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Government approves Central Sector Scheme for Industrial Development of Jammu & Kashmir

J&K
January 9, 2021

The Government of India has formulated a New Industrial Development scheme for Jammu & Kashmir (J&K IDS, 2021) as the Central Sector Scheme for the development of Industries in the Union Territory of Jammu & Kashmir.

The main purpose of the scheme is to generate employment which directly leads to the socio-economic development of the area.

Considering the historic development of re-organization of Jammu & Kashmir with effect from 31.10.2019 into UT of Jammu & Kashmir under the J&K Re-organization Act, 2019, the present scheme is being implemented with the vision that industry and service led the development of J&K needs to be given a fresh thrust with emphasis on job creation, skill development and sustainable development by attracting new investment and nurturing the existing ones.

The following incentives would be available under the scheme:-
Capital Investment Incentive at the rate of 30% in Zone A and 50% in Zone B on the investment made in Plant & Machinery (in manufacturing) or construction of the building and other durable physical assets(in the service sector) is available. Units with investment upto Rs. 50 crore will be eligible to avail this incentive. The maximum limit of incentive is Rs 5 crore and Rs 7.5 crore in Zone A & Zone B respectively.

Capital Interest subvention: At the annual rate of 6% for a maximum of 7 years on loan amount up to Rs. 500 crore for investment in plant and machinery (in manufacturing) or construction of building and all other durable physical assets(in the service sector).

GST Linked Incentive: 300% of the eligible value of actual investment made in plant and machinery (in manufacturing) or construction in building and all other durable physical assets (in the service sector) for 10 years. The amount of incentive in a financial year will not exceed one tenth of the total eligible amount of incentive.

Working Capital Interest Incentive: All existing units at an annual rate of 5% for a maximum of 5 years. The maximum limit of incentive is Rs 1 crore.