Gujarat's new industrial policy pegs average annual outlay of Rs 8000 cr

Gujarat CM Rupani said that the new policy has been formed to further consolidate the growth momentum that the state has achieved over the past few years as well as enhance the current growth rate

Pegging the average annual outlay of upto Rs 8000 crore, the Gujarat government on Friday announced its New Industrial Policy 2020 that looks to breathe a fresh lease of life into the state's economy.
 

Making the announcement on Friday, Gujarat Chief Minister Vijay Rupani said that the new policy has been formed to further consolidate the growth momentum that the state has achieved over the past few years as well as enhance the current growth rate.
 

Apart from attracting fresh investments in the state from industries, the policy looks to create more jobs, boost value-addition, encourage adoption of new technology, increase productivity and create an ecosystem driven by innovation.
 

At a time when several industries in Gujarat have been struggling to avail land for the last two-three years, the new policy has opened up the arena through long term lease. Under the new policy, the state government will facilitate industries in availing government land on long-term lease of upto 50 years, extendable further according to the prevailing policy to industrial enterprises at 6 per cent of market rate.
 

As announced earlier, the Gujarat government's efforts to provide special incentives to global companies planning to relocate their operations to the state from other countries too, finds a mention in the new industrial policy.

"We had constituted 9 taskforce committees that held several rounds of serious and productive meetings. It helped us arrive at this new policy. The policy incorporates most of the suggestions indicated by the industry at large, keeping in mind the global and national manufacturing trends and sectors," Rupani added.
 

The other important aspects of the policy include incentives in terms of capital subsidy and tax incentives. For instance, Gujarat took de-linked incentives from state Goods & Services Tax (SGST).
 

Under the new policy, upto 12 per cent of fixed capital investment will be given to large industries for setting up manufacturing operations in the state in the form of capital subsidy. "Therefore, the incentive amount will now be more predictable and transparent and thus help industry in taking fast decisions," according to Rupani. Moreover, there will be no upper ceiling on the amount of incentive to be given to a unit.
 

In a boost to micro, small and medium enterprises (MSMEs), the new industrial policy provides 65 per cent of the total cost of acquiring a foreign technology for MSMEs with a ceiling of Rs 50 lakh. The MSMEs will also be eligible for capital subsidy of upto 25 per cent of the eligible loan amount of upto Rs 35 lakh, while they will be encouraged to install solar rooftop projects on the units with higher tariff for the solar power generated at Rs 2.25 per unit as against Rs 1.75 per unit.
 

Meanwhile, Gujarat government is also preparing a dedicated policy for the services sector. However, the new industrial policy offers an interest subsidy of up to 7 per cent for up to Rs 35 lakh per annum for a period of 7 years to service sector MSMEs in the areas of financial services, healthcare and environmental services, among others.