HYDERABAD: The Export Promotion Council for
EOUs and SEZs on Thursday asked the RBI to consider the tax-free zones as infrastructure projects and not real estate to ease the pressure of high-interest borrowings on developers.
The Commerce Ministry has written to the apex bank urging infrastructure status for special economic zones. The units are suffering from liquidity crunch and the global slowdown is impacting project implementation, Export Promotional Council for EOUs a nd SEZs Director General L B Singhal said at a conference here. He further argued, when the government has considered
SEZ scheme as a vehicle for infrastructure development and creation of jobs, it must be classified under infrastructure, on par with th e industrial parks.
He said the Central government has already decided to provide service tax exemptions to SEZs for services provided outside the tax-free zones.
The Department of Commerce is working on extending the tax refund benefits to SEZs under the Duty Entitlement Passbook Scheme (DEPB) as well as Duty Drawback scheme. In addition, the Ministry of Finance would be coming out with directives to provide CEN VAT credit benefits for manufacturing within SEZs. India's exports plunged by over 12 per cent in October this fiscal under the impact of global slowdown. The aggregate export turnover registered Rs 66,600 crore from out of 87 SEZs being operated for t he year 2007-08 and targeted a turnover of Rs 1,25,000 crore for the current year 2008-09.
Source : Business Line