In view of major transformation of industrial environment globally and within the country, Government of Uttar Pradesh has approved and announced Infrastructure and Industrial Investment Policy-2012 with an objective of attaining the target of 11.2 per cent industrial growth in Uttar Pradesh.
A.Main features of new policy are as below:
Fiscal support to Infrastructure
Under Infrastructure interest subsidy scheme, if industrial units take loan for developing infrastructure facilities for self-use, such as- road, sewer, water drainage, power line etc., then they will get reimbursement at the rate of 5 per cent on interest rate of loan taken for this purpose, maximum upto Rs. 1 crore for a period of 5 years
Reimbursement of 25% of stamp duty, if a private developer completes development of industrial estate or area within 3 years after purchase of land and a minimum of 50% land is sold
Exemption from land transfer fee, sub-divisional charges, and levy charges to such manufacturing units that make available their additional land for industrial purpose after 5 years to any other company or agency in which they have at least 51% equity
Reimbursement of stamp duty on land transfer to such subsidiary company which starts production within 3 years of the said land transfer from its parent company having 51% share in it.
Other Fiscal incentives
100 % exemption on Stamp Duty on purchase, lease or acquisition of land by industrial units proposed to be set up in Eastern U.P., Central U.P. and Bundelkhand region
100% exemption on stamp duty to new IT, Bio-tech, BPO, Food processing, Food park, Alternative energy resources
100% exemption on stamp duty to private sector infrastructure development excluding PPP projects
75% exemption on stamp duty to other units on government land & 50% exemption on stamp duty on private land
In case of attachment of assets of a closed unit by UPFC, PICUP or bank, stamp duty shall be payable on sale price fixed by competent authority instead of circle rate
Facility of input tax refund or set-off will be allowed to manufacturers who export outside India by sale to export houses in the course of export under sub-sec.(3) of Sec. 5 of Central Sales Tax Act 1956
Exemption from Electricity Duty for 10 years to new industrial units and 15 years to Pioneer units and to captive power generation for self consumption by unit.
Investment Promotion Scheme
Eligibility criteria to avail incentives has been brought down from Rs 10 crore to Rs 5 crore for industrial units set up in Poorvanchal, Madhyanchal, Bundelkhand and all food processing units, live stock based units & IT units while, it has been reduced to Rs 12.5 crore from Rs 25 crore for the rest of State
Interest-free loan equivalent to VAT and Central Sales Tax paid by industrial units or 10 percent of the annual turnover whichever is less will be provided for a period of 10 years repayable after 7 years from the date of first disbursement
New Capital interest subsidy scheme
Industrial units to be set up in Poorvanchal, Madhyanchal and Bundelkhand shall get reimbursement at the rate of 5 per cent on interest rate of loan taken for plant and machinery, maximum upto Rs 50 lakhs per annum for a period of 5 years.
Textile units to be set up in Poorvanchal, Madhyanchal and Bundelkhand, shall get reimbursement at the rate of 5 per cent on interest rate of loan taken for plant and machinery, maximum upto Rs 100 lakhs per annum for a period of 5 years while this facility is available in the tune of maximum upto Rs 50 lakhs per annum in the other region of the state.
Industrial quality development subsidy scheme
Reimbursement will be provided to the industrial association, group of industrial units at the rate of 5 per cent on interest rate of loan taken for establishing testing labs, quality certification lab, tool-rooms, etc. maximum upto Rs 1 crore for a period of 5 years
EPF reimbursement scheme
To generate new employment opportunities, this scheme includes provision of reimbursement of 50 per cent of EPF contribution for their workers for a period of 3 years by new units after 3 years from the date of establishment of the units, if the new units give employment to 100 or more unskilled workers
Special facilities for Mega Projects
Mega projects with the investment Rs 200 to 1000 crores and Super Mega Projects with the investment more than 1000 crores will be provided with special incentives on case-to-case basis and priority shall be given for development of infrastructure facility.
Industrial Entrepreneur Memorandum [IEMs]/ Letter of Intent [LOIs]
B.The total number of IEMs/LOIs filed in the State during Eleventh Five Year Plan period from the year 2007-08 till 2011-12 were 888 involving investment of Rs.84140.33 crores and employment of 391508 persons.
C.During 2012-13, 139 IEMs/LOIs filed with the proposed investment of Rs. 15023.16 Crs., during 2013-14, 153 IEMs/LOIs filed with the proposed investment of Rs. 12579.62 Crs., during 2014-15, 95 IEMs/LOIs filed with the proposed investment of Rs. 11769.50 Crs. & during 2015-16, 125 IEMs/LOIs filed with the proposed investment of Rs. 11421.51 Crs.
No. of total IEM+LOI
(Rs. in Crs.)
Employment Potential (in Nos.)
