Why in news?

1. Recently, the government approved the establishment of India’s first mega coastal economic zone (CEZ) at Jawaharlal Nehru Port (JNPT) in Maharashtra.
2. The CEZ will be located in the north Konkan region spread across Nasik, Thane, Mumbai, Pune, and Raigarh.
3. It will be part of 14 mega CEZ under the National Perspective Plan of the Sagarmala Programme.

What is Coastal Economic Zone?

1. It is a spatial economic region that could extend along 300-500 km of coastline and around 200-300 km inland from the coastline.
2. Each CEZ will be a grouping of coastal districts within a state.
3. It will provide a geographical boundary within which port led industrialization can be developed through uniform policy along the ports and coastal states.
4. Under CEZ, investor and business-friendly environment including ease of doing business, swift environmental clearances etc.

Significance

1. These CEZs are aimed at promoting the development of port-proximate industrial clusters, encourage port-led development, reduction of logistics costs and time for the movement of goods and enhance the global competitiveness of Indian manufacturing sector.
2. CEZ will facilitate export-led coastal economy based on labour-intensive sectors and will result in employment creation.
3. It will increase export growth since large manufacturing industries are assisted by ancillary industries in the CEZ.
4. CEZ would attract foreign investments with technology, capital, goods management and connections to the global markets.
5. It will create an ecosystem around the CEZ in which productive cluster of the small and medium firm would arise and flourish.

Challenges

1. Lack of availability of land with the states along with huge acquisition and compensation costs have delayed the implementation of the project.
2. Lack of sufficient infrastructure for evacuation of cargo at major and non-major ports resulting in a poor mix of modal transportation, low penetration of coastal and inland shipping, lack of scale and deep draft at ports also lead to the poor growth.
3. Involvement of multiple agencies might lead to a fragmented approach in the development of infrastructure for promoting industrialization, trade, tourism, and transportation across the country.

Way forward

Port-led industrialization through the development of CEZ expected to provide impetus to the “Make in India” initiative of the Government of India that will aid in the creation of jobs in India. However, speedier clearances without concern for the environment will be detrimental for the sustainable development as well. Hence proper environment impact assessment is needed before the actual implementation

Practice question

Critically evaluate the features, significance, and challenges associated with the development of Coastal Economic Zone in India.