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India Roundtable

QUESTION: Are Special Economic Zones a good way to stimulate economic growth in India, or do they result in land speculation, overgenerous tax incentives and an un-level playing field?

Nandan M. Nilekani
Nandan M. Nilekani
Co-Chairman of the Board of Directors, Infosys
SEZs can be useful for stimulating development of certain industries or regions of the country. However, like any other economic tool, they can lead to undesirable consequences if applied improperly. To avoid unintended consequences, the SEZ approval criteria should include land-use considerations and avoid involving real-estate developers who might be interested in land speculation. In addition, the SEZ approval process should be streamlined and simplified along the lines of STPI to enable smaller companies to benefit from SEZs.

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