INDUSTRIAL SUBSIDY POLICIES

Central Govt. Policies & State Govt. Policies

Central Government Policies

Scheme
SPECS – Scheme for Promotion of Manufacturing of Electronic Components and Semiconductors.

Applicability Period
01.04.2020 – 31.03.2023

Eligible Capital Investment (Fixed Capital Investment –FCI)

  • Plant & Machinery

  • Tools And Equipment

  • Dies, Moulds, etc.

  • Associated Utilities

  • Research and Development Expenses

Benefits /Incentives 25% of FCI (As approved by IFCI)

For Example: 
Total Fixed Capital Investment (As approved eligible by IFCI)

Rs 1,00,00,000/-

Incentive Calculation
25% of Rs. 1,00,00,000/-

Incentive Amount
Rs. 25,00,000/-

 

Investment Eligibility period

5 years from the date of Acknowledgement.

Key Points

Investment made after the date of acknowledgement shall be considered for incentives.

Minimum Threshold limit should be met.

Production Linked Incentive (PLI) 

The Central Government of India has announced an outlay of INR 1.97 Lakh Crores for the Production Linked Incentive (PLI) Schemes across 13 key sectors, including pharma, automobiles, textiles, etc. to generate employment opportunities for the country’s youth. The scheme is introduced to promote local manufacturing under Atmanirbhar Bharat Abhiyan and reduce the dependency on imports.

The prime objective of the PLI scheme is to enhance the manufacturing capacities by increasing the investment and production. Also, to create global champions out of India who have the potential to grow in size and scale using technology and penetrate the global value chains.

The benefit of the scheme is conferred on the incremental sales ranging from 4% up to 13% depending on the respective sectors.

Design Linked Incentive Scheme (DLI) 

Name of the Scheme : Design Linked Incentive Scheme for Semiconductors.

Application period : 3 years from 1.01.2022

Eligibility criteria : 1. Domestic Companies 2. MSMEs 3. Start up

Incentive : Deployment Linked Incentive - 4 to 6 % on Net sales of designed semiconductor goods subject to ceiling cap of Rs.30 Cr per application. 

Benefits : 1. Design Infrastructure Support – Reimbursement up to Rs.30 lakhs for MPW Fabrication of design and post-silicon validation activities. 2. Product Design Linked Incentive – up to 50 % of eligible expenditure subject to minimum of 15 Cr per application. 

Target Segment : 1. Integrated circuits (ICs)  2. Chipsets  3. System of chips (SoCs)  4. System or IP Cores and Semiconductor Linked Design

Benefit period : These benefits to be taken during the period of 5 years.

State Government Policies

Madhya Pradesh:
MSME Promotion Policy 2021 (Capital subsidy):

Conferring Upto 40% CAPITAL subsidy

benefit on
eligible Fixed Capital Investment.
(Industrial Development Assistance)

Additional benefits

for Women

Entrepreneur and
Export Oriented Unit.

Up to 25% reimbursement for quality
certification

100% reimbursement of fees incurred for Patent
and IPR's

50% reimbursement of expenses incurred for
setting up of Effluent Treatment Plant (ETP)

Industrial Promotion Subsidy Scheme for Large / Mega & Ultra-Mega:

Highlight of Basket of Incentives up to 100% are as follows:

BENEFITS

Investment Promotion Assistance (IPA)

Interest Subsidy

Power tariff – Rebate

Electricity Duty Exemption

Water, Power & Road Infrastructure

Set up of Waste Management System

Mandi fee Exemption (For Food Industry)

QUANTUM​

Capital subsidy up to 40% of investment in Plant and Machinery

5% to 7% for a period of 7 years

INR 1 per unit

For a period of 5-10 years

50% of Investment made

 

Capital Subsidy of 50%

 

5 years

Rajasthan:

Rajasthan Investment Promotion Scheme - 2019

 

APPLICABILITY OF THE SCHEME

 

1) New unit

2) existing enterprises making investment for setting up new units

3) Existing enterprises making investment for expansion

 

Benefits for Manufacturing enterprises and Service enterprises

Investment Subsidy of 75% of State tax due and deposited, for seven years

Employment Generation Subsidy in the form of reimbursement of 50% of employers’ contribution towards employees EPF and ESI, for 7 years

Exemption from payment of 100% of Electricity Duty, Land Tax, Stamp Duty, Land Conversion charges for 7 years 

Additional benefits for manufacturing and service enterprises in thrust sector:

5% Interest subsidy on term loan of plant machinery (5 years)

20% Capital subsidy on plant machinery

or

Uttar Pradesh:
Industrial Investment and Employment Promotion Policy of Uttar Pradesh-2017

The Uttar Pradesh government’s investment policy is aimed at providing a fillip to industries, especially in the backward eastern UP and Bundelkhand regions.

SGST Reimbursement upto 90%

Stamp duty exemption upto 100%

Capital interest subsidy upto 5% per annum

Electricity duty exemption upto 100%

Mandi fee exemption upto 100%

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