(b) Special Economic Zones may be developed and managed in the private sector or jointly by State Government and a private agency or exclusively by the State Government or their agencies. In the case of privately developed zones, the investors could be either Indian individuals, NRIs, Indian or foreign companies.

(c) New infrastructural development works such as construction of Standard Design Factory Building etc. may also be undertaken through private/joint/State sector in the Export Processing Zones converted into Special Economic Zones.

(i) Minimum size of the SEZ shall not be less than 1000 hectares. This would however, not apply to existing EPZs converting into SEZs as such or for notifying additional area as a part of such SEZ or to product specific SEZs.

(ii) The SEZ and units therein shall abide by local laws, rules, regulations or bye-laws in regard to area planning, sewerage disposal, pollution control and the like. They shall also comply with industrial and labour laws and such other laws/rules and regulations as may be locally applicable.

(iii) Such SEZ shall make adequate arrangements to fulfill all the requirements of the laws, rules and procedures applicable to such SEZ.

(iv) Only units approved under the SEZ Scheme would be permitted to be located in these SEZ. At least 25 % area of the SEZ shall be used for developing industrial area for setting up of such units.

(v) The predominant objective of development of a SEZ would be to create infrastructure which would facilitate setting up of industrial area for units therein as indicated in the para (iv) above.

(i) Location of the proposed zone with details of existing and proposed infrastructure,

(ii) Area of the proposed SEZ and its area distance from the nearest Sea Port/Airport/Rail/Road head etc.

(iii) Financial details including investment proposed, mode of financing the project and viability of the project.

(iv) Details of foreign equity and repatriation of dividends etc., if any.

(v) Whether the zone will allow only certain specific industries or will be a multi-product zone.

3.2 The State Government shall, forward it alongwith their commitment to the following, to the Department of Commerce, Government of India:

The area incorporated in the proposed Special Economic Zone is free from environmental prohibition ;

Water, Electricity and other services would be provided as required;

Full exemption in electricity duty and tax on sale of electricity for self generated and purchased power;
To allow generation, transmission and distribution of power within SEZ;
(vi) Exemption from State Sales Tax, octroi, mandi tax, turnover tax and taxes, duty, Cess, levies on supply of goods from Domestic Tariff Area to SEZ units;
(vii) For units inside the Zone, the powers under the Industrial Disputes Act and other related Acts would be delegated to the Development Commissioner.
(viii) The Zone will be declared as a Public Utility Service under Industrial Disputes Act.
(ix) Single point clearances system would be provided to the units in the Zone under State Laws/Rules.

3.3 The proposal incorporating the commitments of the State Government shall be considered by the Board of Approval (BOA) as notified vide notification No 14/1/2001-EPZ dated 7.8.2001.

3.4 On acceptance of the proposal by the BOA, the Department of Commerce will issue a Letter of Permission to the applicant ; hereafter referred to as “developer”.

3.5 Developer could undertake activities required for the development of the zone as per the approval granted by BOA. Other entities, as approved by the BOA, may also undertake approved development activities of the SEZ provided that commercial, residential and recreational facilities shall be approved only if the developer has at least 26% equity in such entities.

3.6 In case of converted EPZ into SEZ approval for development of requirements in infrastructure will have to be obtained from BOA on case to case basis. Para 3.5 shall mutates mutandis apply to creation of new infrastructure in the converted SEZs.

The Central Government may withdraw the approval given to an undertaking for setting up of SEZ if the undertaking fails to comply with any of the conditions of approval.