RAS question
Under Rule 7 amendment, what relaxation has been provided for SEZ land?
Correct answer: (B) Encumbrance-free condition relaxed for govt-leased land.
Under the Rule 7 amendment to the SEZ Rules, the Board of Approval may relax the encumbrance-free land condition when SEZ land is mortgaged or leased to the Central or State Government, or their authorised agencies.
Explanation
The Rule 7 amendment is about the encumbrance status of SEZ land, not a general exemption from regulation or tax. The existing rule required SEZ land to be encumbrance-free; the PIB release says the amendment allows the Board of Approval for SEZs to relax that condition where the land is mortgaged or leased to the Central Government, a State Government, or their authorised agencies. This matters because the wider SEZ reforms were aimed at easing practical constraints for semiconductor and electronics component manufacturing SEZs, where projects are capital intensive and have longer gestation periods. Therefore, option B is correct: the relaxation is specifically for government-linked mortgaged or leased land, and it operates through the Board of Approval.
Why the other options are wrong
- (A) The cited reform concerns the encumbrance-free condition for SEZ land, not removal of environmental clearance requirements.
- (C) The PIB release does not provide free land allocation to SEZ units; it only allows relaxation where land is mortgaged or leased to government entities or authorised agencies.
- (D) The amendment does not waive tax on land purchase; the stated change is limited to the encumbrance-free land condition under Rule 7.
Concept
This tests SEZ policy and industrial-infrastructure regulation, especially how land norms are adjusted to attract high-technology manufacturing. RAS often revisits such rule-based reforms because they connect current economic policy with investment facilitation.