News: RIL, DLF, others forced to alter SEZ plans

(DNA 06/04/2007) Mumbai - The freeze on SEZ approvals since December is now gone. About 1,000 proposals, currently at various stages from drawing board to implementation, can now move forward. But politics following violence in Nandigram and farmers' protests elsewhere has taken their toll. SEZs can now come up but by complying with more stringent rules. Some of the mega projects belonging to developers such as Reliance Industries, Mahindra & Mahindra, Korean steel giant Posco, DLF, Omaxe and the Salim Group of Indonesia, which have land-related issues to tackle, may be forced to be modified or abandoned in the wake of the tightening of rules. The empowered group of ministers (EGoM) on Thursday decided to stop land acquisition for SEZs by state governments, and prescribed a ceiling on the size of SEZs at a maximum of 5,000 hectares and restricted the use of land for purpose other than "processing" inside a zone to maximum 50% from earlier 35%. In addition to fending for itself in "buying" land from the farmer, the developer will also have the extra burden of providing job to at least one person from each displaced family under a "comprehensive rehabilitation policy" being finalised by the Centre. While the Centre has now fixed upper limit of area for multiproduct SEZs at 5,000 hectares, the state governments may prescribe a lower limit, commerce and industry minister Kamal Nath said. The minimum processing area limit will be fixed uniformly at 50% for multi product SEZs as well as sector specific SEZs. Earlier, the minimum processing area requirement for multiproduct SEZs was 35%, with a provision for relaxation up to 25% by the Board of Approvals; and it was 50% for sector-specific SEZs. In respect of pending applications for SEZs, these may be processed for in principle, formal approval and notifications subject to the condition that the state governments would not undertake any compulsory acquisition of land for such SEZs, Nath said. Notification in respect of the 83 cases of formal approvals, documents for which have been submitted by the developers will be issued by the department of commerce after verification, including issues concerning any dispute relating to land. In respect of other formal approvals, notifications may be issued as and when the proposals are received and verification procedures are completed. The ministry of rural development has been asked to reformulate a comprehensive Land Acquisition Act to address all relevant issues. A resettlement and rehabilitation policy will be worked out ensuring livelihood from the project to at least one person from each displaced family. Regarding the decisions on processing area and minimum size requirement, Nath said "the decisions will be applicable to all SEZs, including 63 which have already been notified.