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Sez Rush In India

SEZs have become the most talked about in theagricultural  prospects.'
Indian economic circles, its lack of clear
policy has provoked strong opposition fromCapping months of debate on the pros and cons
leftist political parties, activists, farmersof developing Special Economic Zones (SEZs),
groups, economists and urban planners.the commerce ministry has issued a caveat
However the government of India is movingthat prime agricultural land should not be
ahead with the programme to set up specialused for business purposes India's commerce
economic zones (SEZs) to trigger aministry has asked the chief ministers of all
manufacturing wave in the country. AmidIndian states to ensure that prime
evidence of an undercurrent of ruralagricultural land was not allotted to
hostility to giant industrial zones coming upbusiness houses for development as Special
on agricultural land, Posco, a South KoreanEconomic Zones (SEZ), and that in any event
steel company, was last week permitted to setagricultural land must not exceed 10% of the
up a 1,600ha SEZ in mineral-rich Orissaland allotted. The commerce ministry's
state.clarification, which also underlines that
farmers be adequately compensated for their
Posco plans to invest 530 billion rupeesland and rehabilitated fairly, comes in the
(S$18 billion) in the zone. Some 30 other SEZface of mounting concern that diverting
applications have now won the backing of theagricultural land for the development of
Board of Approvals, taking the total numberbusiness interests, that too at government
of SEZ proposals cleared to 181. Therates, was riding roughshod over the
government sees boosting manufacturing asinterests of India's farmers. This has come
crucial to balancing the country's economicas a reality check for state governments that
growth. Untypical for a developing country,have been aggressively pushing their SEZ
India's services sector contributes about 54proposals for clearance from the Centre. So
per cent of GDP. Economists say a China-stylefar, the Indian government has handed out
push to manufacturing is needed to provideover 150 licenses to set up SEZs; another 200
jobs for the unemployed and those migratingapplicants are on the waiting list. However,
from  farm  work.the chief minister of Andhra Pradesh - the
biggest beneficiary of SEZs so far has
But SEZs also have raised some controversy incategorically ruled out any review of SEZs
India. Finance Minister P. Chidambaram hasalready cleared for the state. It said
warned of massive revenue losses because ofthat SEZs should serve as a bridge between
the tax breaks accorded to companies in therural and urban economies. The concept of
zones. With SEZ being under the charge of thePURA (Provision of Urban Facilities in Rural
Commerce Ministry, there has been a turf warAreas), which is how developed countries have
of sorts between him and Commerce Ministerholistically conceptualized their rural
Kamal Nath. As well, several politicalhabitations, needs to be remembered at a time
leaders are uncomfortable about pushingwhen India is entering an era of SEZs. The
farmers off land in a nation where six in 10explosion in the economy envisaged through
people depend on agriculture for a living.SEZs will have to be linked to integrated
Mrs. Gandhi, who chairs the ruling coalition,infrastructure in rural and urban areas.
said: 'Prime agricultural land should not beIndia should focus on comprehensive and
diverted to non- agricultural uses and, evenintegrated spatial planning within and beyond
if this is resorted to for unavoidableSEZs. This however is a dream come true here.
reasons, this should not jeopardize



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