Aatmanirbhar Gujarat Scheme for assistance to MSMEs: Assistance of Capital Investment Subsidy to Micro enterprises

Aatmanirbhar Gujarat Scheme for assistance to MSMEs: Assistance of Capital Investment Subsidy to Micro enterprises gives micro businesses in Gujarat a one-time cash subsidy on their term loans. Depending on the taluka category, this support can go up to 25% of the loan amount, with a maximum of ₹35,00,000.

This scheme is still open for eligible micro-enterprises. It is run by the Industries and Mines Department of the Gujarat government and is part of the wider Aatmanirbhar Gujarat effort to build a self-reliant industrial base in the state.

Aatmanirbhar Gujarat Scheme for assistance to MSMEs: Assistance of Capital Investment Subsidy to Micro enterprises

The Aatmanirbhar Gujarat Scheme for MSMEs is an umbrella scheme launched by the Industries and Mines Department to help the state's micro, small and medium enterprises. These businesses support local jobs, GDP growth and exports. The component called Assistance of Capital Investment Subsidy to Micro enterprises offers a capital investment subsidy to manufacturing units so they can lower the cost of setting up or expanding their business.

The scheme is operative for five years, from October 5, 2022, to October 4, 2027. Any unit that starts commercial production during this window and meets the conditions can apply. The subsidy amount is worked out on the lower of the Gross Fixed Capital Investment (GFCI) in the project or the cost appraised by the bank.

This support is a big help for small manufacturers who want to buy machinery, build premises and raise their production capacity without carrying the full capital burden on their own. It also encourages new units to grow in less developed talukas, where the incentive is higher.

Highlights

Benefits

The subsidy is paid as a percentage of the term loan amount, and the rate depends on the category of the taluka where the unit is located. Talukas that are less developed get a higher incentive so that industry spreads beyond the main cities.

For example, if a micro enterprise is set up in a Category 1 taluka and takes a term loan of ₹10,00,000, the owner could receive a subsidy of ₹2,50,000. This money is paid only after the unit starts commercial production.

Eligibility

To apply for this support, the enterprise has to meet the following conditions:

1. The unit should be a registered Micro, Small or Medium enterprise.
2. It should hold a valid acknowledgment or registration from the Ministry of MSME or DPIIT.
3. The business should be a new manufacturing unit or an existing one going through expansion or diversification.
4. Commercial production should have started between October 5, 2022, and October 4, 2027.
5. The application should be submitted online within one year of the first loan disbursement, the start of commercial production, or the date of the Government Resolution, whichever is later.

Exclusions

Some businesses will not be able to claim this benefit. The main points to check are given below.

• If the same fixed capital investment has already been given an incentive under another state level scheme, the unit is not eligible unless it is specifically allowed.
• If the application is filed more than one year after the relevant dates, such as loan disbursement or start of production, it will not be considered.
• If the term loan was sanctioned more than one year after commercial production began, the unit cannot claim the subsidy.

Note: Some costs are not counted as eligible capital expenditure. These include land and land development, working capital, goodwill, royalty, preliminary and pre-operative expenses, second-hand indigenous plant and machinery, interest that is capitalised, power generation unless it is for captive use, and rented or leased property.

Application Process

Applications are filed online through the Investor Facilitation Portal (IFP) of the Gujarat government. The process has two parts, registration first and then the actual application.

STEP 1 - Visit the Investor Facilitation Portal (IFP) and click on New Investor Registration to open the registration form.

STEP 2 - Fill in the registration form with the correct details and click on Submit. A confirmation link will be sent to the registered email address.

STEP 3 - Verify the email using the link to complete the registration. After this, the account is ready to use.

STEP 4 - Log in to the Investor Facilitation Portal (IFP) with the email and password used during registration.

STEP 5 - Enter the required project details and upload all the mandatory documents about the business to finish the application. If there is any problem, the Helpdesk Portal can be contacted for support.

Documents

Keep the following documents ready before starting the application so that the process goes smoothly:

1. Signed application form with the enterprise stamp and the authorised person's details.
2. Copy of the Udyam Registration or Udyog Aadhaar acknowledgment.
3. Copy of the term loan sanction letter and bank certification of the first disbursement.
4. Proof of the business constitution, such as a registered partnership deed.
5. Copy of the Detailed Project Report (DPR), or a bank appraisal report for projects above ₹5 crore.
6. GST registration and PAN card of the enterprise.
7. Copy of the latest ITR showing the plant and machinery value.
8. Birth certificate or school leaving certificate for entrepreneurs under 35 years.
9. Caste certificate or certificate for differently abled persons, if applicable.
10. Land documents such as 7/12 Utara, Namuna 6, index or property card, and NA permission where needed.
11. Notarized rent or lease deed with the owner's proof of ownership if the property is not owned.
12. Board resolution for authorised signatories in the case of partnerships, LLPs or companies.
13. CA certificate verifying the Gross Fixed Capital Investment.

Definitions

Micro, Small and Medium Enterprise

An enterprise is grouped based on its investment in plant and machinery:

New Enterprise: A unit that begins commercial production within the scheme period and keeps separate accounts.

Existing Enterprise: An MSME that was already in production before starting an expansion or diversification plan.

Gross Fixed Capital Investment (GFCI): The total investment in buildings, machinery, utilities and support tools, excluding the cost of land.

References

Official Guidelines 1 | Official Guidelines 2 | Apply Online | Required Document Checklist

FAQ's

What is the purpose of this scheme?

This scheme supports micro and small manufacturing units in Gujarat by giving a capital investment subsidy, which lowers the cost of setting up or expanding a business.

Who can apply?

New manufacturing units or existing enterprises going through expansion in Gujarat are eligible, provided they register and start production between October 5, 2022, and October 4, 2027.

How much subsidy will I receive?

The subsidy is between 10% and 25% of the term loan depending on the taluka category, up to a maximum limit ranging from ₹10,00,000 to ₹35,00,000.

When should I apply?

The application should be filed online within one year of the first loan disbursement, the start of production, or the date of the Government Resolution, whichever is the latest.

Are my rental expenses covered?

No, spending on leased or rented property is not counted as part of the eligible fixed capital investment.

Can I combine this with other subsidies?

Yes, but the total support taken from state and central government sources together should not exceed the total loan amount disbursed by the bank.