Special Economic Zones in India

Abstract

In the context of the ongoing debate on land acquisition in India and its relationship to development, this article presents an in-depth investigation of the characteristics of special economic zones (SEZs) in India. This includes the nature of exports and economic activity, their use of land and their location. It finds that a large majority of the SEZs are less than 1 sq. km, their exports focused on the information technology/information-technology-enabled service (IT/ITES) sector and refined petroleum, and located in a limited number of relatively advanced districts in a few states. Further, it is not the new SEZs, but the seven erstwhile EPZs and the 12 SEZs established between 2000 and 2005, which account for 90 per cent of the manufacturing exports from SEZs. Crucially, SEZs occupying 3 per cent of the land are responsible for 81 per cent of the total non-petroleum exports from SEZs. The nature of governance in these SEZs, which are also often seen as incipient urban settlements, is tenuous and non-representative. The article concludes with a discussion on the nexus of land, development and urbanization. It argues that the resistance to land acquisition is related to both acquisition processes and the relative costs and benefits of recent development initiatives, of which SEZs are an integral part.