Most of the Indian states have issued their own local legislation on the Special Economic Zone. Structured closely on the already successful model of China, they are designed to help stimulate both foreign and domestic investment, boost India’s import – export, and create new employment opportunities. So India’s SEZs have become important sourcing and manufacturing destinations for foreign investors.
Some advantages of setting up a sourcing or manufacturing platform within an Indian SEZ , among the others, include:
- Duty free import and domestic procurement of goods for the development, operation, and maintenance of your company.
- 100 percent income tax exemption on export income for first five years, 50 percent for five years thereafter, and 50 percent of the export profit reinvested in the business for the next five years.
- Exemption from the Goods and Services Tax (GST) and levies imposed by state government.
- Permission to manufacture products directly, as long as the goods you are producing fall within a sector which allows 100 percent FDI.