Scheme of Financial Assistance to IHMs/FCIs/IITTM/ICI/NCHMCT/PSUs

Scheme of Financial Assistance to IHMs/FCIs/IITTM/ICI/NCHMCT/PSUs provides central grants to institutions in the tourism and hospitality sector for infrastructure development, including constructing new campuses, upgrading equipment, and establishing training centers. It supports registered societies in expanding capacity and maintaining educational standards through targeted capital funding. For the financial year 2025-26, the budget provision for this scheme stands at ₹35 crore, and around ₹30.41 crore was allocated to institutes during 2024-25.

This is a continuing scheme of the Ministry of Tourism. It helps set up, expand, and modernize institutes like IHMs, FCIs, IITTM, ICI, and NCHMCT, so tourism education in India stays modern and competitive. Whether an applicant represents a state society or a central institution, this scheme offers the required backing for infrastructure and skill-based development.

Scheme of Financial Assistance to IHMs/FCIs/IITTM/ICI/NCHMCT/PSUs - Introduction

This scheme serves as a key support system by the Ministry of Tourism to build capacity within the hospitality sector. It supports the establishment of new institutes like IHMs, FCIs, and centers for IITTM, ICI, and NCHMCT. Beyond new setups, it assists existing institutions in expanding their footprint through building alterations and equipment modernization.

The funds are used for setting up new institutes, upgrading infrastructure such as construction of hostels, modernization of laboratories, and purchasing equipment, furniture, and computers. The objective is to make these institutes capable of producing the manpower needed by the tourism and hospitality industry, both in quantity and quality.

Key Information

Benefits

Financial support under this scheme is structured into specific ceilings for different institutional needs. For instance, creating a new State Institute of Hotel Management (SIHM) attracts a maximum assistance of ₹12,50,00,000.

An applicant may adjust inter-component spending by up to 10% before project sanction. Following approval, an initial ₹10,00,000 is released for preparatory activities. Subsequent tranches are released based on tender completion and progress, with the final portion reserved until the submission of a completion certificate.

Fund release and use

Funds under this scheme are managed through a Central Nodal Agency (CNA). The release follows a phased pattern: the first tranche of 40% is given after land transfer, society registration, and other required due diligence. The next tranches of 40% and 15% are released upon submission of the utilization certificate and progress report. The final 5% is released only after project completion and submission of all documentation, including the completion certificate and display of credit.

An applicant society must furnish a valid utilization certificate for at least 75% of the previous grant to receive further installments. Implementing agencies have to open zero-balance accounts in SBI, and the drawing limit and fund release are linked to real-time use of funds. Any unspent balance must be deposited back into the CNA account. An online management information system is also being developed to track the projects.

Eligibility

To benefit from this scheme, an organization should be a society registered under the Societies Registration Act 1860, formed by the central, state, or union territory government. Common examples include autonomous bodies like IITTM, NCHMCT, or ICI.

For establishing a new SIHM, the state government must transfer at least 5 acres of developed, encumbrance-free land to the society. In hilly areas or specific metropolitan cities like Mumbai or Bengaluru, this requirement is relaxed to 2 acres. Basic utilities such as water, electricity, and sewerage must be guaranteed by the state administration. If a facility is planned in an existing building, the building must be deemed suitable by the appropriate assessment council.

Application Process

The application process is offline and follows a structured approach. Each step is explained below.

STEP 1 - Registration: Form the institute as a society under the Societies Registration Act 1860 and secure the land title in the society's name.

STEP 2 - Submitting the DPR: Draft a detailed project report (DPR) adhering to NCHMCT guidelines and submit it to the Ministry of Tourism alongside land records.

STEP 3 - Implementation: Once sanctioned, establish a project construction committee and sign a formal agreement with an executing agency like the CPWD to start construction.

Documents

Applicants should prepare the following documents for their application:

• Detailed Project Report (DPR).
• Society registration certificate under the Societies Registration Act 1860.
• Official land transfer documents showing the society as the titleholder.
• An undertaking to follow standard NCHMCT admission and academic norms.
• A building suitability certificate from the NCHMCT for existing building conversions.
• Board-approved cost estimates for any new components or alterations.

References

Read the full revised official guidelines here.

Check the official PIB release on the scheme.

Check the PIB budget update for 2025-26.

FAQ's

If a state government intends to upgrade an existing Food Craft Institute into a State Institute of Hotel Management, what mandatory administrative steps must be taken regarding the existing society structure?

The original Food Craft Institute society must be dissolved and a new one formed, registered specifically as a State Institute of Hotel Management under the Societies Registration Act 1860.

What is the minimum acceptable area of developed land, free from all encumbrances, that a state government must transfer for setting up a new Institute of Hotel Management?

The state must transfer at least 5 acres of developed land to the society.

What necessary documentation concerning property ownership must accompany the initial proposal when seeking assistance to set up a new Institute of Hotel Management?

Land transfer documents verifying that the developed land is registered in the name of the Institute of Hotel Management society must be included.

If difficulties arise in officially transferring the required land to the society, what must the applicant government provide to the central government to proceed with the proposal?

The reasons for the difficulty must be documented in writing and presented to the central government for review and approval.

What specific legal requirements must a governmental body or administration meet to qualify its society for financial assistance under these guidelines?

The society must have been formed by a central, state, or local government entity and must hold a valid registration under the Societies Registration Act 1860.

When applying for the establishment of a new Food Craft Institute by a state government or union territory, what is the mandatory minimum acreage requirement for the developed land?

At least 3 acres of developed, encumbrance-free land must be transferred to the Food Craft Institute society.

If a Central Institute of Hotel Management wishes to construct an Applied Training Centre, what is the minimum land prerequisite for the proposal to be considered for funding?

The institute must already possess 2 acres of surplus land or ensure the state government provides the necessary additional plot.

Are there special considerations for receiving financial assistance if a State Institute of Hotel Management is housed within a pre-existing building?

Yes, aid can be received provided the building is verified as suitable by the National Council for Hotel Management & Catering Technology.

What is the minimum required size for developed land when setting up a new Food Craft Institute in hilly areas or metropolitan Urban Agglomerations?

In hilly regions or the six major metropolitan hubs, a minimum of 1 acre of developed land is sufficient.

When proposing a new center for institutions like the Indian Culinary Institute, what minimum land size must the state government commit to providing?

The state government must transfer at least 5 acres of encumbrance-free, developed land.

What specific administrative action must be finalized before the central government can begin considering financial assistance for a new Institute of Hotel Management?

The Institute of Hotel Management society must be officially registered under the Societies Registration Act 1860.

If physical land transfer to the society is legally restricted, what alternative documentation is acceptable?

Records showing clear land demarcation for the institute may be provided, provided the land remains in the possession of the state's tourism department.