SEZs into cyber city: Feedback on controversial policy sought

Land use proposed to be tweaked for cyber city to increase residential and commercial component

CHANDIGARH: Haryana’s controversial proposal to grant licences for setting up of cyber city and cyber parks on the land chunks set apart for special economic zones (SEZs) has been put in public domain for suggestions from the stakeholders.

The proposal of enabling the conversion of de-notified SEZs to cyber city or parks was shelved by the council of ministers on July 29 following objections from two senior ministers.

Hindustan Times had on July 28 reported as to how the town and country planning department was pushing the controversial proposal at a time when the Central government was planning to enact a legislation by bringing Development of Enterprise and Service Hubs Bill in the Parliament to reform and refashion the fading SEZs in the country. The Bill is expected to be tabled in the winter session of the Parliament.

Union finance minister Nirmala Sitharaman had in the 2022-23 budget said that the SEZ Act will be replaced with a new legislation that will enable the states to become partners in the development of enterprise and service hubs.

Sitharaman had also said that this would cover all large existing and new industrial enclaves to optimally utilise available infrastructure and enhance competitiveness of exports. Thus, the timing of the state’s cabinet memorandum to push for conversion of de-notified SEZs to cyber city and parks had raised questions.

Windfall for developers who bought the SEZ land

There are 22 notified SEZs in Haryana and only seven are operational. “If implemented, the proposed policy would bring a windfall for real estate developers who have purchased the land of failed SEZs,” said a realty sector expert who did not wish to be named.

Realty sector experts say that if a SEZ gets de-notified, the land chunk will inevitably become agriculture in nature. Converting it into a cyber city or park will require amending the Punjab Scheduled Roads and Controlled Areas Restriction of Unregulated Development Act and the Haryana Development and Regulation of Urban Areas Act, they said.

“Also, what happens to tax exemptions given to SEZs. As per Haryana SEZ Act, all transactions and transfers of immovable property or documents related thereto within the SEZ are exempted from stamp duty,’’ said an expert.

IT component reduced; residential, commercial increased

As per the draft policy, a maximum of 45% of the licensed area with a floor area ratio (FAR) of 225 is allowed for residential group housing, 5 to 10% of the licensed area with FAR of 175 is allowed for commercial use and a minimum 50% of licensed area with FAR of 250 for setting up information technology component in a Cyber City.

Thus, the permissible use of the area for the information technology component in a cyber city is now proposed to be reduced to 50% from a minimum 66% approved in July 2020 by the cabinet.

On the other hand, the residential component is proposed to be increased to 45% from a maximum 25% and commercial component increased to 5 to 10% from 4 to 8%. The draft policy also proposes to reduce the minimum area norm for establishment of cyber city from a minimum 50 acres to above 24 acres which may also be relaxed up to 10%. For cyber parks, which as per draft policy will be allowed on 5-24 acres instead of earlier 5-50 acre, a maximum 10% of the licensed area with FAR of 225 will be allowed for residential group housing and a maximum of 4% of the licensed area with FAR of 175 will be allowed for commercial use. A minimum 86% of the licensed area with FAR of 250 is allowed for IT units or usage.

IF IMPLEMENTED, THE PROPOSED POLICY WOULD BRING A WINDFALL FOR REAL ESTATE DEVELOPERS WHO HAVE PURCHASED THE LAND OF FAILED SEZS, SAYS AN EXPERT

Feedback being sought as per cabinet decision

Top officials said that while shelving the proposal, the Haryana council of ministers had decided to put the draft policy in public domain for feedback from the public and stakeholders, including the Union Commerce Ministry and Haryana Industries and Commerce department since SEZs are a subject of industries department and any decision pertaining to these cannot be taken without consultation with them. “Seeking feedback from stakeholders is in conformity with the decision of council of ministers. Nothing unusual about it,’’ said an official. “The policy shall come into effect only after considering all such suggestions received on the draft of policy and after undertaking necessary amendments in the statute,’’ reads the public notice issued by the Town and Country Planning department. As per the draft policy, de-notified SEZs situated in any land use zone of the published development plan, except in the residential zone, shall also be eligible for licence of cyber city or park as per the area and approach norms specified in this policy.