12th Plan (Up to March. 2016)
Source: DIPP, GOI
D.Details of capital investment and employment generation in the State during the 11th plan and 12th plan (Upto March 16) in Heavy Industries Sector are as under:-
E.During the 12th five year plan, the state Government is on the way to develop world class infrastructural facilities in the State. Several expressways and state highways in road sector, thermal power projects in energy sector and airport in aviation sector are the major areas where the investment is proposed through PPP mode. Some of the projects under these areas have already been initiated in the 11th five year plan and some of them will take the final shape in the 12th Five Year Plan.
F.The six policies, viz. Infrastructure & Industrial Investment Promotion Policy, Information Technology, Food Processing, Solar energy, Sugar industry, co-generation and distillery promotion, and encouraging policy for developing large poultry farms were unveiled by the Hon’ble Chief Minister as a policy package.
G.In order to promote investment and to project the State as an attractive destination for investment, Government of Uttar Pradesh has strengthened Udyog Bandhu. Investment Promotion Cell has been constituted with an aim to facilitate investors and to play its vital role in attracting more Industrial Capital Investment into the State. Government has charted out and proposed a long term plan for conducting Domestic Road Shows, International Road Shows and Global Investor Summit.
Pradeshiya Industrial & Investment Corporation of Uttar Pradesh Limited (PICUP)
H.PICUP was established in the year 1972 as a Company of State Govt. under company’s act 1956. The authorised share capital of the Corporation is Rs. 150 crore and paid up capital is Rs. 135.57 crore. The main objective of the Corporation has been to provide financial assistance by way of extending long term loan to large scale & medium scale industrial ventures in the role of industrial development institute so as to encourage industrial development of the state. PICUP has also been acting as an agent to Govt. of UP for execution of various Govt. schemes.
I.PICUP has sanctioned term loan of Rs. 1435.00 crore to 1100 industrial units and a sum of Rs. 1420.00 crore has been disbursed out of which a sum of Rs. 1204.00 crore has been received back by PICUP as on 31.03.16 from 874 assisted units. Effective steps are being taken for recovery of balance outstanding dues of Rs. 211.00 crore as principal from the remaining 214 assisted units. PICUP has also financed 17 industrial units in association with industrial groups viz. Tata, Birla, Goenka, Bhartiyas etc. in the Joint/Assisted Sector by way of equity and term loan assistance.
J.PICUP has decided not to sanction any fresh term loan since the year 2002 till its financial position becomes sound and presently the Corporation is concentrating its efforts for recovery of loan and reduction of NPAs . Presently PICUP is operating One Time Settlement Scheme (OTS) for settlement of its outstanding dues and is also is acting as an agent to State Govt. to execute and operate following schemes under which eligible industrial units are being provided interest free loan and interest subsidy:-
K.Under this scheme, there is a provision to provide interest free loan as per prescribed norms of the schemes against Commercial Tax (VAT & CST) deposited by the new Mega Industrial Units with capital investment of Rs. 10.00 crores and above in Bundelkhand and Poorvanchal Region and with capital investment of Rs. 25.00 crores and more in other distts. of the State. Besides it, units pertaining to electronic sector with new capital investment of Rs.10 Crore and above, and pertaining to Food Processing and Live Stock with new capital investment of Rs.5 Crores or and above are also eligible under the scheme.
Industrial Investment Promotion Scheme – 2012
L.Under this Scheme, the new and expansion of units having made new/additional capital investment of Rs.5.00 Crores or more in Poorvanchal, Madhyanchal and Bundelkhand regions or the new/expansion units pertaining to Food Processing or Live Stock and Information Technology are eligible for interest free loan for 10 years against the VAT/CST deposited by them towards annual turn over of manufacturing goods. Except the above region and sectors, all the new/ expansion units having made investment of Rs.12.50 crore.
Capital Interest Subsidy Scheme-2012
M.New Industrial units set up/ and the units which have undertaken expansion or diversifications in Poorvanchal (Eastern U.P.), Madhyanchal (Central U.P.) and Bundelkhand, will for a maximum period of five years be reimbursed the amount of interest at the rate of 5% payable on loan taken by them for procurement of new plant & machinery from Banks/Financial Institutions. The maximum limit of the same will be Rs.50 lakhs per unit.
N.Besides it, for new textile units like spinning, weaving, knitting and garments manufacturing units and the textile units gone into expansion or diversification, the maximum limit of same will be Rs.1 Crore per unit in Poorvanchal (Eastern U.P.), Madhyanchal (Central U.P.) and Bundelkhand, and in other regions of the state it will be Rs.50 lakhs.
