NEW DELHI : A 17-member committee constituted to recommend reforms to India’s Special Economic Zone (SEZ) policy is expected to submit its report to the Ministry of Commerce. The report, to be submitted to Commerce Secretary Shri Rajesh Agarwal, is expected to recommend measures to revamp the SEZ framework to boost domestic manufacturing, exports and import substitution.
The 17-member panel, constituted in March under the Commerce Secretary’s chairmanship, was given six months to prepare a comprehensive roadmap for the so-called SEZ 2.0 policy.
The committee has been examining the effectiveness of the Special Economic Zones Act, 2005, in the current global trade environment whilst identifying operational bottlenecks faced by developers and units.
Its mandate includes harmonising SEZs with other export promotion schemes such as Export Oriented Units, Manufacturing and Other Operations in Warehouse, and various duty exemption programmes to eliminate policy distortions.
The committee has held consultations with various stakeholders and examined issues relating to the functioning of SEZs, reported PTI.
A key focus has been the harmonisation of existing export promotion schemes, including Special Economic Zones (SEZs), Export-Oriented Units (EOUs), Manufacturing and Other Operations in Warehouse (MOOWR), Advance Authorisation, Export Promotion Capital Goods (EPCG) and the Duty-Free Import Authorisation (DFIA) scheme.
Policy And Legal Reforms Under Review
The panel’s terms of reference include identifying operational, procedural and regulatory challenges faced by SEZ developers and units, reviewing the fiscal impact of SEZs, including revenue forgone through tax and duty exemptions, and assessing their contribution to exports, investment and economic activity.
It has also been tasked with recommending short-, medium- and long-term policy, legal and procedural reforms, including possible amendments to the SEZ Act and Rules, along with an implementation roadmap.
Review Driven By Changing Trade Landscape
The review comes as India’s trade and manufacturing ecosystem has evolved significantly since the SEZ Act was enacted in 2005, requiring the policy framework to be aligned with current global trade dynamics.
According to official data, exports from SEZs increased 7.37 percent to USD 172.27 billion in 2024-25. India currently has 276 operational SEZs housing 6,279 units.Total exports from these zones have experienced fluctuations, declining to $133. 45 billion in fiscal year 2025-26 from $172. 07 billion the previous year, highlighting the urgency for structural changes that can revitalise manufacturing competitiveness and capacity utilisation.
The committee’s recommendations will include short-, medium- and long-term policy, legal and procedural reforms, with possible amendments to the SEZ Act and Rules.
The panel has drawn expertise from the Ministry of Commerce and Industry, NITI Aayog, the Central Board of Indirect Taxes and Customs, and various development commissioners to ensure the new framework aligns with World Trade Organisation norms whilst boosting exports, investment and employment generation.
