A Special Economic Zone (SEZ) is a geographical region that has economic laws that are more liberal than a country's typical economic laws. The category 'SEZ' covers a broad range of more specific zone types, including Free Trade Zones (FTZ), Export Processing Zones (EPZ), Free Zones (FZ), Industrial Estates (IE), Free Ports, Urban Enterprise Zones and others. Usually the goal of such structure Zones is to increase foreign investment.
The worlds first known instance of SEZ had been found in an industrial park set up in Puerto Rico in 1947. In the 1960's Ireland and Taiwan followed suit, but in the 1980's China made the SEZs gain gobal currency with its largest SEZ being the metropolis of Shenzhen.
Apart from providing state-of-the-art infrastructure and access to a large well-trained and skilled work force, an SEZ also provides enterprises and developers with a favorable and attractive framework of incentives which include 100% income tax exemption for a period of five years and an additional 50% tax exemption for two years thereafter. Exemption from industrial licensing requirements and the no import license requirements is also given to the SEZ units. State Governments play a very active role in the establishment of SEZ unit.
A number ot Special Economic zones are proposed to kick off in Vadodara. With a multi-product SEZ on 3,380 hectares of land in Jambusar, Sterling Biotech has proposed Gujarat an investment of 1,600 crores. The SEZ will house priority sector industries such as chemicals and petrochemicals, metals and steel. The proposed SEZ is expected to provide jobs to 200,000 people in the next four years. Shri Chetan Sandesara, promoter of the land adjoining the government allotted near Dahej SEZ says," We are looking at industrial and infrastructure investment from major chemical and pharma companies around the world in the next three years. Apart from the strategic location of the SEZ to Vadodara which is well connected to the metres, another aspect working in our favour is that the Pollution effluent treatment channels pass through Sterling SEZ, making effluent management cost effective for the companies". At the Sterling SEZ alone, an estimated employment of 2.5 lakh jobs are expected to be generated in the next three years. The SEZ has entered into a contract with Virginia State, USA in which technical support shall be provided in SEZ setup and management and also recommend the zone to any Virginia based company interested in eyeing India as an outsourcing or expansion destination. Already MNCs like Bombardier, Alstom, ABB etc are availing benefits of the Electrical and Power SEZ at Vadodara. In the near future, Vadodara shall be the only second Asian destination for Aircraft maintenance and cargo handling with the proposal of a special aircraft maintenance terminal at Padra and upgrading of Vadodara domestic airport to an International grade Airport.
Diversity in industrial sector presence in Vadodara is a major advantage why the city is a favoured clean industrial destination. PSUs like Gujarat Refinery, GSFC, GACL AND ONGC as Well as private entities like Bombardier, Sterling Gelatin, Linde, Reliance, Birla Cellulosic drive a number of small and medium enterprises to setup shops in Vadodara and service the industrial giants. Vadodara is home to as many as seven GIDC zones each facilitating different trades from pharmaceuticals to B2B specialists, energy and power suppliers to heavy engineering services and metallurgy. Presence of such a diverse industrial environment gives confidence to new companies and emerging sectors allied with the industries to seek industrial shelter in Vadodara.