RBI proposes to classify lending by banks for purchase of land and development thereof (for setting up Special Economic Zones or SEZs) as Infrastructure Lending. Draft Guidelines on ‘Classification of Exposures as Commercial Real Estate Exposures’ were posted on the RBI’s website for public comments on January 7, 2009.
Coming to the rescue of the export-sector, badly hit by recession in the US and several European economies, the government has asked RBI to grant infrastructure status to SEZs. The rationale is that this special status will entail tax benifits and import duty reliefs. Hopefully, this long-standing demand of the export sector will afford the much needed relief in these particularly hard-times.
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