No. 1 (10) / 2001 - NER
Government of India
Ministry of Commerce & Industry
(Department of Industrial Policy & Promotion)
1. The Hon''ble Prime Minister, during the visit to Uttarakhand from 29th to 31st March, 2002, had, inter-alia made an announcement that "Tax and Central Excise concessions to attract investments in the industrial sector will be worked out for the Special Category States including Uttarakhand. The industries eligible for such incentives will be environment friendly with potential for local employment generation and use of local resources."
2. In pursuance of the above announcement, discussion on Strategy and Action Plan for Development of Industries and generation of employment in the states of Uttarakhand and Himachal Pradesh were held with the various related Ministries/agencies on the issue, inter-alia, infrastructure, development, financial concessions and to provide easy market access, The new initiatives would provide the required incentives as well as an enabling environment for industrial development, improve availability of capital and increase market access to provide a fillip to the private investment in the state.
3. Accordingly, it has been decided to provide the following package of incentives for the states of Uttarakhand and Himachal Pradesh.
3.1 Fiscal Incentives to new Industrial Units and to existing units on their substantial expansion:
(i). New industrial units and existing industrial units on their substantial expansion as defined, set up in Growth Centres, Industrial Infrastructure Development Centres (IIDCs), Industrial Estates, Export Processing Zones, Theme Parks (Food Processing Parks, Software Technology Parks, etc.) as stated in Annexure-I and other areas as notified from time to time by the Central Government, are entitled to :
(a) 100% (hundred percent) outright excise duty exemption for a period of 10 years from the date of commencement of commercial production.
(b) 100% income tax exemption for initial period of five years and thereafter 30% for companies and 25% for other than companies for a further period of five years for the entire states of Uttarakhand and Himachal Pradesh from the date of commencement of commercial production.
(II) All New industries in the notified location would be eligible for capital investment subsidy @ 15% of their investment in plant & machinery, subject to a ceiling of Rs.30 Lakhs. The existing units will also be entitled to this subsidy on their substantial expansion, as defined.
(III) Thrust Sector Industries as mentioned in Annexure-II are entitled to similar concessions as mentioned in Para 3(I) & (II) above in the entire state of Uttarakhand and Himachal Pradesh without any area restrictions.
3.2 Development of Industrial Infrastructure:
(i) The funding pattern under the Growth Centre Scheme currently envisaging a Central assistance of Rs.10 Crores per centre is raised to Rs.15 crore per centre.
(ii) The financing pattern of Integrated Infrastructure Development Centres (IIDC) between Government of India and SIDBI will change from 2:3 to 4:1, and the GOI funds would be in the nature of a grant, so as to provide the required infrastructural support.
3.3 Other Incentives:
(i) Deen dayal Hathkargha Protsahan Yojna and other incentives of Ministry of Textiles: The funding pattern between Government of India and both the States would be changed from 50:50 to 90:10 under this Scheme. Ministry of Textiles would extend its package of incentives, as notified for North-Eastern States, to the states of Uttarakhand and Himachal Pradesh also.
(ii) Ministry of Food Processing Industries would include Uttarakhand in difficult areas category. The state of Himachal Pradesh is already included in the difficult areas category.
(iii) Pradhan Mantri Rozgar Yojana (PMRY) : Ministry of Agro & Rural Industries would provide for states of Himachal Pradesh and Uttarakhand relaxation under PMRY with respect to Age (i.e. 18-40 years from 18-35 years) and Subsidy ( @ 15% of the project cost subject to a ceiling of Rs.15,000/- per entrepreneur).
3.4 Ineligible Industries under the policy:
The list of industries excluded from the purview of proposed concessions is at Annexure-III.
In addition, the Doon Valley Notification (S.O.No. 102(E) dated 1st February, 1989 (Annexure-IV) as amended from time to time, issued by Ministry of Environment & Forests would continue to operate in the Doon Valley area and the industries notified under it are excluded from the proposed concessions, in the state of Uttarakhand.
3.5 Nodal Agency
The Nodal Agency for routing the subsidies/incentives under various schemes under this Policy will be notified seperately.
4. Government reserves the right to modify any part of the policy in the interest of public.
5. The Ministry of Finance & Company Affairs (Department of Revenue), Ministry of Agro & Rural Industries, Ministry of Textiles, Ministry of Food Processing Industries, Ministry of Small Scale Industries, etc. are requested to amend Act/rules/notifications, etc. and issue necessary instructions for giving effect to these decisions.
Joint Secretary to the Govt of India