified_gmt":"2025-10-12T05:10:50","slug":"need-to-reposition-sezs-for-integrated-national-development","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/need-to-reposition-sezs-for-integrated-national-development\/","title":{"rendered":"Need to reposition SEZs for integrated national development"},"content":{"rendered":"

Source<\/strong>: The post \u201cNeed to reposition SEZs for integrated national development\u201d <\/strong>has been created, based on \u201cReposition SEZs for integrated national development\u201d<\/strong> published in “Business Line\u201d<\/strong> on 11 October 2025. Need to reposition SEZs for integrated national development.<\/strong><\/p>\n

\"Need<\/p>\n

UPSC Syllabus: GS Paper 2 \u2013 Governance<\/strong><\/p>\n

Context: <\/strong>The Special Economic Zones Act, 2005<\/strong> was enacted to promote exports, attract foreign investment, generate employment, and develop world-class infrastructure. Two decades later, despite several successes, SEZs have not fully realised their transformative potential. With India\u2019s renewed focus on \u201cAatmanirbhar Bharat\u201d<\/em> and \u201cViksit Bharat @2047\u201d<\/em>, a strategic repositioning of SEZs is essential for integrated and inclusive national development.<\/p>\n

Current Status of SEZs<\/strong><\/h2>\n
    \n
  1. SEZs replaced Export Processing Zones (EPZs)<\/strong> in 2000.<\/li>\n
  2. As of June 30, 2025<\/strong>, 370 SEZs have been notified<\/strong>, out of which 276 are functional<\/strong>, comprising 6,279 approved units<\/strong>.<\/li>\n
  3. Around 60% of exports<\/strong> originate from services sectors<\/strong> like IT\/ITeS, while manufacturing SEZs remain underperforming.<\/li>\n
  4. Nearly 200,000 hectares<\/strong> of developed land and 100 million sq. ft.<\/strong> of built-up space remain partially utilised.<\/li>\n
  5. Hence, while SEZs have created pockets of excellence, the national spillover effects are limited.<\/li>\n<\/ol>\n

    Need for Repositioning<\/strong><\/h2>\n
      \n
    1. Underutilisation of Potential: <\/strong>A significant portion of the developed land within Special Economic Zones (SEZs) remains unutilised, indicating a gap between planned infrastructure and actual industrial activity.<\/li>\n
    2. Skewed Sectoral Growth: <\/strong>The overwhelming dominance of the services sector, as opposed to manufacturing, has reduced the employment intensity of SEZs and limited their contribution to large-scale job creation.<\/li>\n
    3. Global Supply Chain Realignment: <\/strong>In the post-pandemic world, there is a growing need for diversified and resilient production bases. India must reposition its SEZs to attract global investors seeking alternatives to concentrated manufacturing hubs.<\/li>\n
    4. Alignment with National Schemes: <\/strong>SEZs need to be strategically integrated with national flagship initiatives such as the Production Linked Incentive (PLI) Scheme, Industrial Corridor Projects, and the \u2018Vocal for Local\u2019 campaign to maximise synergies and policy coherence.<\/li>\n
    5. Export Competitiveness: <\/strong>Comprehensive reforms are essential to sustain and enhance India\u2019s export competitiveness, especially in light of tightening global trade norms and the evolving framework of free trade agreements.<\/li>\n<\/ol>\n

      Key Policy Recalibrations Proposed<\/strong><\/h2>\n
        \n
      1. 1. Permit Sale to Domestic Tariff Area (DTA)<\/strong><\/li>\n<\/ol>\n