The Uttar Poorva Transformative Industrialization Scheme (UNNATI) 2024 is an ambitious initiative by the Government of India aimed at boosting industrial development in the North-Eastern region. Among the various incentives provided under this scheme, the Capital Interest Subvention (CIS) stands out as a crucial financial support mechanism. This blog post will explore the details of the CIS, including eligibility criteria, benefits, the application process for registration, and the claim process, with a special focus on how businesses in Assam can take advantage of this subsidy.
Table of Contents
- Understanding Capital Interest Subvention (CIS)
- Eligibility Criteria
- Benefits of Capital Interest Subvention (CIS)
- Application Process for Registration
- Claim Process for CIS
- Conclusion
Understanding Capital Interest Subvention (CIS)
The Capital Interest Subvention (CIS) under UNNATI 2024 is a financial incentive aimed at reducing the interest burden on term loans taken by eligible industrial units for investment in plant and machinery (for the manufacturing sector) or building and other durable physical assets (for the service sector). This incentive is designed to make borrowing more affordable, thus encouraging industrial expansion and new investments in the North-Eastern states, including Assam.
Eligibility Criteria
To qualify for the Capital Interest Subvention (CIS), industrial units must meet specific eligibility criteria. These criteria ensure that the benefits are directed towards genuinely deserving businesses that can contribute significantly to the region’s industrial ecosystem.
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New and Expanding Units
- New Units: Industrial units registered under the scheme on or after 09.03.2024 but not later than 30.09.2026. Such units must commence commercial production within four years from the date of grant of registration.
- Expanding Units: Existing units undertaking substantial expansion with an additional investment of at least 25% of the total amount of investment already made in plant and machinery or construction of building and other durable physical assets.
Geographical Location
- Units located in both Zone A (Industrially Advanced Districts) and Zone B (Industrially Backward Districts) within the North-Eastern Region are eligible. This includes several districts in Assam.
Loan Eligibility
- The term loan must be taken from Scheduled Commercial Banks or Financial Institutions registered with the Reserve Bank of India (RBI).
- Interest subvention is applicable on loans up to a principal amount of Rs. 250 crore.
Benefits of Capital Interest Subvention (CIS)
The CIS offers substantial financial relief by reducing the interest burden on term loans. The benefits vary based on the geographical location of the unit:
Zone A (Industrially Advanced Districts)
- Eligible units can avail of Capital Interest Subvention at an annual interest rate of 3% for a maximum of seven consecutive years from any date after the application for registration under this scheme. However, the disbursement of the eligible amount under this incentive shall begin only after the commencement of commercial production.
Zone B (Industrially Backward Districts)
- Eligible units can avail of Capital Interest Subvention at an annual interest rate of 5% for a maximum of seven consecutive years from any date after the application for registration under this scheme. However, the disbursement of the eligible amount under this incentive shall begin only after the commencement of commercial production.
Application Process for Registration
Applying for the Capital Interest Subvention (CIS) involves several steps to ensure that only genuinely deserving units receive the benefits. Here is a step-by-step guide to the application process:
Online Registration
- Units must register through the online portal (unnati.dpiit.gov.in) using the prescribed forms.
Document Submission
- Detailed Project Report (DPR)
- Land documents (ownership/rent/lease deed)
- Appraisal report from a bank or NEDFi
- Certificate of incorporation
- GSTIN certificate
- Udyam Registration/Entrepreneurs Memorandum I
- Any other required documents
Field Verification
- A designated field visit team will inspect the unit to verify the existence and installation of plant and machinery or construction of buildings and durable physical assets.
Approval Process
- The application will be processed and recommended by the District Industry Centre (DIC) and subsequently reviewed by the Secretary-Level Committee at the state level.
- Finally, the Department for Promotion of Industry and Internal Trade (DPIIT) will grant approval and issue the registration certificate.
Registration Certificate
- DPIIT will issue registration certificates to the approved industrial units through the online portal.
Claim Process for CIS
Once the unit is registered and the necessary investments are made, the next step is to claim the Capital Interest Subvention. The claim process is as follows:
Intimation of Commercial Production/Operation
- Units must intimate the actual date of commercial production/operation along with supporting documents through the portal within 30 days of the date of commercial production.
Submission of Claim
- The claims for Capital Interest Subvention (CIS) must be submitted online for a complete financial year within six months from the end of the financial year for which the claim is made. Required documents include:
- Certificate of proof of Date of Production/Commencement of Operation approved by the GM of the concerned DIC (only with the first claim, if not uploaded before).
- Bank certificate cum recommendation letter from the lending institution/scheduled commercial bank which has financed the cost of P&M (Building cost to be included in case of micro industries) installed in the unit and cost of building and other durable physical assets in the service sector.
- Bank Certificate regarding utilization of funds for the purpose for which they were sanctioned and that there is no diversion of funds for other purposes.
- Audited balance sheet, if applicable.
- Detailed bank statement for the claim period.
- Latest Electricity Bill Receipt/document proving the functionality of the unit.
- Undertaking from the applicant that the unit has not availed of a similar incentive from any other State/Government of India departments.
Field Verification and Report
- A designated field visit team will inspect the unit to verify the physical existence of plant and machinery or building and other durable physical assets and production/operation undertaken by the unit.
- The team will submit a field visit report online through the portal.
Approval by Secretary-Level Committee
- The DIC will process the case and forward it to the Director (I&C Department) of the concerned State Government, specifying the eligible incentive amount.
- The Secretary-Level Committee will review and approve the claims, which are then forwarded to DPIIT for final approval.
Disbursement of Incentive
- Upon approval by DPIIT, the incentive amount will be disbursed through the North-Eastern Development Financial Corporation Ltd. (NEDFi) directly to the unit’s bank account.
Conclusion
The Capital Interest Subvention (CIS) under the UNNATI 2024 scheme offers significant financial relief for businesses in the North-Eastern region, particularly in Assam, by reducing the interest burden on term loans. This incentive aims to make borrowing more affordable, encouraging new investments and industrial expansion. Businesses looking to leverage this incentive should carefully review the eligibility criteria, prepare the necessary documentation, and ensure timely application to maximize their benefits.
For more detailed information and assistance with the application process, businesses can visit the official UNNATI 2024 page on our website or contact us.