Investment Incentives

Investment Incentives as under the Industrial Policy (1997)

I) Scheme for the Motivation of Scheduled Castes, Tribes and Women entrepreneurs to start industries

• Rent Subsidy
  
  Rent subsidy is eligible for a period of five years from the date of commencement of commercial production subject to a ceiling of US$108.376 per month.
  (a) for the first two years - 50% of the rent
  (b) for the third year - 40% of the rent
  (c) for the fourth & fifth - 25% of the rent.
  
  
• Interest Subsidy
  
  With reference to loans received towards the creation of fixed assets and working capital, an interest rate equal to the difference between the actual rate charged by the financial institution/bank and a concessional rate of interest of 5.5 per cent per annum for five years shall be admissible from the date of Commencement of commercial production. However, the maximum amount of subsidy to each industry shall not exceed US$ 433.543 in any financial year.
  
  
• Special Investment Subsidy
  
  A special investment subsidy at the rate of 25 per cent on the capital investment for land, building and plant & machinery is admissible subject to a maximum of US$ 54,201.03 is offered.

II) Incentives for the Promotion of IT industry

• Capital Investment Subsidy
  • Applicable to New IT industries for the investments made on Plant and Machinery at 20 per cent to a maximum of US$43,360.73
• Connectivity Incentive
  • The industrial unit that have availed loan towards the creation of fixed assets and working capital, can avail an interest incentive to an extent of 25% of the annual interest amount paid, for five years from the date of commencement of business.
  • The maximum amount of subsidy to each industry shall not exceed US$1625.56 in any financial year
• Employment Incentive
  • The Unit needs to fulfil the criterion its permanent registration by providing at least 60 per cent employment to the local youth of Pondicherry.
  • Wage / Employment subsidy of 20 per cent Wage/Salary in case of such workers who are covered under Provident Fund (PF) will be granted.

III) Incentives for the Promotion of Thrust Areas

The government has proposed to provide capital Investment Subsidy for the following Thrust areas, with a view to attract more investments.

• Under the scheme a separate package of incentives are granted to the units provided they fulfil the criterion laid down during the permanent registration of Industrial units providing at least 60% of the employment to the local youth of Pondicherry.
• The Director of Industries and Commerce, Pondicherry has now submitted a proposal for the grant of investment subsidy for the other thrust area industries and requested for approval for implementation of the scheme prepared for the said purpose

Investment Incentives in the Tourism Sector

• An interest subsidy equal to difference of 5% in the rate of interest charged by Financial Institutions for loans for a period of 5 years, subject to a maximum of US$ 10852.54 per year.
• An investment subsidy of 20% of the total investment subject to a maximum of US$ 43,360.73 per project.
• Registration charges on Land and Building purchase will be refunded in full, two years after commencement of commercial activity.
• Town Planning Charges levied by the Town Planning Authorities for approving the building plans etc.
• Exemption from Luxury Tax on hotels is guaranteed for 7 years from the
  date of commercial opening, in case the Government brings in luxury tax
  for the 3 to 5 star category.
• Tourism Infrastructure Projects like amusement parts, entertainment multiplexes, food courts, beach resorts, eco-tourism resorts, health spas/wellness centres, convention centres, art & craft villages, yacht marinas etc. will be considered for these and other special incentives on a case by case basis.

Investment Incentives for Heritage Hotels and Buildings

Incentives are given towards the development and maintenance of heritage hotels, restaurants, boutiques and other similar activities, provided the architectural and conservation guidelines are complied with.

• Roof repair and façade improvements upto 70% of the cost of work upto a maximum of US$ 3,251.85 per building.
• Removal and alterations of existing unsympathetic changes as pointed by the competent authorities, upto 70% of the cost of work upto a maximum of US$ 2170.02 (per building).
• Construction subsidy for additional lettable rooms built within the
  conservation norms as laid down by the competent authorities, at
  20% of the building costs subject to a maximum of US$ 10852.54 per building.