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India
currently has four Special Economic Zones (SEZ), one of them
at Cochin. While the hardware business has been the prime
beneficiary of these zones, the SEZ at Cochin is in the process
of establishing itself as the destination of choice for software
companies as well. Says Paul Antony, development commissioner,
Cochin SEZ, “We have freed up procedures and created
an environment in which units can work efficiently with minimum
hassles. The emphasis is now on self-clearance and self-declaration
by the units with regards to customs procedures. This will
do away with old irritants.” As part of this drive to
promote the software business, the development commissioner
of the zone has been given powers to approve investment proposals
even those involving 100 percent Foreign Direct Investment
(FDI). He has also invested with the power to authenticate
SOFTEX forms in an effort to establish the SEZ as a one-stop
shop.
 Working
from the SEZ brings with it a host of advantages. To begin
with there is the Corporate Income Tax exemption till 2010.
Then there is the fact that export proceeds need to be brought
to India within 12 months of export and not six months as
it is in other places coupled with the element that these
can be all be held in foreign exchange in the EEFC account.
This facility guards receipts against depreciation and makes
foreign currency borrowings exchange risk-free. Says Antony,
“Given that foreign currency borrowings usually carry
a lower rate of interest, such a course of action becomes
all the more attractive.” Even as these advantages would
serve as sufficient bait to attract software companies to
the Cochin SEZ, the body has gone one step further and has
created a statutorily empowered Single Window Clearance Board
which gives all clearances associated with State Government
agencies in a time-bound manner.
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