It is clear that the government is putting high importance to Special Economic Zones (SEZs). Although this apparently looks like downplaying the Export Processing zones (EPZs), the reality remains that in the present-day world it is the SEZs that are gaining more and more prominence. And quite justifiably indeed. An official announcement some time ago said that the government was not considering approving any new EPZs. Instead, it would focus on establishing SEZs. The reason for preferring the SEZs may well be attributed to the fact that although the method of operation in the EPZs and SEZs are more or less the same, the scope of the SEZs is far wider, in that these are not confined to manufacturing for exports only like the EPZs. The benefits of SEZ are believed to be more towards job creation and growth of domestic business, whereas EPZs are solely export-centric. To this effect, the government has been contemplating for sometime to generously expand the base of the SEZs across the country. Decision has already been taken to set up 17 economic zones including a couple of dedicated zones for foreign investors as well as another three zones to be run by domestic entrepreneurs. The approved economic zones are mostly in the vicinity of the greater Dhaka, Chittagong and Barisal districts. Those earmarked exclusively for the foreigners — Chinese and Japanese — are at Anwara and Sripur respectably. The government is reportedly in the process of setting up some 100 economic zones in the country over the next 15 years, with the target of creating jobs for approximately ten million people, along with a projected export earning of $40 billion from these zones a year. Setting up of SEZs should not be questioned given the benefits they are known to generate in many countries from a range of economic activities. However, one may tend to be critical as regards plans that are too ambitious and may also be too difficult to sustain. It need not be mentioned that it is the basic utilities and infrastructure that are integral to making SEZs viable. The emphasis on economic zones has received attention in many countries. In our region, India is a pioneer in setting up SEZs with adequate facilities and from the successes of the zones in export growth, has gainfully been deriving increased sourcing of local materials and a boost to job creation. SEZs in India initially functioned under the provisions of the country’s foreign trade policy, and fiscal incentives were made effective through the provisions of relevant statutes. Subsequently, Special Economic Zones Act-2005 was passed by Parliament in 2005 and rules governing operation of the SEZs were also framed. In Bangladesh, although the Economic Zones Authority (BEZA) has been in place since 2010 to facilitate setting up of such zones, it has taken more time than expected to come up with a draft plan with identified locations. A study to explore setting up of economic zones under public private partnership (PPP) in phases was funded by the World Bank and UK’s Department for International Development (DFID). Earlier, the government reportedly gave Tk 470 million to the Bangladesh Economic Zones Authority (BEZA) as interest-free loan to acquire land and develop site for economic zones. As is the practice elsewhere, the government may launch international tenders to select developers and operators willing to invest in the economic zones. Investment on the part of the government would primarily be on land acquisition, and the cost would be eventually realised from investors through long-term leasing out, with provisions for renewal. It need not be stressed that the idea of making SEZs an engine for economic growth is integrally linked to quality infrastructure complemented by an attractive fiscal package, with minimum possible regulations. Besides, one key requirement is the operational rules which, understandably, should be in conformity with those in other countries. It is here that the role of the BEZA will be extremely important in putting things in place to start with, and then working on those steadfastly. Sustaining the economic zones will of course involve continued government support, besides providing essential services. In order that bureaucratic tangles do not deter proper functioning, BEZ should be adequately empowered to handle issues that may not be unique in our case as the whole thing comes in a package, in a more or less uniform pattern in most countries.
