Political Economy of India’s Special Economic Zones: a Conceptual Frame Work

 Every nation stands for its personal development. For this purpose the state introduces and implements new policies and programmes such as Specific Economic Zones Act. Right after 60 years of its independence India with its 110 core population has evolved a new paradigm of its political economic climate which is confusing. The policies and programmes initiated by Indian government to make a ‘global village' based on free market place economy and free trade among nations cutting across all barriers, abolition of national boundaries and dismantling the nation –state program giving priority to ‘market' over the ‘state' . Right after the enactment of Unique Economic Zone Act 2005, it made tremendous effects on political economic climate of the nation.

            The term ‘political economy' came from the two Greek words ‘Politiko' and ‘Oikonomia, where ‘Politiko' stands for the state and society and ‘Oikonomia'means managing the property hold economic climate. Political economic climate therefore indicates a study of the state, society and home hold economic climate. The idea of political economic climate arose historically as the economic doctrine of a new class – the capitalist class. It has been evolved considering the fact that the days of Aristotle who gave a model of public really good via guaranteeing each and every person private possession of what he was rationally and morally entitled. Private property was elaborated later by Locke, Adam Smith, Ricardo and the physiocrates, who came to be known as the Laissez Fairists in Economics, or, the liberal democrats in politics. Adam Smith referred to political economy as a branch of the method of civil government. It was concerned with public policy.

            In Marxian view, political economic climate can be regarded as a subject which studies the social relations evolves among various classes of persons in course of production, distribution, exchange and consumption. Political economic climate belongs to the broad land of economics, which opens on to political science. Following a prolonged period of hibernation, the topic has once again been resurrected.

Marxist political economy makes a study of how the productive forces are utilised below the offered relations of production taking account of the lines and trends in technical progress political economy research the influence of production relations on such progress and its socio economic consequences. Marxist political economy begins from the assumption that human important activity is objectively based on social material production which consists of man's interactions with the nature and whole range of relations which arise in the course of action. It has been realized that every political action has its obvious economic repercussion, and each and every economic action has had its political implications.

 The liberal school of political economy gives economic implications of political details and aspects. The liberal school has economized politics. The liberal method focuses on the atomistic individual as the pertinent unit, on the description of economic behavior in terms of subject choices among options, on the notion of social welfare as the maximizations of individual utility sums. The socialist system views the complete economic program as the standard unit, views economic progress in terms of the growth of the forces of production and focuses on ‘relations of production' ‘surplus value' and the rapid raise of social product.

By contrast the Gandhian method eschews each the notions of the atomistic autonomous individual maximizing his utility in a self regulating economy and the notion of processes of production autonomously effecting changes in the organization of production ,class relationship and the magnitude and distribution of social product instead of the Gandhian model recommend that the basic attribute of human economic behaviour lies in the relationship of individual to socioeconomic micro groups and the relationship of micro groups to society .The standard economic act is neither the alternative among economic alternatives nor the social division of natural goods, but the adjustment amongst individual and the micro groups to which they belong, and of those micro groups to society .It is this collaboration which is the simple theme of the Gandhian program of political economy.

The Gandhian method is viewed in micro groups that are basic constituents of the economic program and given full scope to develop their prospective in the context of no coercive forms of political manage. Social welfare is defined in terms of the functioning of the collaborative micro groups vis –a-vis its members. Gandhi believed that the introduction of technology and patterns of improvement need to be consistent with the complete employment objective.

Right now economist speaks of sustainable improvement and ecological values. Gandhi was not against industry but as he predicted it could not give many people even more employment. His constructive programmes were to give employment to all people no matter whether it be kadhi, gobar gas or tree plantations, where all can be engaged in constructive function. Gandhian economics is an alternative to overcome the exploitation of both capitalism and communism for the exponents of human social order.He was against the massive scale use of machinery which kept millions without having work. Swadeshi is one particular of the core components in the socio-economic organisation of Gandhian method.

Gandhi observes

                       "Life here will not be a pyramid with the apex sustained by the bottom, but it will be an oceanic circle whose centre will be the individual, consistently prepared to perish for the village, the latter prepared to perish for the circle of the villages, till at final the complete becomes one life composed of individual, never ever aggressive in their arrogance, but ever humble sharing the majesty of the oceanic circle of which they are integral units'. The idea of the circle stands for integrating, fullness and self-sufficiency. He wrote that independence need to begin at the bottom. Therefore each village will be a republic or Panchayat getting complete powers. It follows for this reason, that just about every village has to be self sustained and capable of managing its affairs even to the extent of defending itself against the entire world."

 Politics and economy are thought to be as two basic aspects in figuring out the nature of the state and society. They are interrelated to such an extent that the adjustments in one influence the other, and hence each are ‘dynamic' and ‘flexible' ingredients of the national and the international systems. Politics and economy taken together as political economy refers to ‘managing the economic climate of the state'. Conceptually political economic climate connotes the relationship between the state, society and the economic climate, the cause–effect connection amongst technological change and the course of action of improvement, the economic relations among the diverse nations of the globe.

DEFINITION OF Special ECONOMIC ZONE

            A special economic zones is a geographical region that has economic laws even more liberal than a countries typical economic laws. According to the SEZ Act 2005, A SEZ is a ‘specially delineated duty zero cost enclave and shall be deemed to be foreign territory for the objective of trade operations and duties and tariffs. A SEZ also been viewed as "a geographical region with several economic laws than a nations typical economic laws with the major goal of attracting foreign investment'. "A SEZ or a Totally free Trade Zone (FTZ) is normally an enclave of units operating in a well –defined area inside the geographical boundary of a nation exactly where certain economic activities are promoted by a set of policy measures that are normally not applicable to the rest of the country".

            The notion of special economic zones is not new. In an International Labour Organization (ILO) report traces the roots of the notion to 13th centaury Spain and in additional latest times to Ireland and Puerto Rico, which established Export Processing Zones (EPZ). Export Processing Zones is the former name of the Unique Economic Zones. The countries like China, United Arab Emirates, Malaysia, India, Jordan, Philippines and Russia have utilized the notion of SEZ. In 1986, there were 176 zones across 47 countries. Now the quantity has increased to more than 5000 across 147 countries.  

The zones are known by diverse names in completely different parts of the planet. Most commonly these are Cost-free Trade Zones  (FTZ),Industrial Absolutely free Zones (IFS) Export Processing Zones (EPZ) Bonded Totally free Zones and Unique Economic Zones (SEZ).

          Export Processing Zone is the ancestor of SEZ. An Export Processing Zone is somewhat compact geographically spread location within a country. The purpose of which is to attract export oriented industries, by providing them specially favorable investment and trade circumstances as compared with the reminder of the host nation. The EPZ is just an industrial enclave but SEZ is an integrated township with totally developed infrastructure. The UN Industrial Development Organization (UNID) identifies five simple attributes of EPZ s are: