GIDC to impose ‘premium’ on private SEZ developers

“Idle” land belonging to private developers who have “denotified” their Special Economic Zones (SEZs) in the last few years is becoming a matter of concern in Gujarat.

Ahmedabad | Published: April 19, 2013 5:15 am

“Idle” land belonging to private developers who have “denotified” their Special Economic Zones (SEZs) in the last few years is becoming a matter of concern in Gujarat.

Now,Gujarat Industrial Development Corporation or GIDC,which promotes industrialisation in the state,has decided to free about 200 hectares of land blocked under denotified SEZs after charging a “premium”.

“For quite sometime,industrialists have not been coming forward to set up units in these SEZs because of which the land has been lying idle. Due to this,SEZ developers have sought full or partial denotification (of their SEZs) and have approached the authority requesting to convert it into domestic tariff area (DTA) or are seeking permission to sell it to other industrialists by sub-dividing the area into various smaller plots of land,” states the GIDC circular.

Under the new guidelines,if a SEZ developer wants to use a denotified area for his own business (captive use),he has to pay 15% of the amount it had paid GIDC for that particular land parcel.

In case a developer plans to transfer the entire plot of land to one person or a private company,he has to pay 25% of the total amount.

However,if the developer plans to divide the land into smaller plots and transfer it to different businesses,the charges will vary between 30-50% depending on the number of plots (between 1-25) the original land has been sub-divided into.

However,these guidelines are only applicable to private SEZ developers who sought land from GIDC for their respective SEZs.

So far,the 10 private SEZ developers who got their SEZs denotified in Gujarat have either acquired land from private land holders or state government or GIDC. “These guidelines from the GIDC will free about 200 hectares of land that have been lying unused in industrial clusters owned by the GIDC,” a senior state government official said on the condition of anonymity.

Gujarat is the not the only state which has decided to impose a premium fee on SEZ developers wanting to utilise their idle land after denotification.

“A similar move is being contemplated in Maharashtray. Such a move will not only free the land blocked under SEZs and ensure that genuine industralisation happens,but the imposition of additional charges will also act as a deterrent against possible land-grabbers,” says Nirav Kothary,the country head of industrial real estate at Jones Lang LaSalle (JLL).

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