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
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%
Gujarat:
Aatmanirbhar Gujarat Scheme for both MSMEs (Micro, Small, and Medium Enterprises) and Large Sectors:
Benefits
MSME Sector
Large Sector
Period of Investment
From 05/10/2022 to an extended 12 months
From 05/10/2022 to an extended 12 months
Eligible Fixed Capital Investment (EFCI)
-
New Building
-
Other construction
-
Plant and Machinery, including second machinery
-
Project-related infrastructure (up to 20%)
-
New Building
-
Other construction
-
Plant and Machinery, including second machinery
-
Project-related infrastructure (up to 20%)
Interest Subsidy
Category 1:
7% interest subsidy on term loan with a maximum amount of 35 lakhs for 7 years
Category 2:
6% interest subsidy on term loan with a maximum amount of 30 lakhs for 6 years
Category 3 & Municipal Corporation Areas:
5% interest subsidy on term loan with a maximum amount of 25 lakhs for 5 years
Category 1:
7% interest subsidy on term loan up to 1% of EFCI p.a for 10 years.
Category 2:
7% interest subsidy on term loan up to 1% of EFCI p.a for 8 years.
Category 3 & Municipal Corporation Areas:
7% interest subsidy on term loan up to 1% of EFCI p.a for 6 years
Net SGST Reimbursement
Category 1:
100% of Net SGST for 10 years, up to 7.5% of EFCI per annum.
Category 2:
90% of Net SGST for 10 years, up to 6.5% of EFCI per annum.
Category 3 & Municipal Corporation Areas:
80% of Net SGST for 10 years, up to 5% of EFCI per annum
Category 1:
100% of Net SGST for 10 years, up to 7.5% of EFCI per annum.
Category 2:
90% of Net SGST for 10 years, up to 6.5% of EFCI per annum.
Category 3 & Municipal Corporation Areas:
80% of Net SGST for 10 years, up to 5% of EFCI per annum
Electricity Charges
No electricity duty for 5 years.
No electricity duty for 5 years.
EPF Reimbursement
100% of the employer's statutory contribution - Ceiling incentive amount per employee will be 12% of the employee's basic salary, DA, and retaining allowance, or INR 1800 per month, whichever is lower.
100% of the employer's statutory contribution - Ceiling incentive amount per employee will be 12% of the employee's basic salary, DA, and retaining allowance, or INR 1800 per month, whichever is lower
Capital Subsidy (Micro Industries)
Capital subsidy for Micro Industries only.
N.A.
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
