An Analysis of Special Economic Zones in India

India was one of the first in Asia to recognize the effectiveness of the Export Processing Zone(EPZ) model in promoting exports, with Asia`s first EPZ set up Kandla in 1965.In order to overcome the shortcoming experienced on account of the multiplicity of controls and clearances; absence of world class infrastructure, and an unstable fiscal regime and with a view to attract larger foreign investment in India, the special Economic Zones(SEZs) policy was announced in April 2000.Special Economic Zones (SEZs) can be compared to their producers, Free Trade Zones and Export Processing Zones in that they are aimed at stimulating foreign direct investment (FDI) and rapid export-laid industrial growth. The essential characteristics of such schemes is that they allow the by-passing of particular social legislation or tax provisions which are perceived to be an impediment to progress or the competitiveness of an export oriented activity. SEZs have shown a dramatic rate of growth with total exports of Rs. 12,96,890 million during the financial year 2012-2013, a growth of 50% over the exports for the same period of the previous year. Exports in the first three quarters of the 2013-2014 previous financial year financial years registered a growth rate of about 137% over the corresponding period of the 2013.