ANDHRA PRADESH, today, is the front runner in the number of special economic zones (SEZs). Of the 568 notified SEZs in the country, 68 are in Andhra Pradesh, and of the 315 approved SEZs (as on May 13), as many as 103 are in the State.
The Visakhapatnam SEZ is one of the eight SEZs run by the Central government. Established in 1989 as the Visakhapatnam Export Processing Zone, it became the VSEZ with effect from January 1, 2003. Spread over 360 acres at Duvvada, it is close to the airport and the public sector Visakhapatnam port and the private sector Gangavaram port.
At present, the zone has 74 units, and its exports for 2008-09 were to the tune of Rs.901.84 crore. The VSEZ has jurisdiction over Andhra Pradesh, Chhattisgarh and Yanam (a region of Puducherry). According to M.S. Rao, Development Commissioner for the VSEZ and 100 export-oriented units (EOUs) in Andhra Pradesh, Chhattisgarh and Yanam, when the SEZ Act 2005 came into force on February 2, 2006, it gave private players an opportunity to establish SEZs and create infrastructure facilities. The SEZ Act 2005 and the SEZ Rules 2006 provide many incentives such as customs and excise duty exemption on the procurement of capital goods and raw materials, income tax benefits, and service tax exemption and refund. The benefits are available to both developers and units.
The SEZs can be classified into three categories, namely, multi-product, sector-specific, and free trade warehousing SEZs. Out of the 68 notified SEZs in the State, four the Andhra Pradesh Industrial Infrastructure Corporation (APIIC) SEZ at Achutapuram in Visakhapatnam, the Sri City SEZ in Chittoor, the Kakinada SEZ in East Godavari and the APIIC SEZ at Naidupet in Nellore district have come up as multi-product zones. In the sector-specific category, information technology has 39 SEZs.
At present, five of the non-IT SEZs the APIIC multi-product SEZ at Achutapuram, the Brandix SEZ, Divis Laboratories, Ramky Pharma SEZ and the Apache SEZ are operational. The Parry SEZ at Kakinada and the Sri City SEZ are expected to be operational in the current fiscal.
The Apache SEZ was given formal approval in 2006 and became operational in a year, with an export turnover of Rs.153 crore in 2008-09. Also within one year of approval, Divis Laboratories launched its operations, with an export turnover of Rs.461 crore in 2008-09.
From the APIIC multi-product SEZ, it is expected that Pokarna Limited will be the major exporter in 2009-10 as it started commercial production in March 2009. Other units that have started production are Uniparts Ltd and Confidence Petroleum Products. Silkroad Sugar Private Ltd in the Parry SEZ is a stand-alone raw sugar-based refinery with an initial refining capacity of six lakh tonnes. It is a joint venture between the Murugappa Group and Cargill of the United States. The unit has taken off in record time. It has a 35-megawatt gas-based power plant for cogeneration of power.
M.S. Rao said the establishment of private SEZs could attract an investment of over Rs.6,000 crore and provide direct and indirect employment to about 50,000 people. In a short time, private SEZs have generated exports worth Rs.2,160 crore, he added. A striking feature of Andhra Pradeshs SEZ policy is that the SEZs are widespread, giving the State scope for overall development.
Santosh PatnaikCOMMents
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