Gujarat Textile Policy: Interest Subsidy (Fiscal Incentives to Labour Intensive Unit)
At a Glance
Scheme Category
Business & Entrepreneurship,Setting up / start-up / entrepreneurship
Target Beneficiaries
Business Entity,Industries
Brief Description
The "Gujarat Textile Policy" introduced by the Industries and Mines Department aims to create a vibrant Textile Sector ecosystem and generate enormous employment opportunities in the State.
Benefit Type
Cash
Eligibility Criteria
1. The industrial unit must be recognized as a Labour Intensive Unit. 1. Industrial units must have taken a sanctioned term loan for Gross Fixed Capital Investment. 1. The loan disbursement date must be on or after 01/01/2024 for units under implementation as of 01/10/2024. 1. The unit must apply within one year from the Date of Commercial Production (DoCP). 1. The unit must be in regular repayment of installments and interest. 1. The unit must bear at least 2% interest on the term loan. <br> > Eligible Activities: Activity 1: - Garments, Apparel & Made-ups, Technical Textiles Activity (including Composite Unit) Activity 2: - Weaving (with or without preparatory), Knitting, Dyeing & Processing, Texturising, Twisting, Embroidery and MMF Spinning to manufacture yarn from Polyester Staple Fiber (PSF) / Viscose Staple Fiber (VSF) (excluding Spinning activity of Cotton and Synthetic Filament Yarn). > Labour Intensive Unit: Labour Intensive Unit means a new industrial unit that provides minimum employment to 4000 (four thousand) persons duly registered under EPF scheme, out of which minimum female employee should be at least 1000 (one thousand). The existing unit that carrying out expansion/diversification of activities , during the operative period of the scheme and provides totally new employment to minimum 4000 (four thousand) persons duly registered under EPF scheme, out of which minimum female employee should be at least 1000 (one thousand).
Application Mode
Offline
Application Process
> Application for Registration: Step 1: The application has to be made to the Industries Commissioner in the <nis:link nis:type=webUrl nis:id=slugId nis:text="prescribed format" nis:value=https://ic.gujarat.gov.in/documents/commondoc/2025/GTP%202024%20Registration%20Form.pdf nis:enabled=true/> along with the following documents within one year from loan disbursement, production start, or policy operative date (whichever is later). Step 2: On receipt of the application and after the scrutiny and verification of relevant documents as per the procedure prescribed, registration certificate will be issued by the Industrial Commissioner. <br> > Application for Provisional/Final Eligibility Certificate: Application for Industrial Unit: - MSME Units having GFCI up to INR 10 Crore: After DoCP, the Industrial Unit shall submit an application to the General Manager, District Industries Center. - MSME Units having GFCI above INR 10 Crore and up to 50 Crore: After DoCP, the Industrial Unit shall submit an application to MSME Commissioner for Provisional Eligibility Certificate within 1 year from DoCP or within one year from the date of issuance of this GR, whichever is later. - Other than MSME Units: After DoCP, the Industrial Unit, having registration shall submit an application for Provisional Eligibility Certificate to the Industries Commissioner within 1 year from DoCP or within 1 year from the date of issuance of the registration certificate, whichever is later. <br> Contact Us: > <nis:link nis:type=webUrl nis:id=slugId nis:text="Industries Commissionerate" nis:value=https://ic.gujarat.gov.in/ic-contact.aspx nis:enabled=true/> > <nis:link nis:type=webUrl nis:id=slugId nis:text="District Industries Center" nis:value=https://ic.gujarat.gov.in/dic-contact.aspx nis:enabled=true/>
Required Documents
- Document of registration of the industrial undertaking, as applicable under law, and the Industrial Entrepreneur Memorandum, as prescribed by the Government of India. Documents related to legal possession of land with valid non-agriculture permission for industrial use, and registered purchase / Lease / Rent deed. If the plot or shed is in GIDC estate, a copy of the possession letter should be attached. Consent to Establish from GPCB, if applicable. Detailed Project Report containing the following: Executive summary Background Details of existing business (in case of expansion) Land/Shed details Raw material procurement strategy Manpower details Techno-economic viability assessment Financial analysis Term loan sanction letter from financial institution(s) Board Resolution / Authority Letter / PoA PAN Card of Enterprise and Authorized Person GST Registration with all Annexures First Sale Bill ( In case of Commercial Production is commenced) Audit Report (Before initiation of Expansion)
FAQs
What is the "Gujarat Textile Policy"?
The "Gujarat Textile Policy" is a government initiative aimed at strengthening the textile sector by promoting investment, sustainability, employment generation, and value chain integration.
What is the operative period of the "Gujarat Textile Policy"?
The operative period of the Gujarat Textile Policy 2024 is from October 1, 2024, to September 30, 2029, covering a span of five years.
How does the policy contribute to employment generation?
The policy focuses on creating a robust textile ecosystem by attracting investments, encouraging MSMEs, supporting women entrepreneurs, and expanding production capacities, thereby generating employment opportunities.
What incentives are provided under the policy?
The policy offers financial assistance, infrastructure support, and subsidies to strengthen textile manufacturing, encourage investment, and support MSMEs, startups, and large enterprises.
What is the objective of the "Interest Subsidy (Fiscal Incentives to Labour Intensive Unit)" component?
The component is a financial assistance program that provides credit-linked interest subsidies to eligible industrial units to reduce their loan repayment burden.
Who is eligible to apply for this subsidy?
Labour Intensive Units that have taken a sanctioned term loan for Gross Fixed Capital Investment and meet the eligibility criteria specified in the scheme are eligible to apply for the subsidy.
How much subsidy is provided under this scheme?
7% of the interest on the term loan is provided under this scheme.
For how many years can an industrial unit avail of the subsidy?
An industrial unit can avail of the interest subsidy for a period of 8 years, depending on its category and location.
When should an industrial unit apply for the Interest Subsidy?
The industrial unit must apply within one year from the Date of Commercial Production (DoCP). after obtaining the Eligibility Certificate.
What happens if an industrial unit defaults on loan repayment?
If an industrial unit defaults on loan repayment, it will not be eligible to receive the subsidy for the default period, and that period will be deducted from the total eligible subsidy duration.
Does the Interest Subsidy cover penal interest or additional bank charges?
No, the subsidy is provided only on regular interest payments and installments paid to the financial institution. Penal interest and additional charges are not covered.
Can an industrial unit avail of interest subsidies from both the State and Central Government?
Yes, an industrial unit can avail of subsidies from both governments; however, the total subsidy amount will be adjusted to ensure that the unit bears at least 2% interest on the term loan.
Is proof of loan repayment required for claiming the subsidy?
Yes, the industrial unit must submit proof of regular installment and interest payments to the financial institution in order to claim the subsidy.
If an industrial unit has multiple term loans, which disbursement date will be considered for eligibility?
If multiple term loans are availed from different financial institutions, the first disbursement date from any one financial institution will be considered for determining the subsidy eligibility.