Special Economic Zones (SEZ) in India.
Introduction
A Special Economic Zone in short SEZ is a geographically bound zones where the economic laws in matters related to export and import are more broadminded and liberal as compared to rest parts of the country. SEZs are projected as duty free area for the purpose of trade, operations, duty and tariffs. SEZ units are self-contained and integrated having their own infrastructure and support services.

Within SEZs, a units may be set-up for the manufacture of goods and other activities including processing, assembling, trading, repairing, reconditioning, making of gold/silver, platinum jewellery etc.

As per law, SEZ units are deemed to be outside the customs territory of India. Goods
6. Detailed guidelines on setting up of SEZ in the Private/Joint/State Sector is given in Appendix 14-II.N of Handbook of Procedures Volume I.

Advantages & Disadvantages of SEZ

A SEZ unit which has been set up for carrying on manufacturing, trading or service activity has both advantages as well as disadvantages. SEZ advantages are quite far more as compared to its disadvantages which are almost negligible.

Advantages * 15 year corporate tax holiday on export profit – 100% for initial 5 years, 50% for the next 5 years and up to 50% for the balance 5 years equivalent to profits ploughed back for investment. * Allowed to carry forward losses. * No licence required for import made under SEZ units. * Duty free import or domestic procurement of goods for setting up of the SEZ units. * Goods imported/procured locally are duty free and could be utilized over the approval period of 5 years. * Exemption from customs duty on import of capital goods, raw materials, consumables, spares, etc. * Exemption from Central Excise duty on the procurement of capital goods, raw materials, and consumable spares, etc. from the domestic market. * Exemption from payment of Central Sales Tax on the sale or purchase of goods, provided that, the goods are meant for undertaking authorized operations. * Exemption from payment of Service Tax. * The sale of goods or merchandise that is manufactured outside the SEZ (i.e,