Industrial policy and package scheme of incentives 2013


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Industrial policy and package scheme of incentives 2013

  1. 1. 5thMay 2013
  2. 2. PSI 2013Coverage – Eligible Industrial Units in Pvt., Co-op, Publicand Joint sector Industries in 1stSchedule of IDR Act 1951 Manufacturing enterprises under MSMED 2006 IT & BT manufacturing units Cold storages Mechanized Food/ Agro processing industries Dairy, Fruit and Vegetable Processing Grain Processing Fish Processing Packed foods Non alcoholic beverages from fruits & vegetables
  3. 3. Area ClassificationNagpur city – DAll other talukas of Nagpur Division exceptGadchiroli district – D+Gadchiroli – NIDNaxal affected talukas - Gadchiroli and Gondia – All talukas Chandrapur- Chandrapur, Gondpipri, Rajura, Korpana,Jiwati, Ballarsha, Pombhurna, Mul and Sawali Bhandara – Sakoli, Lakhandur and Lakhani
  4. 4. Important DefinitionsMega Projects – D, D+ Taluka - 250 Crs or 500 Direct employment Gadchiroli – 100 Crs or 250 Direct employment For employment based Mega Projects – Minimumemployment criterion to be achieved within 2 years formdate of commercial production and to be maintainedthroughout eligibility period. 75% local employment to be provided Investment in CPP not taken in to account for determiningstatus as Mega
  5. 5. Existing Unit:-A unit in production prior to 01.04.2013,orA unit which has been granted EC orhas availed any incentives (Ex St Duty)under earlier scheme, orA unit which has filed a validapplication under PSI 2007 on or before31.03.2013
  6. 6. New Unit :- A unit set up for the first time by anentity in any taluka where there is no Existing Unitset up by the same entity and satisfies followingconditions It is not an Existing Unit At least one of the effective step is completed on or after01.04.2013 It is not formed as a result of re- establishment, mere changeof ownership, constitution or revival of existing unit.
  7. 7. Expansion / Diversification :- Additional FCI on orafter 01.04.2013 for manufacture of same ordifferent products provided, Additional Investment should be more than 25% of GrossFCI of immediate previous year (Min FCI Rs 25 lakhs forMSME and Rs 5 Crs for others) and, Additional FCI should result in increase in capacity by atleast 25% and, Additional FCI should result in increase in employment byatleast 10% .
  8. 8. Effective Steps :- Effective possession of land/ shed/ gala by eligible unit( Physical possession along with registered deed with cleartitle. For MIDC land physical possession with A to L) Constitution - Registration in case of Firm/ Co/ Trust/Society EM, LOI for IT/BT, IEM for LSI, Mega
  9. 9. Fixed Assets :- Land /area in effective possession as required for the project. Cost of development of location Building – B/U area used by the unit including administrativebuilding, residential and industrial housing andaccommodation for all such facilities required formanufacturing process. P & M – Including tools & equipments required and used forworking of unit. Installation & pre operative expenses capitalized. Technical know-how fees Amt paid to MIDC/ MSEDCL for developing infrastructure
  10. 10. Gross FCI :- New fixed assets acquired and paid forprovided, Only new Fixed Assets as per project cost accepted based onappraisal of financial institution and acquired withinstipulated period. For self financed/ NBFC financed project appraisal fromSICOM/ Scheduled commercial bank is necessary. Second hand Imported fixed assets having residual life of atleast 10 years can be considered. Investment in intangible assets including pre- operativeexpenses, interest capitalized, tech know-how, deposits paidfor utility services up to max 10% of project cost.
