Visakhapatnam Special Economic Zone
Visakhapatnam Special Economic Zone (VSEZ), also called the Andhra Pradesh First Economic Zone, is one of the central government special economic zones in India. VSEZ is located in Duvvada, 20 km away from the Visakhapatnam.[2]
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| Type | Special economic zone |
|---|---|
| Founded | 1989 |
| Headquarters | , |
| Products | Multi-product (Electronic goods, software, pharmaceuticals etc.)[1] |
| Owner | Government of India |
| Website | |
'Back Ground to Special Economic Zones of India' Govt. of India with a view to attract investment, promote exports, generate large scale employment and economic activity has formulated the SEZ Policy. After the enactment of the SEZ policy, in the year 2005 by Govt. of India, major multinational companies, a number of State Governments, and large-scale domestic players have come forward for setting up of SEZs in the Country.
SEZs are basically-
- A designated duty-free enclaves
- No license required for import of Capital Goods or Raw Materials
- Manufacturing, trading & Service activities allowed
- 100% FDI allowed under automatic route (except prohibited sectors)
- The only criteria is SEZ units have to be a positive net foreign exchange earner
SEZ – Minimum Area requirements
Multi Product : 500 hectares
Sector specific : 50 hectares
Free Trade & Warehousing : 40 hectares
Food & Agri based Product SEZs : 10 hectares
Bio Tech or Health Services : No minimum land requirement other than Hospital)
Min. built-up processing area requirement for setting up is as given below IT/ITES : No minimum requirement of Land prescribed.
Minimum Built-up space norms (City Wise) : Cat-A : 50,000 Sq. Mts. : Cat-B : 25,000 Sq. Mts : Cat-C : 15,000 Sq. Mts.
The minimum processing area in any Special Economic Zone can't be less than 50% of total area of the SEZ. All existing notified SEZs are deemed to be a multi-sector SEZ
History of VEPZ (Presently Visakhapatnam Special Economic Zone)
The zone originated in 1989, and is the last one to be set up in the country, after the country's first SEZ was set up in Kandla in 1965, when it was named as VEPZ (Visakhpatnam Export Processing Zone). It was changed to the Visakapatnam Special Economic Zone on 1 January 2003. The zone consists of an area of 360.5 acres. The Development Commissioner, the administrative head of the zone, is also the head of all 60 special economic zones in Andhra Pradesh, Telangana, Chhattisgarh and the union territory of Yanam. There are not many SEZs set up in the State of Chhattisgarh and Yanam.
The Development of the Zone was taken up in a Phased manner with a current total investment in the Zone to the tune of Rs 1626 Cr. The zone offers state of the art infrastructure facilities with well-developed plots and ready-built up spaces to cater to all the Industrial requirements. The details of the infrastructure facilities available in the zone that are offered to the entrepreneurs is furnished here under: A. Well-developed Plots: The entrepreneurs who are interested in setting up of units in VSEZ, to construct a factory on their own were offered well developed plots by VSEZ Authority. VSEZ Authority has developed plots for allotment to the entrepreneurs, these plots range in size from 0.5 acres and above up to 5 acres in compact patches, and can be offered as a compact batch for allotment. The plots are well connected with excellent road network both main roads, service roads and arterial roads. The vacant developed plots are allotted to the entrepreneurs on lease basis at a very competitive price. Initially the land is allotted for a period of five years which is co-terminus with the Letter of Approval (LoA) and renewable for a further period if the conditions of LoA are met with from time to time. The Units set up in VSEZ are exempted from payment of registration charges or stamp duties for registration of lease deed.
