MUMBAI: Till last year, Special Economic Zones (SEZs) were the flavour of the season. But for some developers, the downturn in the global economy is now forcing them to surrender their SEZs despite having received formal approvals from the Centre.
On Tuesday, the Board of Approval of the ministry of commerce and industry in Delhi will deliberate on half a dozen proposals by two developers construction giant DLF and the Mumbai-based K Raheja Universal to denotify their SEZs.
Both the developers have cited global slowdown in the IT sector as reasons for scrapping their SEZs. DLF, the country's largest real estate company, has requested the Board of Approval to denotify four of its approved SEZs 25 acres in Gujarat, 25 acres at Rai, Sonepat in Haryana, 25 acres in Kolkota and another 25 acres in Bhubaneswar in Orissa.
Raheja Universal controlled by Suresh Raheja, the youngest of the Raheja brothers who split about two decades ago, has requested the board to denotify its 50-acre IT/ITES SEZ in Navi Mumbai and also sought part denotification of a portion of its 30 acre SEZ in the same area.
According to sources, Raheja Universal approached the board with a proposal to surrender its SEZ, citing economic recession in the IT industry. The company has been selling of its land bank for the past several months now.
Last month, the realty company sold its Wallace Flour Mills property at Mazgaon for a substantial loss following pressure from a private bank to shore up its hefty loans.
In DLF's case, the board in its meeting on Tuesday will consider if the realty major had benefitted from the duty free benefits offered to SEZs and whether it should be returned to the government.
In Maharashtra, as many as 109 SEZs have received a formal go-ahead while another 35 have got in-principle approval by the union ministry of commerce and industry so far. Incidentally, Maharashtra has the largest number of SEZs in the country.
The SEZs which have received formal approvals by the board of approvals in Delhi are cases where the developers have got complete possession and ownership of the land to be developed.
Six of the approved SEZs are located in Mumbai itself. They are Hiranandani Builders' 31 acres proposed information technology (IT) zone at Powai, Royal Palms India's 24 acres (IT) in the heart of Aarey Milk Colony in Goregaon (east) and another 24 acres for a gems and jewellery SEZ in the same region, Chiplun Infrastructure's 99 acres (location not given) for a warehousing zone, Bombay Industrial Corporation's IT SEZ on 30 acres in Mahul and Ferrani Hotels Private Ltd/Ozone Developers 69 acres for a IT zone in Malad.
Source:The Times Of India