AI SummaryIncentive Scheme for MSMEs in Powerloom Sector: Interest Subsidy on Term Loan helps micro, small, and medium enterprises in West Bengal by providing a subsidy on annual interest liabilities for term loans taken for approved powerloom projects. This scheme aims to boost the production of high-quality fabrics and support local entrepreneurs in the textile industry through financial relief.
Scheme has been closed or it was a one time scheme which has been closed by the government.
Incentive Scheme for MSMEs in Powerloom Sector: Interest Subsidy on Term Loan - Introduction
Incentive Scheme for MSMEs in Powerloom Sector: Interest Subsidy on Term Loan is a key support initiative offered by the department of micro, small & medium enterprises and textiles, government of west bengal. This scheme helps eligible businesses reduce their financial burden by providing subsidies on annual interest payments for term loans taken from authorized banks or financial institutions for approved projects.
This initiative acts as a sub-scheme under the broader Incentive Scheme for MSMEs in Powerloom Sector. It launched on 1st January, 2022, and remains active until 31st December, 2024.
The primary goal of this scheme is to encourage the installation of new-age shuttleless powerlooms. by doing so, the government aims to improve fabric quality, promote sustainable growth in the textile sector, maximize resource usage, and generate new employment opportunities across the state.
Key Information
| Scheme Name | Incentive Scheme for MSMEs in Powerloom Sector: Interest Subsidy on Term Loan |
| Level | State |
| Scheme target | Infra |
| State | West Bengal |
| Category | Business & Entrepreneurship |
| Target beneficiaries | Business entities, government organizations, joint liability groups, NGOs, registered societies, self-help groups, and trusts |
| Benefit type | Cash subsidy |
| Nodal department | Micro, Small & Medium Enterprises and Textiles Department |
| Start date | 01-01-2022 |
Benefits
Eligible enterprises can receive significant interest subsidies based on their unit size and geographical zone for a period of 5 years.
| Category | Zone A & B | Zone C, D & E |
|---|---|---|
| Micro & Small Enterprise | 55% of interest liability | 70% of interest liability |
For Medium Enterprises located in Zones B, C, D, and E, the government provides a subsidy of 25% of the total term loan interest paid, subject to a maximum ceiling of ₹ 1,75,00,000 per year.
You should note that this subsidy is payable annually. to claim it, you must submit a statement or certificate (as per Annexure-II) from your lending institution, confirming you have paid the interest on time without any defaults.
Eligibility
To benefit from this scheme, you must meet the following criteria:
- your enterprise must be a micro, small, or medium enterprise (MSME) operating within the powerloom sector.
- your unit must have started commercial production between 01.01.2022 and 31.12.2024.
- you should have signed a four-party agreement involving the directorate of textiles, the financial institution, and Tantuja.
- your organization may belong to the private, cooperative, or joint sector, including state-managed undertakings or industrial self-help groups.
- your project must be supported by a detailed feasibility report and must receive official approval from a commercial bank, state financial institution, or recognized central financial institution.
Exclusions
You are not eligible for this interest subsidy if:
- you have already received an eligibility certificate or disbursement of incentives under any other relevant state incentive scheme for the same purpose.
- you have commenced production before 31.12.2021 and are already claiming benefits under another state scheme.
Application Process
If you wish to apply, you should submit your application offline after your production begins. You must use the prescribed Form-A2 and include all necessary supporting documents. Please submit your application to the directorate of textiles within 12 months from your date of commercial production.
Address for submission:
Directorate of Textiles, Handlooms, Spinning Mills, Silk Weaving & Handloom Based Handicrafts Division, New Secretariat Buildings, 1, K. S. Roy Road, 5th Floor, 'B' Block, Kolkata 700001.
Documents
Please ensure you have the following documents ready for your application:
- authenticated copies of your memorandum of association, articles of association, or partnership deed.
- a list detailing the names and addresses of all directors, partners, owners, or group members.
- your approved project report.
- loan sanction and disbursement letters from your bank.
- the signed four-party agreement.
- audited balance sheets for the last 2 years.
- record of existing manufacturing activities and annual production capacity in West Bengal.
- land deeds, lease agreements, or rent receipts.
- mutation and conversion certificates for land or building.
- a valid 'consent to operate' certificate from the West Bengal Pollution Control Board (WBPCB).
- GST registration documents and trade licenses.
- first electricity bill.
- Udyam registration acknowledgement.
- SC/ST certificates if applicable.
- self-declaration and bank certificate as per official guidelines.
Definitions
The zones are defined based on the geographical classification of municipal areas and districts within West Bengal to determine the subsidy levels. for specific details on each area, please consult the official scheme guidelines provided by the department.
References
Read the full official guidelines here.
FAQ's
What areas are classified under Zone A for determining incentives?
Zone A includes the Kolkata Municipal Corporation area and all municipal areas within North 24-Parganas, South 24-Parganas, and Howrah.
Which districts fall under Zone B?
Zone B includes districts such as Hooghly, portions of North and South 24-Parganas, and various municipal corporations across Paschim Medinipur, Purba Medinipur, and Bardhaman.
What is the primary eligibility criteria?
The scheme generally covers MSMEs in the powerloom sector that began production on or after 1st January 2022 and have a valid four-party agreement with the government and financial partners.
How does the department handle physical inspections?
Upon receiving your application, the directorate of textiles conducts a physical inspection, typically within 15 days, to verify the new-age shuttleless looms and your fixed capital investment.
What is an approved project?
An approved project is one that has received technical approval from the directorate of textiles and financial approval from your lending institution.
What if my application is rejected?
If you do not meet the scheme requirements, the directorate of textiles will send you a formal letter explaining the rejection of your application.