India Relaxes SEZ Rules to Boost High-Tech Manufacturing

On 10th June 2025, the central government announced key policy relaxations for Special Economic Zones (SEZs) to accelerate high-tech manufacturing, especially in semiconductors and electronic components.

Key Points

Land Requirement Reduced: Rule 5 of the SEZ Rules, 2006 has been amended to reduce the minimum contiguous land required for semiconductor/electronic component SEZs from 50 hectares to 10 hectares.
Encumbrance Norms Eased: Under Rule 7, SEZ land mortgaged or leased to central/state governments or authorised agencies is now eligible for relaxation from encumbrance-free norms.
Domestic Sales Permitted: Rule 18 now permits SEZ units in these sectors to sell goods in the domestic tariff area after paying applicable duties.
Updated NFE Calculation: Rule 53 has been revised to include goods received and supplied free of cost in Net Foreign Exchange (NFE) calculations, using customs valuation norms.
Attracting Investment: These changes aim to simplify regulations, attract advanced tech investments, and integrate India more deeply into the global semiconductor supply chain.