Dear Readers,
I hope you are doing well.
Recently, Chief Minister Bhupendra Patel unveiled new “IT/ITES Policy 2022-27” which would replace the IT & ITeS policy, 2016-2021, which offers both capital and operational support to Information Technology (IT) firms making investments in Gujarat for existing and expansion units. The objectives of new policy are to create high skilled, industry-ready IT talent pool; provide a state-of-the-art IT Infrastructure; develop a unique and simplified incentive scheme; establish a robust cloud ecosystem in the State and foster research & development in new and emerging technologies such as Artificial Intelligence, Machine Learning, Quantum computing, Blockchain, etc. The operative period of the new policy will start from the day of notification to 31st March 2027.
Major Benefits available for IT Industry:
- The new policy introduced a unique concept of a CAPEX-OPEX model, which envisions CAPEX support of 25% up to 50 crore for normal projects and Rs 200 crore for mega projects.
- Under the OPEX model, the government will provide support of 15% up to Rs 20 crore per year for normal projects and Rs 40 crore per year for mega projects.
- The new policy offers an employment generation incentive (EGI) up to Rs 60,000 per employee and up to 100% reimbursement of employer’s EPF contribution through Atmanirbhar Gujarat Rojgar Sahay.
- 100% reimbursement of electricity duty will be offered to all eligible IT and ITeS units.
- Incentivising the development of IT cities/townships with CAPEX support up to Rs 100 crore and relaxations in regulatory & FCI norms.
- Eligible IT/ITeS units will be entitled to Interest subsidy at the rate of 7% on term loan or actual interest paid whichever is lower with the ceiling of INR 1 crore per annum for 5 years.
- Financial support up to Rs 50,000 per person through direct benefit transfer (DBT) to the graduate students and working professionals for skill development programmes, enhancing awareness of IT.
- Rental subsidy up to INR 10,000 per month per seat under Government facilitated infrastructure & empanelment model.
- R&D institutes can avail one-time CAPEX support up to INR 5 Cr.
- Government shall support the developer of Data centre projects by CAPEX support up to INR 150 Cr and power tariff subsidy.
- Eligible IT/ITeS units can avail EGI and Atmanirbhar Gujarat Rojgar Sahay for all such employees working from home.
- The Gujarat AI School or the Gujarat AI Centre of Excellence will be set up in association with the IT industry, IITs, IIITs and other renowned national and international research institutions with the focus for upskilling efforts by offering courses in emerging technologies.
- Government also provides non-fiscal incentives to the eligible IT/ITeS units like facilitate the allotment of land for eligible projects, provide Investor facilitation desk on 24×7 Basis
The State Government will play a proactive role in promoting vibrant IT/ITeS industry in Gujarat, by providing above incentives to eligible IT/ITeS units / parks, in addition to any incentives that they might be entitled to avail from Government of India.
For detailed understanding regarding the incentives to be availed under this new policy, you may refer our below presentation for your immediate reference.
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Published on: March 1, 2022