  11. 11. Financial Incentives (Basket) for NewUnitsArea Ceiling as %of FCINo of YearsMSME LSI MSME LSID 70 40 10 7D+ 80 50 10 7NID 90 70 10 7NaxalAffected100 80 10 7
  12. 12. New MSME/LSI will be eligible for basket ofincentives (IPS, Interest S/S, Power tariff,Strengthening) as % of FCI. Food/ Agro processingunits get 10% higher incentive with one additionalyear of eligibility.Interest S/S :- (MSME) On Term Loan @effective rateof interest (after deducting penal/compound interest,interest receivable under any other scheme) max 5%.Further Interest S/S should not exceed power billduring that year.Power Tariff S/S :- (MSME) @ Rs 1/- PU for 3 years
  13. 13. Incentives for strengthening :- New & ExpansionMSME 5% S/S on capital equipment for Tech up- gradation max Rs25 lacs 75% S/S on expenses on quality certification max Rs 1 lacs 25% s/s on capital equipment for cleaner production max Rs5 lacs 75% s/s on expenses on patent registration max Rs 10 lacs fornational & Rs 20 lacs for international 75% s/s on cost incurred for credit rating max Rs 40,000/-
  14. 14. Incentives for strengthening :- New & ExpansionMSME and LSI 75% of cost of water audit max Rs 1 lacs 75% of cost of energy audit max Rs 2 lacs 50% cost of capital equipment for recycle/ conserve watermax 5 lacs 50% of cost of capital equipment for improving energyefficiency max Rs 5 lacs
  15. 15. IPS for MSMEArea IPSNaxal Affected Net VAT+CST+100% ITCNID Net VAT+CST+ 75% ITCVidarbha Net VAT+CST+65% ITC
  16. 16. IPS for LSIArea IPSNaxal Affected 100% VAT - ITC +CSTNID 90% VAT - ITC +CSTD+ 80% VAT - ITC +CSTD 70% VAT - ITC +CST
  17. 17. Electricity Duty Exemption :- New MSME and LSI for15 years for Vidarbha.Stamp Duty Exemption :- For New as well as forexpansion during investment period (Land & for Loanpurposes) (including assignment of lease rights inIndustrial areas) Notification of R&F Dept is awaited.
  18. 18. Incentives forExpansion/Diversification75% as applicable to new units.For eligibility period less than 1 year as applicable tonew unit.Electricity Duty exemption for 10 yearsStamp Duty exemption during investment period.
  19. 19. Annual Cap on Incentives duringEligibility PeriodIncentives will be disbursed equitably during entireeligibility period of the unit with a provision for carryforward. Total admissibility Rs 1000 for 10 years , unit will be disbursedmax Rs 100 every year Suppose annual basket during 1styear comes to Rs 150, Rs 100will be disbursed and Rs 50 will be carried forward in nextyear If during 2ndyear annual basket comes at Rs 75, total will be75+ 50 = 125, Rs 100 will be disbursed and Rs 25 will be carriedforward to 3rdyear
  20. 20. Application for ECOnly after completion of effective steps but not laterthan 31.03.2018Unit shall acquire and pay for the assets andcommence commercial production within investmentperiod.Delay in production and application will attractprorate reduction in incentives and eligibility period.Investment period will be from date of application orthe date suggested by the unit (within the schemeperiod) for MSME – 3 years For LSI – 4 years
  21. 21. Industrial Policy 2013Secondary Growth Corridor - Mumbai- Nashik-Aurangabad- Amravati- Nagpur Thrust on Food, Agro, Engineering, Electronics and supportservices like logistic and warehousingCritical Industrial Infrastructure Fund – Rs 500 Crsfor last mile infrastructure for MIDC areas. Exhibition cum Convention center at NagpurHelipads in major MIDC areasIncreased FSI in MIDC areas – Additional 0.5 withpremium.
  22. 22. Flatted galas in MIDC areas for MSME10% plot reservation for MSME, out of which 5% forwomen & BC category in New MIDC areasState Cluster development scheme for MSME – 70-80% grant on cost of P& M for CFCs up to Rs 5 Crs.State Mnf. Competiveness Program for MSME-Marketing, Skill Development, Lean manufacturing,Design assistanceModification of seed money scheme on line withPMEGP
  23. 23. Amnesty scheme for closed & unviable units-BTAL permission – Min land area reduced from 10 to5 Hect, Period for usage of land reduced from 15 to 5years.