The Commerce & Industry Ministry has decided to recommend an extension of two years or more to the hybrid working model of IT-ITeS units operating in SEZs beyond the year-end when the one-year extension given last year is set to lapse, sources said.

The hybrid model allows IT-ITeS units to permit their employees to work from any place outside the SEZ as long as the unit is physically operating in the zone.

“The Commerce & Industry Ministry is ready to extend the hybrid model for more than a year, possibly two-five years. A decision has been taken on the matter,” a source tracking the matter told businessline.

The concurrence of the Directorate General of Exports Promotion (DGEP), an arm of the Central Board of Indirect Taxes and Customs, will be sought for the extension following which the Commerce Department will come up with the required notification, the source added.

Industry body Nasscom had earlier recommended a shift from the work from home model to a hybrid one as it would ensure that SEZ units continued to operate from the SEZs and real estate developers did not lose out on their business. At the same time units, too, would have the flexibility of allowing their workers to work from outside the zone adding to overall efficiency.

While the IT-ITeS industry wants to be allowed to continue with the hybrid model in perpetuity, the government is not willing to provide the flexibility without an end date.

“Covid-19 created a situation where employees were forced to work from home. But it is long over now and IT companies such as Amazon and TCS are laying stress on the importance of working from office. The government understands that some more time may be needed for all workers to start operating from office and is ready to allow the hybrid model for a longer period. But there doesn’t seem to be a need to extend it perpetually,” the source said.