China’s Policy for Special Economic Zone

Abstract

Though India’s SEZ policy owes its conceptual base to the successful Chinese SEZs’ experience, hardly any attempt has been made to explain what made the latter so successful. In this article, we trace this phenomenal success to the well articulated and executed SEZ policy in China. Apart from this, the success of SEZs in China is also attributed to the various supporting mechanisms, both internal and external factors. On the basis of this analysis of different factors, we argue that SEZs cannot be expected to deliver optimum performance under ceteris paribus conditions; rather it requires careful identification and implementation of supportive factors, which may vary between countries, SEZs and/or between sectors within a given economy.