Export Processing Zone Scheme.
Export Processing Zone Scheme
-
Each Zone provides basic infrastructural facilities
- The Export & Import Policy
- The Development Commissioners
Export Processing Zone Scheme
Free Trade Zones (FTZ)/ Export Processing Zones (EPZs) have emerged as an
effective instrument to boost export of manufactured products. The Zones, set up
as enclaves separated from the Domestic Tariff Area (DTA) by physical barriers,
are intended to provide an internationally competitive duty free environment for
export production at low costs. The basic objectives of EPZs are to enhance
foreign exchange earnings, develop export-oriented industries and to generate
employment opportunities. The first Zone was set up at Kandla (Gujarat) in 1965,
followed by SEEPZ, Mumbai in 1972. Thereafter, four more Zones were set up at
NOIDA (UP), FALTA (West Bengal), Cochin (Kerala), Chennai (Tamil Nadu) in 1984
and at Vishakapatnam (Andhra Pradesh) in 1989. In 1997, Surat Export Processing
Zone came into existence. With the announcement of Special Economic Zone Scheme
in year 2000, the four Export Processing Zones / FTZ, namely Kandla, SEEPZ,
Cochin and Surat have been converted into Special Economic Zones with effect
from 1-11-2000.
- Each Zone
provides basic infrastructural facilities, like developed
land, standard design factory buildings, built-up sheds, roads, power supply
and drainage, in addition to a whole range of fiscal incentives by way of
Customs, Excise and Income Tax exemptions. Customs clearance facilities are
offered within the Zone at no extra charge, while facilities like banking,
post office and clearing agencies are also available in the service centers
attached to each Zone.
- The Export & Import Policy provisions for Export Processing Zones are
the same as applicable to EOUs. Thus, the provisions of EXIM Policy
regarding importability of goods, DTA sale, clearance of samples,
sub-contracting, inter-unit transfer, repairs, re-conditioning and
re-engineering, sale of unutilized material, debonding etc. for EOUs are
applicable to EPZ units.
- The Development Commissioners appointed by the Ministry of Commerce
monitor and coordinate the functioning of each Zone. The Customs act in
close liaison with the Development Commissioner of the respective Zone in
providing bond facilities and for ensuring that goods imported/indigenously
procured duty free are utilised in the production of goods for export. To
enable the EPZs to import/procure locally their requirement of raw
materials, capital goods and office equipment etc. duty free, a number of
Customs and Central Excise notifications have been issued by the Ministry of
Finance. These notifications specify the different categories of items
allowed to be imported/procured duty free as well as the conditions thereof.
The permissible item, cover almost all categories of goods required in
connection with the production activity for export & include capital goods,
raw materials, components, packing, consumables, spares etc. The relevant
notifications are as under:-
- 133/94-Cus, dated 22.6.1994 for allowing duty free import of
specified goods to the units located in the Export Processing
Zone;
- 58/2000-Cus, dated 8.5.2000 for allowing granite-quarrying
units located in the Export Processing Zone to import specified
goods duty free;
- 177/94-Cus, dated 21.10.1994 for allowing Gems & Jewellery
units located in the Export Processing Zone to import specified
goods duty free;
- 126/94-CE, dated 2.9.1994 for allowing EPZ units to procure
locally the specified goods duty free;
- 37/2000-CE, dated 8.5.2000 for allowing granite-quarrying
units located in the Export Processing Zone to procure specified
goods duty free;
|
As the policy provisions for units located in Export Processing Zone are the
same as those applicable to EOUs, for details the chapter on EOUs may please
be referred to. It may be mentioned that in case of EPZ, the units are not
required to take licence under section 58 of the Customs Act. Further, the
EPZ units are not required to pay cost recovery charges for the Customs
staff posted in the Zone.