Financial Times FT.com

Attack on India’s economic zone plan

By Jo Johnson in New Delhi

Published: September 24 2006 19:37 | Last updated: September 24 2006 19:37

Divisions over a central plank of India’s strategy to attract investment deepened over the weekend when Sonia Gandhi, president of the Congress party, added her powerful voice to those urging curbs on new tax-advantaged special economic zones.

Since the passing of the Special Economic Zones Act in February, hundreds of businesses have rushed to take advantage of generous tax breaks, causing consternation in the finance ministry, the central bank and even the International Monetary Fund.

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