B. Built-up Spaces:
The VSEZ Authority has developed different built-up spaces to cater to the requirement of all types of sectors viz. small, medium and major entrepreneurs:
i. Standard Design Factory Buildings: The Zone has developed 4 Multi storied Standard Design Factory (SDF) Buildings with all amenities in the buildings. These SDFs consists of a total area of 75,469 Sqm for allotment to the entrepreneurs. All the floors of the SDFs are provided with power and water facilities. All the common area of the SDFs are well ventilated and provided with lighting and safety exits. All the SDFs are provided with Passenger Lifts and Heavy-Duty Cargo lifts to facilitate movement of cargo to all the floors of the SDFs. To facilitate easy movement and movement of forklifts the floors are connected with Ramps. In order to cater to the requirement of all types of industries the ceilings are having clear standard heights, load bearing capacity to withstand the installation of heavy machinery and its vibrations. The SDFs are provided with ample parking facilities and open spaces surrounding the buildings for easy movement of heavy vehicles and for shifting of machinery or cargo. Each unit set up in the SDF building are allotted ample parking spaces both for four wheelers and two-wheeler parking. Each SDF Building is equipped with power back up facility. The zone has invested a total amount of Rs. 27.35 crores in construction of the SDF Buildings. The built-up space is allotted on lease basis initially for a period of five years and extendable thereafter. The units are exempted from payment of registration fee/stamp duty on registration of the built-up space allotted to them.
ii. Industrial Sheds/Warehouses: The Zone has developed 12 Nos of Industrial Sheds with all amenities in the buildings. These industrial sheds consist of a total area of 12000 Sqm. each Industrial shed consists of 1000 Sq. Mts of built up area andone acre of vacant land surrounding the built-up area for movement of heavy vehicles. The Industrial sheds are built with a view to cater to the requirement of specific industries having heavy machinery and the roofingwhich are havingclear height for installation of heavy and vertical movement of machinery and EOT cranes etc. The Industrial sheds are well ventilated and provided with all amenities viz Power, Water etc., Each Industrial shed is enclosed with a separate compound wall of standard height. The Industrial sheds are constructed in such a way that a heavy vehicle can directly enter into the Industrial sheds for loading and unloading of material. The flooring of the Industrial sheds is of Heavy-duty flooring to with stand the heavy load of the machinery and its vibrations. The zone has invested a total amount of Rs. 8.60 crores for the construction of the Industrial sheds, there is huge demand for the Industrial sheds and at all times the Industrial sheds are full. The Industrial sheds are allotted on lease basis initially for a period of five years and extendable thereafter.
iii. Trading Sheds: In order to cater to the requirements of small, medium and MSME and trading requirements, the Zone has developed 18 No Trading Sheds with all amenities in the buildings. These Trading sheds consists of a total area of 1800 Sqm. each Industrial shed consists of 100 Sq. Mts of built up area and minimum vacant space surrounding the built-up area for movement of heavy vehicles. The Trading sheds (about 1000 sq.ft) are built with a view to cater to the requirement of small, medium and MSME industries having light and minimum machinery and to encourage the MSMEs with easy access to the sheds.The Trading sheds are well ventilated and provided with all amenities viz Power, Water etc., The trading sheds are constructed in a separate area of the zone to facilitate smooth functioning of the units without any disturbance. The zone has invested a total amount of Rs. 0.49 crores in construction of the Trading sheds, there is huge demand for the Trading sheds and at all times the Trading sheds are full. The Trading sheds are allotted on lease basis initially for a period of five years and extendable thereafter.
iv. Power Infrastructure: VSEZ Authority has allotted 5 acres of vacant land to APEPDCL, Govt. of Andhra Pradesh for erection of a sub-station in VSEZ. APEPDCL has erected a 132/33 KVA Sub-station in the VSEZ premises to cater to the power requirement of the units in the VSEZ. The load requirements i.e., HT power or LT power requirement is very well augmented by the power sub-station. The units in the VSEZ are assured of reliable power supply round the clock, the power failures are very minimal. The Zone has provided the power infrastructure to the doorstep of the unit i.e., laying of power cables, erection of electricity poles, street lighting, erection of towers, transformers etc. The units have to apply to the APEPDCL for power connection and the power consumption charges are directly paid to the APEPDC Limited.
