The state’s pro-business policies, industry-friendly environment, and focus on local employment have made Punjab a preferred destination for investors.
Invest Punjab: The Punjab government has attracted investments worth Rs 86,000 crore since March 2022 under the leadership of Chief Minister Bhagwant Mann. It has also created nearly 3.92 lakh job opportunities for the youth of the state.
Here are some ‘key achievements’ of the Punjab government:
- Rs 86,000 crore investment in just 30 months.
- 3.92 lakh jobs for the local youth.
- Major companies like Tata Steel and Sanatan Textiles are investing in Punjab.
- Focus on local employment as a key condition for investors.
- Peace, infrastructure, and a skilled workforce driving growth.
Financial incentives of the Punjab government:
The state of Punjab offers maximum support and financial incentives to the industry with 100 per cent exemption and reimbursement from Change of Land Use (CLU) and External Development Charges (EDC) charges.
The state government also provides the following exemptions:
1. 100% exemption from property tax for 10 years.
2. 100% exemption or reimbursement from stamp duty on purchase or lease of land and building.
3. 100% exemption from electricity duty for 10 years.
4. Investment subsidy by way of reimbursement of net SGST on intra-state sales: 100% of net SGST for 10 years with a cap of 125% of FCI.
The state’s pro-business policies, industry-friendly environment, and focus on local employment have made Punjab a preferred destination for investors. This positive trend is poised to continue, driving economic growth and prosperity for the state. Punjab reiterates its firm commitment of the state government to boost its industrial growth and bring up new ideas and innovations.
Fiscal incentives for ‘startup units’:
1. Interest subsidy: Eligible startups shall be provided an interest subsidy of 8% per annum for a period of 5 years on the rate of interest paid on loans obtained from scheduled banks or financial institutions, subject to the maximum limit of Rs 5 lakh per annum.
2. Lease rental subsidy: Reimbursement of 25% of lease rental subsidy to eligible startup units established in the state, operating from incubators, IT Parks, industrial clusters, or any other notified location shall be eligible for a period of 1 year, subject to the ceiling of Rs 3 lakh per annum.
3. Seed Funding: A seed grant of up to Rs 3 lakh per start-up shall be provided for validation of ideas, prototype development, assistance towards travelling costs and carrying out field or market research, skill training, marketing, and initial activities to set up a start-up, etc. Seed funding to startups would be routed through state or Centre-recognised incubators.
4. Scale-up Funding: The government would create a corpus fund of Rs 100 crore dedicatedly for category I funding to meet the funding requirement for the scalability of startups. The salient features of the fund are as follows:
• It will have an initial corpus of Rs 100 crore to be invested for 5 years as the Alternative Investment Fund (AIF).
• The fund would not invest directly in the startups but shall participate with capital commitment in SEBI-registered Category 1 AIF Venture Funds.
• SIDBI would be a professional fund manager for managing this fund and would empower their empanelled VCs to fund Punjab-based startups.
• The mandate would be given by the state government to make a 10% contribution to the total corpus of the VC Fund, subject to the condition that VC invests twice the amount contributed by the state government in the startups based in Punjab. The proportionate return or proceeds from the venture funds shall be remitted back to the FoF. These returns, along with capital gains, shall be used to continue to fund venture funds to continuously support a rapidly growing start-up ecosystem.
• The state government in total would contribute 10% of the funds’ size to be raised by VC, and it shall be released only when the VC makes an investment in Punjab-based startups.
Multiple-sector investment
Investments have been made across multiple sectors, including Agriculture and Food Processing, Manufacturing, Automotive and Auto Components, Chemicals and Petrochemicals, Textiles and Apparel, and Infrastructure. Investments have come from various countries and regions, notably Switzerland, the United States, Japan, and Germany.
The five districts that have received the highest levels of investment are SAS Nagar, with an investment of around Rs 24,930 crore, followed by Ludhiana at Rs 18,860 crore, Amritsar at Rs 5,805 crore, Patiala at Rs 5,190 crore, and Fatehgarh Sahib at Rs 4,981 crore.
These investments are thoughtfully allocated across multiple sectors, with Rs 30,651 crore earmarked for real estate, housing, and infrastructure; Rs 7,811 crore for manufacturing; Rs 6,567 crore for the alloy steel and steel industries; Rs 5,754 crore for textiles and apparel; and Rs 7,721 crore for agriculture, food processing, and beverages.
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