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SEZ Board Allows GAIL to Exit Kochi SEZ

The Central government has allowed GAIL (India) to exit as a unit from the Cochin Port Trust Special Economic Zone (CSEZ) in Puthuvypeen, Ernakulam, in Kerala after repaying duty benefits it has availed so far. GAIL (India) had failed to meet the requirement of being a net foreign exchange earner (NFE).

 

The Cochin Port Trust, developer of the SEZ, and the three co-developers — Petronet LNG, Bharat Petroleum Corporation (BPCL) and Indian Oil Corporation (IOCL) have been given a year’s time to bring another unit into the zone that has a direct relationship with their activities, failing which the zone will lose its SEZ status. It is necessary for a new unit to come up after the exit of GAIL as it was the only operational unit in the SEZ. Without a functional unit, the zone will cease to exist.

 

The Puthuvypeen SEZ was notified as an SEZ in 2006 over an area of 285.84 ha. GAIL (India) was issued a letter of approval (LoA) in 2010 for the authorised operation of a regasified LG transmission and distribution unit.

 

The unit’s activities took off in 2013, making the SEZ operational. An investment of around Rs 10,000 crore had already been made in the zone with duty concessions.

 

The GAIL unit purchases LNG from co-developer Petronet LNG and supplies it to its customers, mostly located in the domestic tariff area (DTA), which lies outside the SEZ, after re-gasification.

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