Benefits for Manufacturing MSME units under Gujarat Industrial Policy

Introduction: –

Situated on the west coast of India, Gujarat is one of the leading industrialized states in the country. Its geographical area of about 2 Lakhs sq. km. accounts for 6% percent of the total area of India. With a coastline of 1600 km, it’s well connected to all the major ports In all continents and countries.

Gujarat, with only 5 per cent of the national population, contributes 7.3 per cent to the national GDP. Gujarat has witnessed 13% growth in GDP at current prices in 2019-20 over the previous year. Gujarat has been constantly achieving a double-digit growth rate. In the last 5 years, the state registered an average growth rate of 10.14% at a constant price.

New Gujarat Industrial Policy, 2020. :-

Gujarat Industrial Policy 2015 has come to an end as on 31st December 2019. It was further extended up to the date of release of the new policy or 31st December 2020 whichever is earlier.

The Government of Gujarat has released the new Gujarat Industrial Policy, 2020 on August 07, 2020, which shall have an operative period of five years that is till August 6, 2025.

The new Gujarat Industrial Policy 2020 has been formed to further consolidate this momentum and enhance the current growth rate.

Objectives: –

• Supporting jobs
• value addition across sectors
• adoption of state-of-the-art technology
• increase productivity with Industry 4.0 manufacturing
• innovation-driven ecosystem with a focus on research and development so as to propel the state further towards “Atmanirbhar Gujarat”
• the shaping of a Modern Gujarat that spearheads the vision of a Modern India.

Under GIP,2020 The government has introduced various schemes for Thrust sectors, MSMEs, Startups, Sick Industries, Reallocation Incentives, Balanced regional Development, Research and Innovation, sustainable manufacturing, etc.

Assistance to the MSMEs:-

The definition of MSME is the same as the revised definition given by the central government of India.

The MSMEs can have two types of registered units under UDYAM registration that is manufacturing and service units. Micro, Small, and Medium Enterprises contribute nearly 30% percent of the country’s GDP, nearly 45 percent of the manufacturing output. They provide nearly 11 crore jobs. They are the nurseries for entrepreneurship and innovation. They are widely dispersed across the country and produce a diverse range of products to meet the needs of the local markets, the global market, and the national and international value chains. So, to boost the manufacturing sector in India the Government of India Launched various schemes

Benefits/Schemes for Manufacturing Units of MSMEs:-

(1) Capital Subsidy:-

Quantum of Capital Investment Subsidy:

(2) Interest Subsidy-

GIP,2015 – Interest Subsidy of 5% with the maximum amount 25 Lakhs p.a. for a period of 5 years in Municipal Corporations areas. Interest Subsidy of 7% with the maximum amount 30 Lakhs p.a. for a period of 5 years in areas other than Municipal Corporations area.

GIP, 2020 –

Only new MSME of Service sector will be eligible for Interest Subsidy on term Loan on new machinery, equipment, and furniture/fixture (except land and building).

* 1% Additional Subsidy to registered Startups. & 1% additional subsidy to young entrepreneurs below the age of 35.

(3) Assistance for Quality certification: –

ERP Assistance: –      65% of cost of Installation max. Rs. 1,00,000 

Quality Certification: –        50% of fees payable to certification for national/ International certification (i.e., BIS/Hallmark/ISI etc..) and 50% of testing equipment max Rs. 10,00,000.

(4) Financial support for ZED Certification: –

50% of total charges for ZED Certification max RS. 50,000.

(5) Assistance in implementation of Information and Communication Technology (ICT):

The equipment required for use of ICT as a media of communication, networking with hardware for accessing cloud computing shall be eligible for 65% of the capital expenditure related to ICT facilities, maximum up to Rs. 5,00,000.

(6) Assistance for the acquisition of Technology:

The scheme will be provided by way of 65% of the cost, in GIP 2015 the limit was 50% of the cost, payable subject to a maximum of Rs. 50 lakhs.

Enterprise Shall obtain prior approval of MSME Commissionerate within one year after signing of MOU/agreement/contract with a technology provider.

(7) Assistance for Patent Registration:

75% of the cost incurred for any number of patent applications subject to maximum of 25 lakhs. 

(8) Assistance for saving in consumption of energy and water:

• 75% cost of energy/water audit max. 50000
• 25% of the cost of equipment, which minimizes the consumption by at least 10%, Up to 200000.

(9) Assistance for raising capital through SME Exchange:

Earlier in GIP 2015, it was 20% of expenditure which is now in GIP,2020 increased to 25% of the expenditure incurred on raising funds through SME exchange up to 5 Lakhs.

(10) Assistance for re-imbursement of CGTMSE Fees: –

100% of annual service fees for the period of 5 Years.

(11) Assistance for Power connection charges: –

@35% of charges paid to Distribution licenses for new/ Additional Load connection, Max 50,000 Rs.

(12) Assistance for Rent: –

@ 65% of rent paid by enterprise, Max. 1,00,000 Rs.

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For any queries, pls. connect on msme@rmpsco.com or rajnikant@rmpsco.com

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