Exports from special economic zones (SEZs) paced up 15.4 per cent to Rs 1.35 lakh crore during the first quarter of this fiscal, according to Commerce Ministry data.

According to industry analysts, exports are growing from these zones, but observed that the government should do more to step up shipments.

“In the GST (Goods and Services Tax) regime, units in SEZs have advantage compared to the units in domestic tariff area,” the Chairman of Export Promotion Council for EOUs and SEZs (EPCES), Rahul Gupta, pointed out.

He felt that the government should set up a proper refund mechanism for duties to be paid by SEZs when they buy products from outside these zones.

Exports grew about 12 per cent to Rs 5.24 lakh crore in 2016-17 against Rs 4.67 lakh crore in the previous fiscal.

According to the ministry data, these zones have attracted investments worth Rs 4.33 lakh crore up to June this year. The highest number of SEZs are operational in states like Tamil Nadu, Karnataka, Telangana and Maharashtra.

Till September 7, the government has approved as many as 424 zones, of which 222 are operational.

With an aim to promote exports from these zones, supplies from the domestic market to special economic zones are treated on par with exports under the Goods and Services Tax (GST) regime.

According to EPCES, SEZ developers and units receiving such supplies were required to pay duties first and then seek refund, which is a cumbersome process.

Exports from SEZs and export oriented units (EOUs) contributed about 33 per cent to the country’s total shipments.