Update
The government continues to approve special economic zones (sezs) on a regular basis and the finance and commerce ministries continue to slug it out. The dispute between the two ministries over whether the government stands to lose revenue or gain through employment generation and increased economic activity continues.
The finance ministry's estimate on revenue loss through tax concessions has risen to over Rs 100,000 crore from 2006-07 through 2009-10. According to an estimate by the finance ministry, the current estimate has gone up by Rs 8,717 crore, the break up of the loss is estimated to be Rs 53,740 crore through direct tax concessions and Rs 48,881 crore through indirect tax concessions.
But the commerce ministry believes that the government will actually earn more revenue in the next five years. The commerce ministry also claims that increased economic activity and employment would more than just cover up for the losses in taxes. Total investment is approximated to be around US $10 billion and employment generation around 2.6 billion working days by the end of next year.
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