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Mundra Solar's request for an acceptance extension was deferred at the SEZ Board meeting, but Wockhardt's was authorised.

 Mundra Solar's request for an acceptance extension was deferred at the SEZ Board meeting, but Wockhardt's was authorised.


After the zone's DC submits a comprehensive report, the BoA will reconsider the Adani Ports SEZ unit's appeal.


Mundra Solar, an SEZ unit that manufactures solar cells and modules in Adani Ports and SEZ (APSEZ) at Mundra, Gujarat, has had its request for an extension of approval deferred by the Board of Approval for SEZs, which has asked the zone's Development Commissioner (DC) to prepare a detailed report based on Revenue Department observations.


According to the minutes of the BoA meeting held on March 18, pharmaceutical giant Wockhardt obtained a one-year extension of approval for its unit at Wockhardt Infrastructure Growth SEZ in Aurangabad, which it had demanded.


“Wockhardt's approval was simple because it had already invested money in the project and was just waiting for regulatory approval,” a person familiar with the situation told BusinessLine.


Mundra Solar, for example, has obtained four extensions of approval in the past, but it has not started any physical building work on the land aside from receiving environmental clearance, according to the DC of APSEZ's application for the meeting's agenda.


The agenda for the meeting read, "It is pertinent to notice that the unit had applied for exit from SEZ via letter dated October 16, 2019, and subsequently withdrawn their application for exit from SEZ via letter dated January 8, 2021, thereby willing to remain in SEZ development." The unit's proposed investment is priced at Rs 2,860.85 crore.


The zone's letter of approval (LoA) had expired the previous year. “The extension was granted after the company withdrawn its bid to leave the SEZ earlier this year. As a result, before determining if the unit deserves an extension, the Department of Revenue needs a more detailed briefing on the unit and its plans,” the source added.


Mundra Solar's request for a two-year extension of its LoA (until April 2022) claimed that its technical team is currently working on advanced direct wafering technology, which will further minimise wafer manufacturing's operating costs. This will make the project more commercially and logistically feasible.


Customs penalty on solar cells


With impact from April 1, 2022, India will place a simple customs duty of 25% on imported solar PV cells and 40% on imported solar PV modules, making domestic manufacturing more competitive.


The DC advised the BoA to consider the proposal because it was an environmentally sustainable undertaking. “The BoA will now make a decision on the matter only at a later meeting after the DC submits further details,” the source said.


The BoA has granted a year's extension to Wockhardt's planned inhaler and nasal dose manufacturing unit in the Aurangabad SEZ. The project is yet to get off the ground, according to the unit, leading to a delay in regulatory approvals from agencies including the US Food and Drug Administration (USFDA) due to the Covid-19 pandemic.


The BoA is the highest decision-making body for SEZs, led by the Commerce Secretary and made up of senior officials from a variety of ministries and agencies, including banking, agriculture, and housing.

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