Consider the following statements regarding the "Special Economic Zones" (SEZs): 1. They are industrial zones set up to have world-class facilities such as electricity and transport. 2. The primary objective of SEZs is to promote the consumption of goods within the domestic market. 3. Companies in SEZs are offered flexibility in labour laws to attract foreign investment. Which of the statements given above is/are correct?

The correct option is 1 and 3 only. Explanation Special Economic Zones (SEZs) are specifically delineated duty-free enclaves that are deemed to be foreign territory for the purposes of trade operations, duties, and tariffs. They are established to enhance economic activity, promote exports, and attract investment. Statement-wise Analysis: - Statement 1 is Correct: SEZs are industrial zones set up by the government or private developers to provide world-class facilities. These include reliable electricity, water, roads, transport, storage, and recreational and educational facilities to support industrial activity. - Statement 2 is Incorrect: The primary objective of SEZs is to promote exports and generate foreign exchange. While goods from SEZs can be sold in the Domestic Tariff Area (DTA), the main goal is not domestic consumption. Sales to the domestic market are subject to applicable customs duties and import policies. - Statement 3 is Correct: To attract foreign investment and ensure ease of doing business, companies in SEZs are offered flexibility in labor laws. Many state governments have delegated powers to Development Commissioners or declared SEZs as "Public Utility Services" to minimize labor disputes and compliance burdens. Key Takeaway: SEZs are designed primarily for export promotion and attracting Foreign Direct Investment (FDI) by offering tax incentives, superior infrastructure, and relaxed regulatory frameworks compared to the rest of the country.

NCERT Class 10 Economics — Chapter 4: Globalisation and the Indian Economy

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Consider the following statements regarding the "Special Economic Zones" (SEZs):

They are industrial zones set up to have world-class facilities such as electricity and transport.
The primary objective of SEZs is to promote the consumption of goods within the domestic market.
Companies in SEZs are offered flexibility in labour laws to attract foreign investment.

Which of the statements given above is/are correct?

Official previous-year question

Verified 1 Aug 2026.

Options

A1 and 2 only
B1 and 3 only
C1, 2 and 3
D2 only

Did you get this right?

Solution

The correct option is 1 and 3 only.

Explanation

Special Economic Zones (SEZs) are specifically delineated duty-free enclaves that are deemed to be foreign territory for the purposes of trade operations, duties, and tariffs. They are established to enhance economic activity, promote exports, and attract investment.

Statement-wise Analysis:

Statement 1 is Correct: SEZs are industrial zones set up by the government or private developers to provide world-class facilities. These include reliable electricity, water, roads, transport, storage, and recreational and educational facilities to support industrial activity.
Statement 2 is Incorrect: The primary objective of SEZs is to promote exports and generate foreign exchange. While goods from SEZs can be sold in the Domestic Tariff Area (DTA), the main goal is not domestic consumption. Sales to the domestic market are subject to applicable customs duties and import policies.
Statement 3 is Correct: To attract foreign investment and ensure ease of doing business, companies in SEZs are offered flexibility in labor laws. Many state governments have delegated powers to Development Commissioners or declared SEZs as "Public Utility Services" to minimize labor disputes and compliance burdens.

Key Takeaway:

SEZs are designed primarily for export promotion and attracting Foreign Direct Investment (FDI) by offering tax incentives, superior infrastructure, and relaxed regulatory frameworks compared to the rest of the country.

Your note

More from Chapter 4: Globalisation and the Indian Economy

The term "Containerisation" in the context of globalisation has primarily led to: 1. Huge reduction in port handling costs. 2. Increased time required for the delivery of goods to export markets. 3. Ability to load goods intact onto ships, railways, planes, and trucks. Which of the statements given above is/are correct?

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Which international organisation is primarily mandated to establish rules regarding global trade and ensure their compliance?

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The rapid improvement in which of the following has been the major factor stimulating the globalisation process?

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Which one of the following is NOT a primary factor considered by Multinational Corporations (MNCs) when establishing production units in a country?

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In the context of globalisation in India, which one of the following industries has generally remained resilient compared to others where small manufacturers faced stiff competition?

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The correct option is 1 and 3 only.

Explanation

Statement-wise Analysis:

Statement 1 is Correct: SEZs are industrial zones set up by the government or private developers to provide world-class facilities. These include reliable electricity, water, roads, transport, storage, and recreational and educational facilities to support industrial activity.
Statement 2 is Incorrect: The primary objective of SEZs is to promote exports and generate foreign exchange. While goods from SEZs can be sold in the Domestic Tariff Area (DTA), the main goal is not domestic consumption. Sales to the domestic market are subject to applicable customs duties and import policies.
Statement 3 is Correct: To attract foreign investment and ensure ease of doing business, companies in SEZs are offered flexibility in labor laws. Many state governments have delegated powers to Development Commissioners or declared SEZs as "Public Utility Services" to minimize labor disputes and compliance burdens.

Key Takeaway: