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Poor response pushes Govt. to denotify part of APSEZ

Santosh Patnaik
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Hit by global market down fallout and bowing down to pressure from industrialists’ lobby, the Ministry of Commerce has de-notified 905.21 hectares at AP Special Economic Zone at Atchutapuram, leaving 1300.82 hectares for the multi-product SEZ.

Sources told The Hindu that lukewarm response from the investors as well as the enforcement of power holiday by the State Government and withdrawal of certain concessions led to pressure for de-notification.

The SEZ which has good connectivity, failed to achieve the projected export turnover of Rs.10,000 crore within five years of its operation due to recession and other factors.

In view of the prevailing ground realities the SEZ Board of Approval at its 54{+t}{+h}meeting directed the nodal agency APIIC to change the layout after de-notification and return duties and other benefits availed by the nodal agency since its notification under the SEZ Act for the de-notified part of the land.

“As export is a must for the units in the zone many wanted to invest outside,” APIIC Zonal Manager (Special Projects Zone) C. Yathi Raju said on Wednesday.

To a question, he admitted that due to power holiday, some units had to slash production.

SEZ policy

APSEZ was set up as per SEZ Policy of 2000 in areas falling in Atchutapuram and Rambilli mandals to attract investments by offering income tax holiday for five years and other benefits.

Major investors at APSEZ include Abhijit Ferrotech Ltd, Pokarna Engineered Stone Ltd, W.S. Industries Ltd, Confidence Petroleum (India) Ltd, Anjaneya Alloys Ltd and Kaizen Power Ltd.

Fifteen hundred acres allotted to HPCL at APSEZ was cancelled early this year following failure of the company to ground work on a Greenfield refinery proposed at a cost of Rs.45,000 crore.

Welcoming the de-notification, Vizag Zone Vice-Chairman of CII G. Sambasiva Rao wondered how investors would come if the government fails to provide power and other basic amenities.

He said the lease charge and annual rent was more than the prevailing rate of land outside the zone.


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