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Delhi paves way for inroads to rural areas

July 23, 2010

Pushing growth further inland, New Delhi has relaxed the minimum built-up area norms for Special Economic Zones coming up in smaller cities. In a recent notification, the Commerce Ministry listed 21 cities as B1 (these include small cities such as Patna and Ludhiana, Kochi, Agra, Allahabad, Madurai, and Raipur), for which the Government has pruned the minimum built-up area for SEZs to 50 per cent of the current norms. For ‘B2′ cities (ie locations that are smaller than B1 cities), the minimum built-up area has been lowered to just 25 per cent of the present norms.

The move which is aimed at removing the adverse impact of the Direct Taxes Code on Special Economic Zones is also expected to boost entrepreneurship and give a fillip to the IT/ ITeS, gems and jewellery, non conventional energy, biotechnology and free trade warehousing industries, where minimum built up area norms are prescribed. The built up area norms pertains to the processing area where production takes place; this is at least 50 per cent of the total SEZ area.

In order to develop inroads into India’s rural areas and cultivate inclusive growth, the Indian government has also decided to rope in the private sector for building rail lines and connectivity projects to create additional rail transport capacity in the country.

According to the new scheme by the railway ministry private firms that invest in rail connectivity projects would receive discounts on freight charges. The policy aims at making railways a more competitive option for prospective customers and also help increase the railways’ freight business.


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