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Performance of Export Processing Zones: a Comparative Analysis of India, Sri Lanka and Bangladesh A Service of Leibniz-Informationszentrum econstor Wirtschaft Leibniz Information Centre Make Your Publications Visible. zbw for Economics Aggarwal, Aradhna Working Paper Performance of export processing zones: a comparative analysis of India, Sri Lanka and Bangladesh Working Paper, No. 155 Provided in Cooperation with: Indian Council for Research on International Economic Relations (ICRIER) Suggested Citation: Aggarwal, Aradhna (2005) : Performance of export processing zones: a comparative analysis of India, Sri Lanka and Bangladesh, Working Paper, No. 155, Indian Council for Research on International Economic Relations (ICRIER), New Delhi This Version is available at: http://hdl.handle.net/10419/176177 Standard-Nutzungsbedingungen: Terms of use: Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Documents in EconStor may be saved and copied for your Zwecken und zum Privatgebrauch gespeichert und kopiert werden. personal and scholarly purposes. Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle You are not to copy documents for public or commercial Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich purposes, to exhibit the documents publicly, to make them machen, vertreiben oder anderweitig nutzen. publicly available on the internet, or to distribute or otherwise use the documents in public. Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, If the documents have been made available under an Open gelten abweichend von diesen Nutzungsbedingungen die in der dort Content Licence (especially Creative Commons Licences), you genannten Lizenz gewährten Nutzungsrechte. may exercise further usage rights as specified in the indicated licence. www.econstor.eu WORKING PAPER NO. 155 PERFORMANCE OF EXPORT PROCESSING ZONES: A COMPARATIVE ANALYSIS OF INDIA, SRI LANKA AND BANGLADESH Aradhna Aggarwal MARCH 2005 INDIAN COUNCIL FOR RESEARCH ON INTERNATIONAL ECONOMIC RELATIONS Core-6A, 4th Floor, India Habitat Centre, Lodi Road, New Delhi-110 003 Website: www.icrier.org PERFORMANCE OF EXPORT PROCESSING ZONES: A COMPARATIVE ANALYSIS OF INDIA, SRI LANKA AND BANGLADESH Aradhna Aggarwal MARCH 2005 The views expressed in the ICRIER Working Paper Series are those of the author(s) and do not necessarily reflect those of the Indian Council for Research on International Economic Relations (ICRIER). Content List of Tables................................................................................................................................ iii List of Figures............................................................................................................................... iv Foreword........................................................................................................................................ v 1. Introduction....................................................................................................................... 1 2. Theory of EPZs................................................................................................................. 4 3. Evolution of the EPZ Policy : A Comparative Analysis of India, Bangladesh and Sri Lanka.................................................................................................................................. 7 3.1. India ..........................................................................................................................7 3.1.1. Initia l Phase : 1965-1985.......................................................................................................................... 7 3.1.2. Expansionary Phase : 1985-1991............................................................................................................ 8 3.1.3. Consolidating Phase : 1991-2000............................................................................................................ 8 3.1.4. Emergence Phase : 2000 onwards .......................................................................................................... 9 3.2. Sri Lanka .................................................................................................................10 3.2.1. First Phase : 1978-1990 ......................................................................................................................... 10 3.2.2. Second Phase : 1990-1998..................................................................................................................... 11 3.2.3. Third Phase : 1998 onwards .................................................................................................................. 12 3.3. Bangladesh...............................................................................................................12 3.3.1. First Phase : 1984-1998.......................................................................................................................... 12 3.3.2. Second Phase : 1998 Onwards............................................................................................................. 13 4. Governance of the zones : A Comparative Analysis.................................................... 15 4.1. Administrative set up................................................................................................15 4.1.1. India ........................................................................................................................................................... 15 4.1.2. Sri Lanka ................................................................................................................................................... 17 4.1.3. Bangladesh ............................................................................................................................................... 18 4.2. Administrative Procedures ........................................................................................20 4.2.1. India ........................................................................................................................................................... 20 4.2.2. Sri Lanka ................................................................................................................................................... 23 4.2.3. Bangladesh ............................................................................................................................................... 24 4.3. Quality of Governance : Entrepreneurs’ Perspective...................................................25 5. Incentives : A Comparative analysis ............................................................................. 28 5.1. India ........................................................................................................................28 5.2. Sri Lanka .................................................................................................................31 5.3. Bangladesh...............................................................................................................33 i 6. Infrastructure : A Comparative analysis...................................................................... 36 6.1. The Provision of Infrastructure Facilities by the Zones................................................36 6.2. Quality of infrastructure............................................................................................38 7. EPZ Performance : India, Bangladesh and Sri Lanka................................................ 42 7.1. Expansion in Zone Investment and Employment.........................................................42 7.1.1. Country-Level Analysis ......................................................................................................................... 42 7.1.2. Zone-Wise Analysis ................................................................................................................................ 44 7.2. Export Performance..................................................................................................48 7.2.1. Share in Total Exports : Aggregate Analysis ..................................................................................... 48 7.2.2. Growth Rates in Exports : Aggregate Analysis ................................................................................. 49 7.2.3. Export-Performance : Zone-Wise Analysis ........................................................................................ 51 7.3. Sectoral Composition of Exports...............................................................................53 8. Variation in the Zone Performance : Our Hypotheses ............................................... 57 9. Research Methodology and Empirical Results ............................................................ 63 9.1. Primary Survey Based Analysis .................................................................................64 9.1.1. Infrastructure ............................................................................................................................................ 66 9.1.2. Location..................................................................................................................................................... 67 9.1.3. Incentives.................................................................................................................................................. 69 9.1.4. Governance..............................................................................................................................................
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