DIPP issues North East Industrial Development Scheme (NEIDS)
In a recent notification dated 12th April, 2018, the Department of Industrial Policy and Promotion, Ministry of Commerce and Industry (“Department”) has introduced a scheme for investors in the North Eastern Region (i.e. the states of Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim and Tripura) of India. The scheme is named as “North East Industrial Development Scheme” (“NEIDS”).
This scheme is expected to boost the process of industrialization in the North-Eastern Region of India. The NEIDS scheme is effective from 01/04/2017 to 31/03/2022i.e. for a period of 5 years.
All new industries in manufacturing sector and service sector unless specified is falling under the purview of this scheme. The NEIDS scheme will not apply to the industries specified in the Annexure – I to this notification. The maximum cap for availing incentives, subsidies and discounts is kept as Rs. 200 Crores.
The Department through this scheme has given various subsidies and discounts to all the industries as specified above, interested to invest in the North-Eastern Region of India.
The key highlights of the NEIDS Scheme:
- There will be an empowered committee, which will review the applications of industries, which are willing to avail the benefits under this NEIDS scheme.
- All industrial units as specified will be provided Central Capital Investment Incentive for access to credit @ 30% of the investment in plant and machinery subject to a maximum cap of Rs. 5 Crore.
- All eligible industries will be given an interest incentive @3% on working capital credit advance by Scheduled Banks or Central/State Financial Institutions for the initial 5 years computed from the date of commencement.
- All eligible industries will be entitled to receive 100% reimbursement on the amount spent on premium of insurance paid by the industry on plant, machinery subject to maximum limit of 5 years.
- All eligible industries will be entitled receive reimbursement on Goods and Services Tax (“GST”) paid on finished goods manufactured in all such industrial units located in the region as specified above for the period of 5 years from the date of commencement of such industry.
- All eligible industries can claim reimbursement under this scheme from central share of Income Tax for the first 5 years from the date of commencement.
- All eligible industries will be entitled to several transport and employment benefits under the scheme.
- All such industries/units are needed to be mandatorily be registered with the Department.
- A nodal agency is appointed under this scheme namely North East Industrial Development Finance Corporation Ltd. (NEDFi). Further the claims for Capital Investment Incentive and Transport Incentive shall be scrutinize by independent audit agencies.
- Several rights of the Centre/State Government/Financial Institutions have been enumerated under this scheme.
- There are two Annexures attached with this notification. Annexure – I is a negative list, which states what all industries are not eligible under this scheme and Annexure – II is comprised of the following items;
- Components to be included for computing the value of Plant and Machinery under CCIIAC in the manufacturing sector.
- Components which will not be considered for computing the value of Plant & Machinery under CCIIAC in the manufacturing sector.
iii. Admissibility of erection and installation charges in the manufacturing sector.
Please refer to the hyperlinked source below for further details.