Gujarat MSME Assistance Scheme
Viksit Gujarat Industrial Policy 2026
Capital subsidy, interest subsidy and power tariff support for new, expanding and diversifying manufacturing MSMEs in Gujarat, plus assistance for EPF, rent, technology, quality certification, patents and more.
GR No. IMD/WRT/e-file/9/2026/2630/CH dated 25/09/2026, Industries & Mines Department, Government of Gujarat
Check availability: Notified by GR dated 25 Sep 2026 and operative from 1 June 2026 to 31 May 2031. Check the Industries Commissionerate / MSME Commissionerate, Gujarat for detailed guidelines and the application process.
Key benefits
- Capital subsidy of 35% (Category A taluka) or 25% (Category B taluka) of eligible investment; micro units get it in year 1, small and medium units over 5 years.
- Interest subsidy of 7% on term loans from banks or RBI-recognised financial institutions for 5 years (up to 10% of investment); +1% for women, first-generation entrepreneurs and startups.
- Power tariff support of ₹2 (Category A) or ₹1 (Category B) per unit for 5 years, subject to a 25% cap as set out in the GR.
- Enterprises can choose any one component or a combination, within the overall ceiling of 45% (Category A) or 35% (Category B) of eligible investment.
- Other assistance: 100% employer EPF reimbursement for new employees, rent assistance, ICT/AI and ERP support, quality certification, technology acquisition, patents, CGTMSE fee reimbursement and electricity duty exemption.
Basic eligibility
- Manufacturing, production, processing or job work of articles only. Service and trading units are not eligible.
- Micro, small or medium enterprise by investment in plant & machinery (Micro up to ₹2.5 Crore, Small up to ₹25 Crore, Medium up to ₹125 Crore).
- New units must start commercial production between 1 June 2026 and 31 May 2031; expansion and diversification projects must meet minimum investment and capacity increases.
- At least 85% of staff, and 60% of managerial/supervisory staff, domiciled in Gujarat.
- Units that started production before 1 June 2026, or investment already claimed under another State scheme, are not eligible.
Who is eligible
| Criteria | Requirement |
|---|---|
| Activity | Manufacturing, production, processing or job work of articles only. Service and trading not eligible. |
| Legal form | Company, LLP, partnership, proprietorship, society, trust, industrial co-operative |
| Micro | Investment in plant & machinery up to ₹2.5 Crore |
| Small | Plant & machinery above ₹2.5 Crore up to ₹25 Crore |
| Medium | Plant & machinery above ₹25 Crore up to ₹125 Crore |
| New unit | Udyam / IEM / LoI obtained; commercial production starts 01.06.2026 – 31.05.2031 |
| Expansion | +50% investment (60% in plant & machinery), +50% capacity, existing unit at 75% utilisation |
| Diversification | +25% investment (Micro/Small) or +50% (Medium), 60% in plant & machinery |
| Employment | 85% of staff domiciled in Gujarat; 60% of managerial/supervisory staff |
| Not eligible | Units that started production before 01.06.2026 (old scheme only); investment already claimed under another State scheme |
Which investment is eligible
| Item | Eligible? | Remarks |
|---|---|---|
| New building on own land / GIDC plot | Yes | Lower of actual cost or R&B Schedule of Rates |
| New building on leased / rented land | Yes | Lease deed / rent agreement must cover the incentive period (5 years from production) |
| Factory, R&D, testing, storage building | Yes | At actual cost |
| Compound wall, roads, bore well, tanks, pipelines | Yes | At actual cost |
| New plant & machinery | Yes | Including transport, foundation, erection, electrification, sub-station |
| Captive power, DG set, pollution control, water plant | Yes | DG set up to 50% of load or 5 MW |
| Technology, design, patents | Yes | Maximum 10% of plant & machinery value |
| Worker housing, feeder road, training centre, buses | 50% | Only half the cost counted |
| Land and land development | No | |
| Rented / leased building or assets | No | Building must be constructed / owned by the unit |
| Old building, repairs, refurbishment | No | |
| Second-hand machinery | No | |
| Working capital, goodwill, royalty, pre-operative expenses, capitalised interest | No | |
| Consultancy, design, supervision fees | No | Unless part of technology acquisition |
Investment period: assets bought and paid for from 01.01.2026 up to 12 months after the start of production (18 months if plant & machinery is above ₹50 Crore).
Quantum of assistance
| Component | Category A taluka | Category B taluka |
|---|---|---|
| Overall ceiling (5 years) | 45% of eligible investment | 35% of eligible investment |
| Capital subsidy | 35% | 25% |
| Interest subsidy | 7% on term loan, 5 years (max 10% of investment) | 7% on term loan, 5 years (max 10% of investment) |
| Power tariff | ₹2 per unit, 5 years (max 25%) | ₹1 per unit, 5 years (max 25%) |
| Annual cap: Micro | Year 1: 37% | Years 2–5: 2% | Year 1: 27% | Years 2–5: 2% |
| Annual cap: Small / Medium | 9% per year | 7% per year |
| Women / first-generation / startup | +1% interest subsidy | +1% interest subsidy |
An enterprise may choose any one component or a combination. Micro units receive capital subsidy in year 1; small and medium units over 5 years. The term loan must be from a bank or RBI-recognised financial institution (NBFC loans are not eligible). The unit bears a minimum of 2% interest.
Thrust sectors (sports goods, toys, footwear, robots, drones)
| Component | Category A | Category B |
|---|---|---|
| Overall ceiling | 50% | 45% |
| Capital subsidy | 35% | 30% |
| Interest subsidy | 7%, max 20% of investment | 7%, max 20% of investment |
| Power tariff | ₹2 per unit, max 20% | ₹1 per unit, max 20% |
Other assistance
| Scheme | Assistance | Maximum |
|---|---|---|
| EPF reimbursement | 100% of employer EPF for new employees, 5 years | ₹1,800 / ₹2,500 (women) / ₹3,000 per month |
| Rent assistance | 65% of shed rent (75% for women-owned units), 5 years | ₹3 Lakh per year |
| ICT / AI / Industry 4.0 | 65% of capex | ₹5 Lakh |
| ERP software | 65% of cost | ₹1 Lakh |
| Quality certification | 50% of fees + testing equipment | ₹10 Lakh |
| Technology acquisition | 65% of cost | ₹50 Lakh |
| Patent registration | 75% of cost | ₹25 Lakh |
| Power connection (outside GIDC) | 35% of charges | ₹5 Lakh |
| CGTMSE fees | 100% of annual fee, 5 years | – |
| Electricity duty | Full exemption | – |
Documents checklist
The document list will be set out in the detailed guidelines and application process for this scheme. Talk to us and we'll help you prepare what is needed, typically Udyam Registration, project cost details, term loan sanction and proof of investment.
This summary is for general information and may not reflect the latest notification; confirm details on the official portal. The Government Resolution and the guidelines issued under it prevail. Sanctions and subsidies are decided by the bank or government agency after their own appraisal. We do not guarantee approval.