v. Water Supply System: VSEZ Authority has created a very modern water pumping system to supply water to all the units in the zone at a very competitive price. The treated water is drawn from Greater Visakhapatnam Municipal Corporation and pumped with heavy duty motors to the Over Head Tanks. As the zone has been developed in three phases as Phase-I, Phase-II and Phase-III, the pump houses are constructed at important points to pump the water to designated OHTs for supply to the units.The water is supplied through the Pump Houses and gravity. The water network and supply system is so robust that there is no line losses or leakage or pilferage of water at any given point of time. The pipelines are laid upto the door step of the unit, the unit set up in vacant land have to lay the internal piping. All the units are provided Water Meters and the consumption charges are collected as per the consumption with transparency and accuracy. A dedicated water supply maintenance team is available round the clock for operating the motors and to attend any maintenance call.
vi. Solar Power: The VSEZ Authority has made alternative arrangements to meet the power requirements of the zone. In that direction the zone has set up a total of 0.85 MW solar power plant to meet the power requirements of the zone in order to promote green energy and to make VSEZ a Green SEZ. There is a dedicated open area for the Solar Power Plant and also with Panels fixed on the rooftops of SDFs and Admin Building. The Solar power is linked to the grid and the power consumed is adjusted based on the net metering of the power drawn from APEPDC Limited. A dedicated Electrical team is in place to attend any type of problems to rectify the same.
vii. Electronic Weigh Bridge: To facilitate the units set up in the zone for easy clearances at the time of import and export of consignments an advanced tech. electronic weigh bridge 80 MT of electronic weigh bridge was constructed. The facility was provided within the premises of the zone to ensure speedy clearances of the consignments of the unit and to save valuable time of the units. The facility is run through contractor and the zone ensures transparency and accuracy at all times. Availability of Electronic weigh bridge at the door step of the zone is one of the advantages the zone offers to the entrepreneurs. The zone has invested an amount of Rs. 12.79 Lakhs for creation of the facility and charges very minimal from the entrepreneurs.
viii. Heavy Vehicle Parking Bay : Keeping in view the movement of heavy vehicular traffic in the zone and the traffic congestion caused by these heavy vehicles, trailers etc., the zone has constructed a heavy vehicular parking bay in the non-processing area of the zone to facilitate all the vehicles coming to the zone to park the vehicles in the parking bay till the consignments are cleared by the Customs. This has avoided the traffic congestion in the processing area and avoided accidents also. The Heavy Vehicular Parking was constructed in an area of One acre with water and power facility and also provided a spacious room for Drivers temporary rest room with all facilities. The zone has invested an amount of 87.04 Lakhs for construction of the heavy vehicular parking. The Parking bay is maintained through a private contractor and the parking fee charged is very minimal.
ix. Dining Hall-cum-Creche: As per the provisions of the SEZ Act and Rules and as per the allotment guidelines, the space allotted to the units are to be exclusively used for export production purpose. Keeping in view the demand for built-up spaces in the zone and the requests of the units very limited areas are allotted and the same is utilized for production purpose only by the units. As per the statutory conditions the units have to set up dining facility and creche in the unit depending on the number of employees especially the women employees. Since the allotted spaces are very limited, in order to address the issue, the zone has provided a common dining hall cum creche to the units which has set up their units in the built-up spaces. All the required infrastructure is provided in the common dining hall cum creche. The required power, water and other amenities were provided in the Common Dining Hall cum Creche. The facility is well received and being utilized to the fullest especially by the IT Companies.
x. Incinerator for Waste Disposal: The Incinerator is the latest addition to the existing infrastructure facilities in the zone. In order to streamline the disposal of combustible waste/garbage generated by the units, which was not scientifically managed is removed manually through some trucks and dump the same in a deserted location which has resulted in spillage, creating foul smell etc., the Incinerator facility has been created. The incinerator will handle all types of waste/garbage generated by the units and the canteen. The facility is created at an identified location, the waste and garbage is moved internally from collecting the same from all the units and cleared at the incinerator. The facility is created in an area of 20 Sq.Mtrs. with an investment of Rs. 15 lakhs. The facility is handled by a contractor and the units are charged very minimal for disposal of the waste generated by the unit.
xi. Executive Canteen/Industrial Canteen: In order to cater to the food/beverages requirement of the units in the Zone at subsidized prices, the zone has constructed an exclusive Executive Canteen and industrial canteen in the zone premises. The facility is created in an area of 1.5 acres with sprawling lawn and garden in the front, with an investment of approximately Rs 45.00 lakhs. All the required infrastructure facilities have been provided in the canteens. All the kitchen equipment is provided. The canteen is properly ventilated. The canteen is run through a contractor and the charges are collected at a very nominal price on competitive bidding.
xii. CCTV Camera Surveillance System: Keeping in view the security threats to the Govt. installations and to create the state of the art Security infrastructure facilities and to monitor the movement of vehicles/men a highly sophisticated and technically advanced Wireless, CCTV Camera Surveillance Systems are set up at 11 strategic locations in the zone, with monitoring facility to all the senior officers of the VSEZ including DC. The cameras are placed at all the entry/exit points and at some important and vulnerable points to track the movement of vehicular and man power. The surveillance system closely monitors the entire operations of the units. The CCTV surveillance system is web enabled and available on mobiles also to monitor and track the movement. The Zone has invested app. an amount of Rs. 20 lakhs for creation of the facility.
xiii. Network Management Centre: To attract a greater number of Software units in the Zone, the Government has initiated steps for setting up of Network Management Centre in the zone. After the approval of the Government, VSEZ in association with STPI, MoIT has set up a Network Management Facility in the zone to cater to the internet requirements of the software units. The STPI is providing the required Internet to the units in the zone. The network is very reliable and services extended round the clock. Besides these, there are other Service Providers who are extending the internet connection to the units in the zone and to the VSEZ with uninterrupted and reliable connectivity with faster internet bandwidth.
xiv. SEZ online System: To minimize the human interface and to create a hassle-free environment across all the zones, Govt. in association with NSDL has developed an online system called the SEZ Online system. All the customs transactions in the SEZ are to be carried out through SEZ Online System which will facilitate operations of the unit to ensure ease of doing business. All the consignments are approved digitally based on the self-certification. The implementation of SEZ Online System in the year 2009-2010 has received a great response and applause by the trade. Now, the system is 100% operational and regularly upgrading and enhancing the features for smooth operations of the trade.
xv. Parks/Greenery in the Zone: VSEZ is a green zone with less carbon foot prints. Very high importance is given for development and maintenance of the greenery in the zone. The green cover in the zone is quite perceptible. A dedicated horticulture team takes care of the greenery and maintenance of greenery in the zone.The plantation is taken up in the entire zone on each occasion. As part of the development of avenue plantation and greenery in the zone, number of Parks have been developed namely Sandal wood garden, Chandan Park and Plumeria Garden etc., These parks were developed in odd bit vacant spaces which are not fit for allotment. A good no of saplings were planted on each/every occasion such. The plantation/greenery is maintained through a contractor having good experience in the field.
