The government is considering a common framework for export-linked schemes, including special economic zones (SEZs), export-oriented units (EOUs), the Export Promotion Capital Goods (EPCG) scheme, Manufacture and Other Operations in Warehouse Regulations (MOOWR) and Advance Authorisation. According to reports from Essential Business Intelligence, this initiative aims to make it easier for businesses to switch between schemes while addressing the current practice of 'scheme shopping' where businesses choose between schemes based on differences in their rules and benefits. The proposed framework would bring SEZs, EOUs, EPCG, MOOWR and Advance Authorisation under a more common set of rules, with businesses able to switch between schemes more easily.
The proposed framework seeks to bring common rules for areas such as definitions, interest and depreciation benefits across all export schemes. As reported by Essential Business Intelligence, the Commerce Ministry is preparing draft norms in consultation with the Finance Ministry to implement these uniform provisions. The wider SEZ revamp could also cover duties, job work and rules governing contiguous land, providing a more streamlined approach to export-related operations. The government is separately working on a broader revamp of the SEZ framework, with the changes potentially covering duties, job work and rules on contiguous land.
SEZs may soon be allowed to receive rupee payments from domestic clients, which could benefit defence, maintenance, repair and overhaul (MRO), engineering and information technology companies operating from SEZs. According to sources cited by Essential Business Intelligence, this change would make payments from domestic clients easier for these sectors. The proposed changes are part of the government's broader effort to simplify rules across export-linked schemes and SEZs, with the move specifically aimed at addressing 'scheme shopping' and making business operations more flexible.
A Cabinet note on the 'definition of services' under SEZ rules is also under consultation, as reported by Essential Business Intelligence. The Commerce Ministry is preparing the draft norms in consultation with the Finance Ministry to ensure comprehensive regulatory alignment. This consultation process reflects the government's commitment to creating a unified approach to export-linked schemes and SEZ operations across different sectors and industries, with the government separately working on a broader revamp of the SEZ framework to address various operational aspects.
