New clarification for goods procured from SEZs

New clarification for goods procured from SEZs
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Goods procured from units in special economic zones (SEZs) by single brand retailers, owned by foreign companies, would qualify for meeting the mandatory 30 per cent local sourcing conditions, according to a government clarification.

New Delhi: Goods procured from units in special economic zones (SEZs) by single brand retailers, owned by foreign companies, would qualify for meeting the mandatory 30 per cent local sourcing conditions, according to a government clarification.

According to the current foreign direct investment (FDI) policy on single brand retail trading, 100 per cent overseas investments are allowed in the sector. But sourcing of 30 per cent of the value of goods procured is mandatory from India for such companies having FDI beyond 51 per cent.

The government has received representations from various business entities seeking clarification whether sourcing of goods from units located in SEZs would qualify as sourcing from India, as per FDI policy.

However, the govt said that goods which are proposed to be sourced by a single brand retailer from SEZ units will have to be manufactured in India.

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