China Vs India, SEZs Comparison and Review

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-> SEZ’s in China.

The Chinese started their liberalization and industrialization with the formation of SEZs in late 70s and early 80s. Unlike India, where SEZ is being incorporated 15 years after the start of liberalization process.China had a Master Plan and an economic framework on how to build and proceed with SEZs, most probably inspired by the success of Asian Trading Hub, Hong Kong. The Dragons started building massive cities for manufacturing and industrialization under their SEZ framework. Dragons also rolled out red carpet for foreign companies to build and operate from these SEZs. If you look at the Map on your left, China has only 5 SEZs, India has approved 200 and still counting. All the Chinese SEZs are located along the coast line. Indian SEZs are mostly concentrated near major cities and more than half are being developed by Real Estate Companies in order to make a quick buck by grabbing land at cheap prices under SEZ land acquisition act which is a scam in itself. KPMG India, Tax Head, Sudhir Kapadia said, “They(Chinese SEZs) are close to ports and trade nations like Hong Kong, Macau and Taiwan. A lot of thought has gone into the location of these SEZs. “Dragon SEZ blueprint says, Size Matters for SEZ. Shenzhen is the largest SEZ in China and is spread over 493 Sq Kms.(49,300 hectares). While the largest SEZ in India, Reliance – Navi Mumbai and Maha Mumbai SEZ, is mere 14,000 hectares. Exports from Shenzen SEZ reached $100 Billion in 2005. Total Chinese exports for 2005 was around $700 Billion which implies Shenzen contributed 15% of Chinese exports.Chinese SEZ initiative is government driven, Indian SEZs are driven by private sector.