External Infrastructure:
i. Banks : Two nationalized banks namely State Bank of India and Union Bank of India are operating with their branches in the VSEZ Premises with their ATM (SBI) to facilitate the units carry their banking transactions and facilitate the common men visiting the zone. The space for the Banks was allotted to the Banks in the Ground Floor, in VSEZ Admin Bldg. on public utility services basis and charged nominal rent. The State Bank of India has been authorized to collect the duties paid by the unit. The Bank Provides services to the general public in the surrounding areas in addition to the services rendered to the zone units.
ii. Post Office: At the request of the VSEZ, the Postal Department has set up the Post Office to cater to the needs of the units. The space for setting up of the Post office is allotted on rent free accommodation in one of the shops available at VSEZ Admin Bldg. on public utility basis. The Post Office provides excellent services to the units in the zone and to the general public in the surrounding areas of the zone.
iii. Clearing and Forwarding Agents: To cater to the needs of the units and to facilitate them in the documentation and faster clearance, permission has been granted to set up the facility outside the zone premises as per the terms and conditions agreed upon. Two C & F agents are presently operation in the zone. The space for operation of C & Fs have been allotted in one of the shops on lease basis for providing the services.
Various Modes of Connectivity available with VSEZ:
i. Airport: The zone is very near to the Airport at 12 km distance and very well connected by Air. ii. Roads: The Zone is very near to the National High way at Just 2 Km distance and is well connected to the Road Transport. iii. Seaport: Seaport is also very near to the zone and all the consignments are cleared through Sea port.
Visakhapatnam Special Economic Zone (VSEZ) Achievements
SEZs have brought a revolution in the country's exports and have contributed a major share to the country's exports since its enactment in 2005, the year on year growth speaks of its exemplary performance. Where the world's economies faced regression, the SEZs of the country recorded a growth in exports of 12.24% during 2019-20. Govt. of India has granted 423 Formal Approvals so far and out of that 357 have been notified, which includes 7 Central Govt. SEZs, 12 State Govt. SEZs, and rest are in private domain. Nearly 253 SEZs with 5258 units have become operational as on date out of which 25 are Multiproduct SEZs. The notified SEZs have attracted investment of Rs.5.38 lakh cr. and provided employment to 22.33 lakh personnel directly, and contributed exports to the tune of Rs. 7.87 lakh crores during 2019-2020.
Exports from SEZs of the country increased constantly from 2016 to 2019, i.e. from Rs 5.23 lakh Cr to Rs 7.87 lakh Cr, which is a whopping 50% growth in just 4 years.
2016-17 : Rs. 5,23,637 Cr. 2019-20 : Rs. 7,86,761 Cr
So far, 96 SEZs have been formally approved in VSEZ and out of which, 85 SEZs have been notified by Government, and 60 SEZs are fully operational with 510 units and the Zone has achieved exports to the tune of Rs. 96886 Cr (12.3% of Nations exports from SEZs i.e. 7.87 lakh Crores) during 2019-20, compared to 74743 crores during 2018-19 and achieved an export growth of 32.79% which is the highest among all the 7 zones of the country. During 2019-20, an investment of Rs 56180 Cr has been made, and Employment of 383280 generated as on date.
During 2020-21 i.e. even during lockdown, as on 21.07.2020 the exports are 25972 Cr. We have recorded an increase in the exports of 16.86% in the first quarter
• Merchandise Rs. 7372 Cr Increase: 16.46%
• Services Rs. 10895 Cr Increase: 17.13%
• Total Rs. 18266 Cr Increase: 16.86% (Average)
Sector Wise Contribution to Exports in VSEZ
Computer/ Electronic software 72 Chemicals & Pharmaceuticals (Crude Petroleum Refinery) 15 Misc. 11 Engineering 2
Exports from SEZs of the country increased constantly from 2016 to 2019 i.e. from Rs 5.23 lakh Cr to Rs 7.87 lakh Cr, which is a whopping 50% growth in just 4 years.
References
- Guido Nassimbeni, Marco Sartor (2008). Sourcing in India. Springer. p. 65. ISBN 978-0230594166.
- "List of pharma companies in VSEZ". Pharmaclub.
- Santosh Patnaik. "VSEZ acquiring land for expansion". www.thehindu.com.
- Arpita Mukherjee; et al. (2016). Special Economic Zones in India: Status, Issues and Potential. Springer. p. 89. ISBN 978-8132228066.