Infrastructure Interest Subsidy Scheme
O.New / expansion /diversification Industrial units, being set up in the state, will for a maximum period of 5 years be reimbursed the amount of interest at the rate of 5% payable on loan taken by them for developing infrastructural amenities for self use like roads, sewere, water drainage, erection of power line, transformer and power feeder. The maximum limit of the same will be Rs.1 crore per unit.
P.PICUP has been provided its services to State Govt. and other Govt. departments / agencies / undertakings as consultant / advisor for financial and technical bid process management. In the past PICUP has provided its services for disinvestments of Sugar Mills, Selection of Developers of Ganga Express Way Project, Transport Deptt. Animal Husbandry, UP DASP, LIDA, SUDA, ADA & Horticulture Deptt. etc. PICUP has been nominated by GoUP as Nodal Agency for preparation of terms and conditions of tender documents for selection of consultants for various project under PPP.
Uttar Pradesh Financial Corporation (UPFC)
Q.Schemes operated by UPFC to encourage capital investment & Industrialization in the state are :
R.Industrial Investment Promotion Scheme was launched by the State Govt. for providing interest free loan to Mega Industrial Units to meet out the short fall in Working Capital in the initial years of production due to making large capital investment. Under the scheme, Interest Free Loan shall be provided to Mega Industrial Unit having capital investment of Rs. 10.00 Crore and above in Food processing and live stock sector (subsequently reduced to Rs.5.00 crore in the year 2006) or units which are being set up in Eastern and Bundelkhand Regions of the State irrespective of the sector and above Rs. 25.00 Crore in any industrial sector in other parts of the State. Under the scheme the interest free loan is provided to eligible Mega units for a period of 10 years (15 years for Pioneer unit) and repayment period is 7 years (10 years for Pioneer unit).
Audyogik Nivesh Protsahan Yojana-2012
S.UPFC has been nominated as an operating agency for sanction of interest free loan under the scheme to the units (i) who have made capital investment of Rs.5.00 crore to 10.00 crore in food processing, live stock and information technology sectors in any districts of the state, and (ii) who have made capital investment of Rs.5.00 crore to 10.00 crore in any sector other than food processing, live stock and information technology in districts of Eastern U.P., Bundelkhand and Madhyanchal and Rs.12.50 crore to 25.00 crore in districts other than districts of Eastern U.P., Bundelkhand and Madhyanchal. Under the scheme units making investment as mentioned above are also eligible for interest free loan for expansion. For units other than above categories PICUP will be the Operating Agency. .
T.The salient features of the scheme are as under:-
The scheme shall be effective from 04/09/2012.
Capital Investment means investment made in fixed assets/additional fixed assets i.e. land, building, plant & machinery and other capital assets and date of 1st sale of goods manufactured from this investment is on or after 04/09/2012.
The amount of interest free loan granted shall be 10% of the Annual Turnover of manufactured goods from the investment made as mentioned above or to the extent of the amount of CST & UP Vat paid on turnover as mentioned above during the financial year which ever is lower.
The loan shall be granted for 10 years on yearly basis from the date of 1st sale. The loan shall be repaid in lump sum after 7 years from the date of disbursement. In case of default, the unit shall have to make the payment of default interest @ 1.25% per month simple interest for the period of default.
Audyogik Gunvatta Vikas Upadan Yojana-2012
U.Under the Scheme, Interest Subsidy to the extent of 5% on the interest rate applicable & paid during financial year by a unit to a Financial Institution for the loan taken for the purchase of plant and machinery and equipments, establishment of testing lab, quality certification Lab for tool room shall be provided. This interest subsidy will be available for the 05 years (from the date of issuing of G.O.) with the condition that during entire period of this scheme maximum Rs.100.00 lacs will be reimbursed and counting of 05 years will be made from the date of Ist disbursement of loan by the Financial Institution to the unit with respect to aforesaid purpose. For obtaining the benefit under the scheme, company, organization/special purpose vehicle have to get sanctioned term loan from the Financial Institution and get disbursement from them for the said purpose and thereafter company, organization/ special purpose vehicle will submit their application to operating agency UPFC at its H.O. or Regional Office.
V.Under the scheme benefit will be provided to only those company organizations are special purpose vehicle which have not obtained any benefit from the State Govt. under any other scheme for setting up testing lab quality certification lab or tool room.
Poonjigat Byaj Upadan Yojna 2012
W.U.P. Financial Corporation has been nominated as an operating agency for sanction of Interest Subsidy under the scheme to the new units who have made investment upto Rs. 10.00 crore in Plant & Machinery and the unit is being set up in Districts of Bundelkhand, Poorvanchal and Madhyanchal. The units of Textile Sector – viz – Spinning, weaving, knitting and garments manufacturing, being set up in all Districts are eligible under the scheme. The salient features of the scheme are as under :-
New industrial units who have purchased Plant & machinery and started commercial production after 30.11.2012 and units undertaking expansion/diversification are eligible.
