Nod to MSTI, Aequs Group SEZ proposals after norms relaxed: Govt

New Delhi: The Board of Approval for special economic zones (SEZ) has approved the proposals of Micron Semiconductor Technology India Pvt Ltd (MSTI) and Hubballi Durable Goods Cluster Private Ltd (Aequs Group) for setting up such zones for manufacturing of semiconductors and electronic components, the government said Monday.

The approvals came after India eased the regulations for semiconductor and electronics component manufacturing in SEZs on June 3, commerce and industry ministry said.

Micron will establish its SEZ facility in Sanand, Gujarat over an area of 37.64 Ha with an estimated investment of Rs 13,000 crore while Aequs will establish its SEZ in Dharwad, Karnataka over an area of 11.55 Ha to manufacture electronics components with an estimated investment of Rs 100 crore.

“Since manufacturing in these sectors is highly capital intensive, import dependent and involve longer gestation periods before turning profitable, rule amendments have been carried out to promote pioneering investments and boost manufacturing in these high technology sectors,” the ministry said.

After amendments in the SEZ Rules, 2006, an SEZ set up exclusively for the manufacturing of semiconductors or electronic components will require a minimum contiguous land area of only 10 hectare, reduced from the earlier requirement of 50 hectare.

The amendments also allow the Board of Approval for SEZs to relax the condition requiring SEZ land to be encumbrance-free in cases where it is mortgaged or leased to the central or state government or their authorized agencies.

Another amendment allows the value of goods received and supplied on a free-of-cost basis to be included in Net Foreign Exchange (NFE) calculations and assessed using applicable customs valuation rules. Moreover, SEZ units in semiconductor and electronics component manufacturing sector can also supply domestically into the Domestic Tariff area as well after payment of applicable duties.

“The amendments will boost high-tech manufacturing in the country, spur growth of semiconductor manufacturing ecosystem and create high skilled jobs in the country,” the ministry said.