Kochi: The Cochin Special Economic Zone (CSEZ) at Kakkanad, a Kochi borough, is planning infrastructural development with private participation. This includes the construction of a software park at the cost of Rs 20 crore and a multistoried structure.

The software park will function like the technoparks in the state of Kerala, according to CSEZ development commissioner Paul Antony. “The software park will attract software exports to CSEZ. With private participation, 35 companies can function from the software park. CSEZ is now opened to trading companies; some gold exporting firms are planning to open offices at CSEZ.”

CSEZ is one of the three EPZs that were converted into SEZs in November 2000. The zone, run directly by the Government of India, has 6.87-lakh sq ft of built-up area. “The export from the zone was Rs 242 crore in 1999-2000. This year, it will go up to Rs 300 crore and exports have doubled over the last five years. The electronic hardware sector exports quadrupled over this period. And nine software units are now under implementation,” he said.

Antony says CSEZ offers exciting possibilities for the IT sector. “VSNL, Kochi, has the most modern international gateway in India. VSNL Kochi is less than one kilometre away from the zone and is operating a facility in the zone under the co-location scheme, offering global connectivity support to zone units at low entry costs and concession in recurring rates. An incubator for start-ups is being planned with state government funding. Two private ISPs have been licensed for operation in CSEZ. A new complex with 2.10 lakh sq ft of area aimed specially at the software sector is being planned in CSEZ with private sector participation. It is expected to be commissioned in late 2001.”

A special economic zone is an enclave, a deemed foreign territory within India, for the purpose of trade and customs duties, with special rules for facilitating foreign direct investment. Approvals for all investment proposals in the manufacturing sector in CSEZ, including fully foreign-owned investment, are given locally and positively within 15 days, provided the application is complete in all respects.

Payments of royalty up to 8 per cent on exports and 5 per cent on domestic sales are permitted under the automatic route. Foreign technology tie-ups with lumpsum payment not exceeding US$ 2 million, and royalty of up to 5 per cent on domestic sales and 8 per cent on exports are permitted under the automatic route.

Foreign equity can be brought in freely under the automatic route, without prior approvals. CSEZ units can import without duty capital goods and raw materials; no import license is required. These units can sell in the Indian market on payment of duties. These units are exempted from stamp duty, registration and property taxes. Also exempted from the income tax for 10 years up to 2010.