Adani seeks partial de-notification of its multi-product SEZ in Gujarat; govt to take up matter on Jan 24

New Delhi: Adani Ports & Special Economic Zone Ltd has approached the Centre for partial de-notification of its multi-product SEZ in Mundra, Gujarat, and the proposal will be taken up by the commerce ministry on Friday.

The proposal will be discussed in the meeting of the Board of Approval, the highest decision-making body for special economic zones (SEZs). The board, headed by Commerce Secretary Sunil Barthwal, will meet here tomorrow.

"Adani Ports & Special Economic Zone (APSEZ) Ltd has requested for partial de-notification of 333.7396 out of 8282.7670 Ha. As regards reasons, the developer has submitted that due to stiff competition in the solar market and severe dumping of solar equipment into India, the units in EMC (Electronics Manufacturing Cluster) are becoming economically unviable within the SEZ," according to the agenda of the meeting.

To survive in this difficult market, it has become essential for these units to exit from SEZ, it noted.

"In view of this, the constituent units in the EMC area have desired not to continue their operations in SEZ format. Hence, the co-developer, Mundra Solar Technopark has requested the developer to de-notify the EMC area from SEZ on the as-is-where-is basis," the proposal said. Gujarat has given no objection to the proposal and requested to process the application of partial de-notification, it said.

The development commissioner of APSEZ has also requested the board to consider this proposal.

As per the SEZ Rules, 2006, the central government may -- on the recommendation of the Board on the application made by the developer, if it is satisfied, modify -- withdraw or rescind the notification of a SEZ.

Further, the inter-ministerial board would also take up a proposal of Mundra Petrochem Ltd, APSEZ, Mundra for a grant of LOA (letter of approval) extension for one year.

While the LOA was issued in December 2021, due to the COVID pandemic and other issues, the start of the project and commissioning were rescheduled, the agenda said, adding that now, the project activities are progressing in full swing.

SEZs are key export hubs, which contributed over one-third of the country's total outbound shipments in the last fiscal.

These zones are enclosures that are treated as foreign territories for trade and customs duties, with restrictions on duty-free sales outside these zones in the domestic market.

As many as 423 such zones have been approved by the government, out of which 280 are operational. As many as 5,711 units are approved in these zones.

Exports from these zones rose by over 4 per cent to $163.69 billion in 2023-24.