RIL returns SEZ land to Haryana government
RIL says withdrawal of the concessions offered to SEZs has made such projects unviable
Mumbai: Reliance Industries Ltd (RIL) has returned to the Haryana government 1,383 acres of land which it had purchased for development of a special economic zone (SEZ).
The SEZ was being set up by Reliance Haryana SEZ Ltd, a joint venture between Reliance Ventures Ltd, a wholly owned subsidiary of RIL, and Haryana State Industrial and Infrastructure Development Corporation (HSIIDC).
A note issued by RIL on Saturday said since the concessions offered to an SEZ project such as minimum alternate tax and dividend distribution tax have now been withdrawn, this has made such projects unviable.
The said SEZ was proposed to set up a model economic township and other infrastructure facilities where several global firms could come and set up shop, the RIL note said.
It added that the model township will continue to be developed on the directly purchased land based on the current concessions available for such a project.
RIL had entered into a joint venture with HSIIDC in 2006 to set up a multi-product SEZ in Haryana and the land was transferred to the JV in 2007. Later, the project was approved in 2010 and work began.
However, in 2011, the Indian government withdrew the concessions available to SEZs when RIL decided to walk out of the project.
HSIIDC has also exited the JV, the note said.
However, while the economic township has already been built over 209 acres based on directly purchased land, seeing interests from various companies, RIL has sought a licence for another 415 acres, the note said.
In fact, SEZs have been a classic case of failed and stalled projects in India with several SEZs envisioned under the first term of the United Progressive Alliance government are either surrendered or are teetering at the brink of being a failure.
Prime Minister Narendra Modi on 16 August said that its government is willing to revive several stalled SEZs as that is the beat way to give a boost to the country’s exports.
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