Decision on Goa SEZs
next month
Agencies, New Delhi
17 January 2008
The Board of Approval for Special Economic Zones may ask
the Goa government to pay compensation to the developers of
the three notified zones in the state for scrapping these
projects.
"The matter would be discussed at the Board of Approval
in February. We will not take a hasty decision, considering
that the SEZs are already notified and investments have been
made. One option before the Goa government is to compensate
the developers for the investments that they have made. It
is up to the state government to negotiate with the developers
and avoid litigation," said a commerce ministry official.
Commerce Minister Kamal Nath said the SEZ Act had been very
successful and had generated employment and investment.
"There is no rethinking on the Act. The Goa chief minister
has written to us and we are studying the matter. The government
is not thrusting anything on states. It is for the states
to take a decision on the kind of development model that they
would like to have," said Nath on the sidelines of the
CII Partnership Summit in Gurgaon.
Notified zones in Goa include a 123.2-hectare biotech SEZ
of Meditab Specialities, a 107.17-hectare services SEZ of
K Raheja Corp Pvt Ltd and a 20.36-hectare Biotech SEZ of Peninsula
Pharma Research Centre Pvt Ltd.
In December, 2007, the Goa government had decided to scrap
the 12 SEZs in the state and recommend to the central government
to de-notify the three notified ones.
Commerce Ministry officials had earlier said that de-notification
of zones was not an option as the SEZ Act of 2005 did not
have any provisions on the matter.
Subsequently, the Goa government wrote to the commerce ministry,
stating that the state did not need these SEZs.
Moreover, the state government also said that there was not
enough power available in Goa to provide the tax-free zones.
SEZ experts said the complex dispute can only be sorted out
if the developer withdraws the application for the zone.
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