Under the scheme, interest subsidy on the term loan availed on Plant & machinery from scheduled bank/financial institutions controlled by Central Govt./State Govt. shall be given. The units should have availed term loan on Plant & machinery after 30.11.2012 and should have paid the interest due in financial year to the concerned financial institution.
The scheme shall be applicable in all Districts of the State for units of Textile Sector – viz – spinning, weaving, knitting and garments manufacturing. For other than these industries, the scheme shall be applicable in districts of Bundelkhand, Pooranchal and Madhyanchal.
The amount of interest subsidy shall be @ 5% on the interest paid during a financial year of Rs. 50.00 la, whichever is lower, per unit for a maximum period of 5 years. If the interest rate being paid by the unit is less than 5%, actual amount paid as interest shall be considered for subsidy. For the units of Textile Sector being set up in Bundelkhand, Poorvanchal and Madhyanchal, the maximum limit shall be Rs. 1.00 crore per unit per year. The calculation of time period of 5 years shall be done from the date of Ist disbursement of loan.
The period of scheme is 5 years i.e. only those units who have availed term loan for Plant & machinery within 5 years from the date of G.O. i.e. 30.11.2012 and have started commercial production within 3 years from the date of Ist disbursement of term loan are eligible.
Avasthapna Byaj Upadan Yojana-2012
X.UPFC has been nominated as an operating agency for sanction of interest subsidy under the scheme to the new units or company/ society / special purpose vehicle promoted by group of industries or association for installation of infra structural facilities for there own use like road, sewer, effluent treatment plant, drainage system, power line, transformer and installation of power feeder. Under the scheme Interest subsidy @ 5% for a maximum period of 05 years, total amount not exceeding to Rs.100.00 lacs is payable in all districts of the State.
Y.Under this scheme only those new industrial units or company/ society / special purpose vehicle promoted by group of industries or association would be eligible for interest subsidy who have availed term loan from financial institutions/scheduled banks for installation of infrastructure facilities as mentioned above, with in 5 years from the date of G.O. i.e. 30/11/2012. Further the unit should have started its commercial production with in 3 years from the 1st disbursement of the loan to the unit.
Z.Further if unit become defaulter in any payment of principal & interest, no subsidy shall be payable on interest paid on that instalment however this period shall be included in total eligibility period of 5 years.
AA.The amount of interest subsidy @ 5% on the interest paid during the financial year by a unit against the loan taken to establish infrastructure facilities as mentioned above. This interest subsidy will be available for a maximum period of 5 years with the condition that during the entire period of this scheme maximum Rs. 100.00 lakh will be reimbursed and counting of 5 years shall be done from the 1st disbursement of the loan.
AB.If the interest rate being paid by the unit is less than 5%, actual interest paid as interest shall be considered for subsidy. The maximum period of subsidy payable shall be 5 years. The unit shall have to deposit Administrative charges @ 2% of subsidy amount each year before disbursement of interest subsidy.
Uttar Pradesh Expressways Industrial Development Authority (UPEIDA)
AC.UPEIDA is currently implementing Two Greenfield Expressway Projects in Engineering, Procurement & Construction (EPC) mode entrusted to it by GoUP as under:-
AD.UPEIDA is implementing the “Agra to Lucknow Access Controlled Expressway (Greenfield) Project”, in Engineering, Procurement and Construction (EPC) Mode. The Project is the top most priority project of GoUP. This Expressway Project is planned to be completed in a record time of 22 months.
Salient details of “Agra to Lucknow Access Controlled Expressway(Greenfield) Project”
The Access Controlled Expressway Project is 302.22 Kms in Length and the expected journey time from Agra to Lucknow will be approx. 4 hours against around 7-8 hours at present.
The Expressway will pass through Agra, Firozabad, Mainpuri, Etawah, Auraiyya, Kannauj, Kanpur Nagar, Unnao, Hardoi and Lucknow.
The starting point of the Expressway shall be on Proposed Agra Ring Road, Village EtmadpurMadra, District Agra and the end Point of the Expressway shall be Mohan Road, Village SarosaBharosa, DistrictLucknow.
The selection of Contractors for all the Five Packages of the Expressway Project has been done. The details of the Five Packages of the Expressway Project are as follows:-
Name of Package
Name of Contractor
Estimated Cost of Construction (Rs. in crores)
Agra to Firozabad (Village Gurha)
M/s PNC Infratech Ltd.
Firozabad (Village Gurha ) to Etawah (Village Moonj)
M/s AfconsInfrasructure Ltd.
Etawah (Village Moonj) to Kannauj (Village Narmau)
M/s NCC Ltd.
Kannauj ( Village Narmau) to Unnao (Village Newal)