Two new SEZs notified in Puducherry, ₹1,975 crore investment expected
Synopsis
India's SEZ story just hit a first: the Union government has approved a Puducherry IT zone to be built by a municipality — Oulgaret — making it the first SEZ in the country developed by an Urban Local Body. Paired with a ₹1,250 crore multi-sector zone by PIPDIC, the two approvals together promise ₹1,975 crore in investment and 8,500 jobs for the Union Territory.
Key Takeaways
The Union government notified two new SEZs in Puducherry on 29 May 2025 , approved by the Board of Approval for SEZs .
M/s Oulgaret Municipality will develop an IT/ITES SEZ at Thattanchavady village — the first SEZ in India developed by an Urban Local Body.
The Oulgaret IT/ITES SEZ covers 8.623 hectare with a proposed investment of ₹725 crore and is expected to create 3,500 jobs .
PIPDIC will develop a Multi-Sector SEZ at Karasur village, Villianur Taluk across 86.2457 hectare , with a proposed investment of ₹1,250 crore and 5,000 jobs projected.
Combined proposed investment across both zones: ₹1,975 crore ; total projected employment: 8,500 people .
The Union government has formally notified two new Special Economic Zones (SEZs) in Puducherry, with a combined proposed investment of ₹1,975 crore and the potential to generate employment for up to 8,500 people, according to an official statement issued on Friday, 29 May. The approvals were granted by the Board of Approval for SEZs under the Department of Commerce at a meeting held on Thursday.
Key Developments
The two newly notified SEZs mark a significant step for Puducherry's industrial and export-led growth ambitions. Officials described the approvals as a major milestone expected to expand avenues for investment, manufacturing, and high-quality employment in the Union Territory.
Notably, one of the two zones will be the first SEZ in India to be developed by an Urban Local Body — a distinction that sets this project apart from all previous SEZ approvals in the country.
The IT/ITES SEZ by Oulgaret Municipality
M/s Oulgaret Municipality will develop an IT/ITES SEZ at Thattanchavady village in Oulgaret Taluk, spread across 8.623 hectare. The proposed investment stands at ₹725 crore, and the zone is expected to create as many as 3,500 direct and indirect jobs. The fact that a municipality — rather than a private developer or state industrial corporation — is spearheading this SEZ makes it an unprecedented model in Indian SEZ history.
The Multi-Sector SEZ by PIPDIC
The second zone, a Multi-Sector SEZ, will be developed by M/s Pondicherry Industrial Promotion Development and Investment Corporation (PIPDIC) at Karasur village in Villianur Taluk. Spanning 86.2457 hectare, the project carries a proposed investment of ₹1,250 crore and is projected to generate employment for 5,000 people across direct and indirect categories, according to the official statement.
Broader Regional and Strategic Context
The approvals are framed within the growth momentum of the Tamil Nadu, Andaman and Puducherry (TAP) Region, where diversified sectors and large-scale projects are increasingly contributing to employment generation and regional economic development. This comes amid a sustained Centre-level push to expand SEZ-led industrial activity as part of a wider strategy to attract investment, boost exports, and deepen self-reliance in strategic sectors.
According to the official statement, the notifications 'reflect a broader strategy aimed at strengthening India's industrial, technology, manufacturing, and services ecosystem through diversified SEZ-led growth, thereby enhancing resilience and scale to boost the economy, attract investment, and generate employment.'
What Happens Next
With formal notification in place, both projects are expected to move into the development and operationalisation phase. Industry observers will watch closely whether the municipality-led IT/ITES model in Oulgaret attracts replication in other Urban Local Bodies across the country, potentially opening a new channel for urban-led export zone development.
Point of View
But for its model. If a municipal body can anchor an IT/ITES export zone, it potentially unlocks a new tier of SEZ developers beyond the usual private-developer or state-corporation duopoly. Whether this remains a one-off or becomes a replicable template will depend entirely on execution and whether the municipality can navigate the regulatory and infrastructure demands that have tripped up far larger SEZ developers. On the investment side, ₹1,975 crore across two zones is modest by national SEZ standards, but meaningful for a small Union Territory like Puducherry, where every large-format industrial approval carries outsized regional weight.
NationPress
12 Aug 2026
Frequently Asked Questions
What are the two new SEZs notified in Puducherry?
The two newly notified SEZs are an IT/ITES SEZ at Thattanchavady village in Oulgaret Taluk, to be developed by M/s Oulgaret Municipality, and a Multi-Sector SEZ at Karasur village in Villianur Taluk, to be developed by PIPDIC. Both were approved by the Board of Approval for SEZs under the Department of Commerce on Thursday, 29 May 2025.
Why is the Oulgaret Municipality SEZ historically significant?
It will be the first SEZ in India to be developed by an Urban Local Body such as a municipality. All previous SEZs have been developed by private entities or state industrial corporations, making this a precedent-setting approval.
How much investment and employment are the two Puducherry SEZs expected to generate?
The IT/ITES SEZ carries a proposed investment of ₹725 crore and is expected to create 3,500 direct and indirect jobs. The Multi-Sector SEZ has a proposed investment of ₹1,250 crore and is projected to generate employment for 5,000 people, bringing the combined total to ₹1,975 crore in investment and 8,500 jobs.
Who approved the two new SEZs in Puducherry?
The Board of Approval for SEZs under the Department of Commerce approved both proposals at a meeting held on Thursday, 29 May 2025. The Union government subsequently issued the formal notifications.
How do these SEZs fit into India's broader industrial strategy?
According to the official statement, the notifications are part of a broader strategy to strengthen India's industrial, technology, manufacturing, and services ecosystem through SEZ-led growth. They also align with the growth momentum of the Tamil Nadu, Andaman and Puducherry (TAP) Region, which is increasingly contributing to employment generation and regional economic development.
