Legal experts and policymakers are advocating for the expansion of India’s Special Economic Zone (SEZ) framework into remote and underdeveloped regions. While SEZs were initially established to resolve industrial challenges like high taxes and complex procedures in urban hubs, extending them to rural areas could bridge regional development gaps. This geographic evolution is seen as a key step toward inclusive and balanced national economic growth.
The proposed expansion aims to attract industries to districts with limited economic activity, thereby creating local jobs and improving basic infrastructure like roads and internet connectivity. By offering special tax breaks, customs benefits, and streamlined regulations through a single-window clearance system, these remote zones can encourage local entrepreneurship. This shift is also intended to reduce the trend of mass migration to overcrowded big cities.
The current legal framework, governed by the SEZ Act of 2005 and subsequent amendments, provides a foundation for this expansion. Businesses within these zones enjoy duty-free procurement of raw materials and machinery, as well as significant income tax deductions on export profits. As global companies seek alternatives to traditional manufacturing hubs, liberalizing SEZ rules in remote India presents a rare opportunity to position the country as a reliable global partner.