Uttar Pradesh govt announces sops for GCCs and semiconductor plants

Uttar Pradesh unveils fresh incentives for GCCs and large semiconductor projects to boost FDI and advance its $1 trillion economy ambition

In pursuit of its $1 trillion economy goal, the Uttar Pradesh (UP) government is stepping up efforts to attract foreign direct investment (FDI) in the Global Capability Centres (GCC) and semiconductor plants.

 

To this end, the Yogi- Adityanath- led government has announced special incentives for semiconductor projects involving investments of ₹3,000 crore or more under the UP Semiconductor Policy 2024.

 

The state is also offering a wide range of incentives to attract GCC investments, including land subsidy, stamp duty exemption, capital subsidy, interest subsidy, operational expenditure subsidy, payroll subsidy, Employees' Provident Fund reimbursement, talent development incentives, R&D incentives. 

Under this roadmap, semiconductor plants will be eligible for interest subsidy, employee cost reimbursement, exemption in state goods and services tax (SGST) for a period of 10 years, 100 per cent Employees’ Provident Fund (EPF) reimbursement for UP domiciles (up to ₹2,000 per month), concessions in water charges, and electricity tariff relief of ₹2 per unit for a decade. 

According to UP finance and parliamentary affairs minister Suresh Khanna, the state cabinet has cleared the proposal for incentives on a case-to-case basis. He said semiconductor manufacturing is expanding rapidly in developed economies such as the United States, Europe, Japan and Taiwan, and Uttar Pradesh aims to align itself with this global trend

by positioning the state as a key hub for the emerging semiconductor industry.

 

Mukesh Bahadur Singh, chairman of the UP coordination committee of the Indo-American Chamber of Commerce, said the state is emerging as a potential semiconductor fabrication hub, and it will support India’s ambitions towards self-reliance while generating large-scale employment.

 

The state cabinet has also approved the Standard Operating Procedure (SOP) for the effective implementation of the UP GCC Policy 2024, designating the state’s apex industry interface, Invest UP, as the nodal agency.

 

UP industrial development minister Nand Gopal Gupta Nandi said that the state’s improving investment climate has drawn interest from top industrial groups and MNCs. “Our GCC Policy is highly beneficial, and now the SOP has been brought in to ensure its effective implementation,” he noted.

 

While UP’s GCC investment tally is rising, nearly 21 companies have proposed investments in the current financial year. Under this framework, a GCC will be a captive unit established by an Indian or foreign company, which will carry out strategic functions such as Information Technology, Research and Development, finance, human resources, design, engineering, analytics, and knowledge services.