In a significant step towards strengthening India’s export competitiveness and overhauling the trade promotion ecosystem, the Department of Commerce, Ministry of Commerce & Industry, has constituted a high-level inter-ministerial Committee for larger reforms in Special Economic Zones (SEZ) policy.
The Committee, constituted vide Office Memorandum No. K-43013(11)/1/2022-SEZ dated 26th February 2026, has been tasked with undertaking a comprehensive background study focussed on harmonisation of various prevalent export promotion schemes including SEZs, Export Oriented Units (EoUs), Manufacture and Other Operations in Warehouse Regulations (MOOWR), Advance Authorization (AA), Export Promotion Capital Goods (EPCG) scheme, and Duty Free Import Authorization (DFIA). The Committee will submit a concept paper recommending a roadmap for broad-based and comprehensive reforms to formulate an ambitious SEZ 2.0 Policy.
Composition of the Committee:
The Committee comprises senior officials from across key Ministries, Departments, and institutions, ensuring a whole-of-government approach to the reform exercise:
| S. No. | Member | Designation |
| i. | Additional Secretary (SEZ), Department of Commerce | Chairperson |
| ii. | Joint Secretary (SEZ), Department of Commerce | Member |
| iii. | Development Commissioner, SEEPZ | Member |
| iv. | Development Commissioner, MEPZ | Member |
| v. | DC (Customs), MEPZ | Member |
| vi. | DC (Customs), KASEZ | Member |
| vii. | DG, EPCES | Member |
| viii. | Representative from Chief Economic Adviser, Department of Economic Affairs | Member |
| ix. | Representative from NITI Aayog | Member |
| x. | Representative from DGFT | Member |
| xi. | Representative from DPIIT | Member |
| xii. | Representative from TRU, CBIC, DoR | Member |
| xiii. | Representative from Customs Policy Wing, CBIC, DoR | Member |
| xiv. | Representative from GST Policy Wing, CBIC, DoR | Member |
| xv. | Representative from DGEP, DoR | Member |
| xvi. | Representative from International Customs Division, CBIC, DoR | Member |
| xvii. | Director (SEZ), Department of Commerce | Member Secretary |
The Committee may also co-opt additional members as per requirement and may constitute sub-groups for effective discharge of its mandate.
Comprehensive Terms of Reference (TOR):
The Committee has been given a wide-ranging mandate covering the following areas:
- Review of Existing Framework: Examine the existing SEZ Act, 2005, assessing its effectiveness in the current global trade, investment environment, and macro-economic landscape, and harmonisation with other export promotion schemes such as EoUs, MOOWR, AA, and EPCG to address any policy distortions.
- Assessment of Recent Reforms: Evaluate the impact of recent and proposed reforms in SEZ policy, including measures relating to Domestic Tariff Area (DTA) sales, fiscal and non-fiscal incentives, compliance requirements, and operational flexibilities on exports, investment, employment, and ease of doing business.
- Export Competitiveness and Global Alignment: Analyse the alignment of SEZ policy with India’s export competitiveness objectives, international trade commitments (including WTO disciplines), and evolving global value chains.
- Investment and Employment Outcomes: Assess the effectiveness of SEZs in attracting domestic and foreign investment, promoting manufacturing and services, technology up-gradation, value addition, and employment generation, including for MSMEs.
- Operational and Procedural Bottlenecks: Identify operational, procedural, and regulatory challenges faced by SEZ developers and units, including issues relating to customs, taxation, approvals, compliance burden, infrastructure, and coordination among stakeholders.
- Fiscal Implications: Review the fiscal impact of SEZs and related reforms on revenue, including foregone duties and taxes, and assess the cost-benefit outcomes in terms of exports, investment, and economic activity.
- Role of SEZs in Atmanirbhar Bharat and Make in India: Evaluate the role of SEZs in advancing national initiatives such as Atmanirbhar Bharatand Make in India, including integration with industrial corridors, logistics networks, and catering to sunrise manufacturing sectorslike semiconductors, electronics components, green hydrogen, and manufacturing services in a comprehensive manner.
- International Best Practices: Study international best practices and comparable SEZ/free trade zone models and assess their relevance and adaptability to the Indian context.
- Stakeholder Consultation: Engage with key stakeholders including Central and State Governments, SEZ authorities, developers, units, industry associations, exporters, and other relevant entities to obtain inputs and suggestions.
- Recommendations and Roadmap: Recommend short-term, medium-term, and long-termpolicy, legal, and procedural reforms, including possible amendments to the SEZ Act/Rules, and suggest an implementation roadmap with clear timelines.
- Any Other Matter: Examine any other issue relevant to strengthening the SEZ framework and ensuring its continued relevance as an engine of exports, investment, and employment.
Timeline:
The Committee has been directed to submit its concept paper, roadmap, suggestions, and amendments along with recommendations within six months, or within such extended term as may be permitted.
Background:
Special Economic Zones have been a cornerstone of India’s export promotion strategy since the enactment of the SEZ Act, 2005. However, with the evolving global trade landscape, the emergence of new-age sectors, and the changing contours of India’s economic priorities under initiatives like Atmanirbhar Bharat and Make in India, there has been a growing need for a comprehensive review and harmonisation of the various export promotion schemes operating in parallel. The constitution of this Committee reflects the Government’s commitment to creating a unified, globally competitive, and future-ready trade and export promotion framework that will position India as a preferred investment and manufacturing destination.
The SEZ 2.0 Policy is expected to address existing policy distortions, reduce compliance burdens, align with international best practices, and provide a coherent and integrated incentive architecture that boosts India’s exports, attracts global investments, and generates large-scale employment.
The Office Memorandum can be accessed at: https://a2ztaxcorp.net/wp-content/uploads/2026/03/DoC-letter-dt.-26.02.2026.pdf
