Government and Business Case Study

SEZ-Can the Chinese Model be Integrated in India?

OR

Abstract:
Special economic zones (SEZs) were considered foreign territory of a country, where relaxed financial and administrative rules were provided to attract investments. Many economists opine that SEZs were a weapon of developing nations by which they could trim down gaps with developed nations. Some others claimed that a handful of industrialists utilised tax benefits and other beneficial schemes and that the true purpose of SEZs were not achieved. However, the performance of SEZs varied from country to country. China was the first country, which successfully implemented a SEZ. India also introduced a SEZ but it was not as successful as the Chinese SEZs. The structure of SEZs widely varied in these two countries. Moreover, the socio-political scenario of China and India was in stark contrast. Bearing in mind the great differences between the Indian and Chinese SEZs, it was of great interest to observe whether India could achieve as much success as China in developing and running SEZs.

Pedagogical Objectives:

• To develop an idea regarding the SEZ and its salient purpose.
• To conceptualise the Chinese SEZ structure and the intrinsic factors behind its great success.
• To understand the Indian SEZ model and its challenges.
• To develop a comparative study between the Chinese and Indian SEZs.

Keywords :  Special economic zone, Free trade zone, Economic and technological development zones, Hi-tech industrial zones, Export processing zone, Multi-product activities, Shenzhen, Hainan, Santa Cruz, Cochin, Tax exemption, Single-product SEZs (special economic zones), Dislocation and loss of earning