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Understanding the Gujarat Industrial Policy 2020 (Part-2/4): Capital subsidies to large investments

Gujarat Industrial Policy

The Gujarat Industrial Policy identifies thrust sectors and core sectors, that the state considers a priority in terms of investment and manufacturing. Investors in sectors shall receive focus and special incentives should they choose to manufacture products that fall under them: 

Thrust Sectors

Core Sectors

Sunrise Sectors

  • Electrical Machinery and Equipment
  • Industrial Machinery and Equipment
  • Auto and Auto Components
    Ceramics
  • Technical Textiles
  • Agro and Food Processing
  • Pharmaceuticals & Medical Devices
    Gems & Jewellery
  • Chemicals (in designated area)
  • Industry 4.0 Manufacturing
    Electric Vehicles and Components
    Waste Management Projects
  • Green Energy (Solar & Wind Equipment)
  • Eco-friendly compostable material (substitutes to traditional plastics)
  • 100% export-oriented units, irrespective of sector

Secondly, talukas (or potential areas of investment) have been categorized into three categories. Capital subsidies to large investments will be awarded on the basis of which area the company chooses to invest in. The three categories are as follows: 

Category 1: Backward Districts
Should the company choose to manufacture in districts/talukas that have been identified as industrially backward, the investor shall receive a subsidy of 12% for thrust sectors and 10% in general sectors on eligible Fixed Capital Investment, excluding land. 

Category 2: Developing Districts 
Should the company choose to manufacture in districts/talukas that have been identified as industrially backward, the investor shall receive a subsidy of 10% for thrust sectors and 8% for general sectors on eligible Fixed Capital Investment, excluding land. 

Category 3: Mature Districts 
Should the company choose to manufacture in districts/talukas that have been identified as industrially backward, the investor shall receive a subsidy of 10% for thrust sectors and 8% on general sectors for on eligible Fixed Capital Investment, excluding land. 

However, all the units will continue getting an Electricity Duty Exemption for 5 years. 

Gujarat’s new industrial policy can be found here: Gujarat Industrial Policy 2020

Read ‘Gujarat Industrial Policy 2020: Key Features and Incentives’ here

For more information on Gujarat’s new industrial policy, please reach out to: 

Drushti Joshi 
Team Gujarat @InvestIndia
Email: Drushti.joshi@investindia.org.in 
 

Read Part 1: Key features and incentives here
Read Part 3: Subsidies and incentives for MSMEs and Startups here
Read Part 4: Industrial infrastructure in Gujarat here