Intro Paragraph:
The Special Economic Zones (Amendment) Rules, 2025 bring a strategic boost to semiconductor manufacturing in SEZs and ease land usage norms. As notified by the Commerce Department in June 2025, these changes align with India’s ‘Make in India’ and chip self-reliance mission.
What Changed in SEZ Rules 2025?
Here’s a simplified overview of the key amendments:
| Area | What’s New in 2025 |
|---|---|
| Semiconductor Units | Special provision inserted to prioritise chip manufacturing units in SEZs |
| Land Norm Relaxation | Developers can now use up to 25% of SEZ land for non-processing use (vs 15% earlier) |
| Sub-division of SEZ Land | Allowed with government approval, enabling flexible land usage and leasing |
| Green/Blue Economy Focus | Units in renewable, hydrogen, or ocean tech sectors given priority |
| IT/ITES SEZ Units | Norms relaxed for work-from-home and hybrid arrangements for export units |
| De-notification Process | Streamlined with single-window clearance in coordination with state authorities |
| Compliance Simplification | Developers can self-certify built-up area requirements for faster approvals |
| Single Window Interface | Strengthened for SEZ units with faster online processing of approvals and reporting |
Focus on Semiconductor Manufacturing in SEZs
The amendment introduces a dedicated provision under Rule 5 for setting up semiconductor fabrication and assembly/testing units. Benefits include:
- Faster land allocation in SEZs
- Relaxed processing zone norms
- Special priority by Board of Approval (BoA)
- Alignment with India Semiconductor Mission incentives
👉 Efiletax Tip: Companies setting up such units can combine SEZ benefits with PLI (Production Linked Incentive) schemes for electronics.
Land Use Norms Eased for SEZ Developers
Relaxation in land usage norms is a game-changer:
- Earlier cap: 15% of total SEZ area for non-processing use (e.g. housing, retail)
- New limit: 25%, subject to defined conditions
This makes SEZs more viable for integrated township development and attracting talent.
Legal Reference & Government Source
- 📜 Notification Link – SEZ (Amendment) Rules, 2025 – egazette.gov.in
- Issued under Section 55 of SEZ Act, 2005 by Department of Commerce
- Rules aligned with PM Gati Shakti & National Logistics Policy initiatives
Expert Perspective
“These SEZ rule changes unlock long-pending demand from developers and global chip firms. By easing land norms and fast-tracking semiconductor projects, India’s SEZs are finally future-ready.”
— R. Sivaraman, Policy Analyst, Efiletax
FAQ: SEZ Rules 2025
Q1: Can existing SEZ developers benefit from new land usage norms?
Yes. Existing SEZs can apply to use additional area (up to 25%) for non-processing purposes, post approval.
Q2: Are IT/ITES units still required to operate from SEZ premises?
Rules now allow hybrid and WFH models with relaxed compliance.
Q3: How do these rules impact foreign semiconductor companies?
They offer faster land access, SEZ tax benefits, and sync with India’s chip subsidy roadmap.
Summary
SEZ Rules 2025 allow up to 25% non-processing land use and fast-track semiconductor units in SEZs. Boost to India’s chip and green economy missions.