New Delhi, September 20 :

The government will soon issue fresh guidelines for the setting up of special economic zones (SEZs), even as applications for 225 such projects are pending clearances, special secretary (Commerce) G K Pillai said on Wednesday.

The guidelines will cover issues such as processing areas, infrastructure, norms for approval of the master plan as also the town planning guidelines, Pillai told a seminar organised by the Confederation of Indian Industry (CII) here.

The official also spoke about the controversy that has cropped up on account of the government’s SEZ policy announced last year, especially over the projected tax loss of Rs 900 billion ($20 billion) over the next few years because of tax breaks for such projects.

“Our ministry has analysed this and feels that the net benefit to the government from indirect tax will be Rs 450 billion,” he said.

“Tax rebates are needed for the development of infrastructure and attracting investments.” Pillai also brushed aside allegations that a large number of farmers have been displaced from their land because of SEZs, saying the 150 such special zones set up so far on 26,800 hectares had not encroached any farm land.