Govt mulls changing SEZ policy, may invite private sector
REPUBLICA
KATHMANDU, Nov 7: The government is mulling over opening the development and management of much-talked but not yet materialized special economic zones (SEZs) to the private sector by revising the SEZ policy and law.
So far, SEZ has been largely pushed as a state-developed entity, wherein the government would first develop the land, lay down basic services and then welcome the private sector to set up the industrial units and operations.
Also SEZ was largely taken as special industrial areas wherein only export-oriented industries will be allowed to be established and enjoy duty concession and other facilities.
“But, we have realized this approach needs change,” said Pratap Kumar Pathak, secretary at the Ministry of Industry. He stated that the ministry was now adopting three approaches for SEZs: i) development and management of SEZs by the state, ii) development and management under public-private model and iii) allowing the private sector to independently develop and manage SEZs.
The new changes is being worked out after the government´s commitment remained weak in materializing the concept of SEZ -- something which has been pushed since past one decade for the industrialization and exports development, but has failed to overcome hurdles from rigid labor laws.
Under the new concept, officials said the government will categorize SEZs into product-specific, sector specific and area specific for creating a favorable industrial climate. “Under the sector specific approach, we can declare whole of Pokhara as SEZ for tourism industry,” said Pathak, elaborating on the issue.
Likewise, garment processing zone that the government is developing in Simara would be an example of sector-specific SEZ, while Morang-Sunsari corridor could be declared as an area specific SEZ.
“We can declare the whole area from Dang to Surkhet as SEZ for cement industry, giving the limestone reserve the area has to a number of cement industries that are willing to operate there,” said Pathak, adding that the facilities for all types of SEZs will remain the same, so that entrepreneurs could be encouraged to develop SEZs themselves.
Despite the initiation of new exercises on SEZ, officials concerned did not elaborate much on how they plan to overcome labor related issues that have stood as major impediments to endorsing SEZ law and implementing the SEZ that the government has readied in places like Bhairahawa.
“We are incorporating a new provision of ´no work, no pay´ in the new industrial policy. Also, there are provisions of higher salary, insurance and other provisions. We have also provisioned a concept of addressing workers´ concerns through a tripartite body in the SEZ. I think, these will create a strong base to legalize SEZs as strike-free zones,” said an official at SEZ Project.
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Govt Mulls Changing SEZ Policy, May Invite Private Sector
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