But with flexible labour laws

The finance ministry's reported insistence on inclusion of some sort of an employment criterion for special economic zones (SEZs) is totally justified. As conceived, SEZs are clearly based on doubtful assumptions and benefits, and are potentially a huge drain on the exchequer. That being the case, the government should, in return, ask for some sort of fillip to employment generation through units located in SEZs.
One of the criteria for allowing an SEZ, as laid down in the SEZ Act 2005, is the creation of employment opportunities. Indeed, given the slow pace of employment generation, there is no arguing that market mechanism alone would not suffice and some sort of state intervention is needed. If that happens through non-coercive means such as asking the industries located in SEZs to employ a certain minimum numbers in exchange then the industry should not complain. In fact, the employment criteria is not even the give-and-take it is made out to be, at least in the case of manufacturing.