The Union Cabinet, led by Prime Minister Narendra Modi, has given the green light to the Uttar Poorva Transformative Industrialisation Scheme, 2024 (UNNATI – 2024), as proposed by the Ministry of Commerce and Industry, Department for Promotion of Industry and Internal Trade. This ambitious scheme, spanning a decade from its notification date and allowing an additional eight years for committed liabilities, is set to unfold with a total budget of Rs 10,037 crore.
UNNATI – 2024 represents a significant leap towards fostering industrial growth and development in the Uttar Poorva region, poised to invigorate economic prospects and catalyse transformative change across various sectors. Prime Minister Narendra Modi’s recent decisions underscore a steadfast commitment to the development of Assam and the North East region. Notably, a semiconductor manufacturing centre is slated for establishment in Assam, backed by a substantial investment of Rs 27,000 crores, as approved in a recent Cabinet meeting chaired by PM Modi. Furthermore, the Cabinet’s sanctioning of an expenditure of Rs 10,037 crore over eight years, along with a ten-year responsibility commitment, to drive transformative industrialisation in the North East highlights the Government’s proactive stance towards regional economic upliftment. The approval of the Department of Initiative and Internal Commerce’s proposal for the initiative and promotion of commerce for the year 2024 (Development-2024) signifies a pivotal moment for the region’s economic landscape. With these measures, a new chapter of industrial growth and prosperity is poised to unfold in Assam and the broader North East region, marking a promising trajectory of development under Prime Minister Modi’s leadership.
UNNATI – 2024 – Objective:
The Government of India has introduced the New Industrial Development Scheme, UNNATI (Uttar Poorva Transformative Industrialisation Scheme), 2024, as a pivotal initiative aimed at fostering industrial growth and employment generation within the States of the North East Region (NER). This scheme stands as a cornerstone for the economic transformation of the region, strategically designed to stimulate productive economic activities across the manufacturing and service sectors. The overarching objective of UNNATI is to catalyse gainful employment opportunities, thereby catalysing comprehensive socio-economic development in the NER.
Proposed Incentives:
The following incentives would be available under the scheme to investors for setting up new units or undertaking a significant expansion of the existing units.
● Under the proposed scheme, investors looking to establish new units or expand existing ones stand to benefit from various incentives. The incentives are categorised based on the applicability of Goods and Services Tax (GST).
● For areas where GST is applicable, investors can avail of the Capital Investment Incentive, with Zone A offering up to 30 per cent with a cap of Rs 5 crore, and Zone B providing up to 50 per cent with a cap of Rs 7.5 crore. Additionally, the Central Capital Interest Subvention offers a 3 per cent interest subsidy for seven years in Zone A and 5 per cent in Zone B.
● In areas where GST is not applicable, the Capital Investment Incentive remains consistent, with Zone A offering up to 30 per cent with a cap of Rs. 10 crore, and Zone B providing up to 50 per cent with a cap of Rs 10 crore. Similarly, the Central Capital Interest Subvention remains unchanged, offering a 3 per cent interest subsidy for seven years in Zone A and 5 per cent in Zone B.
● Furthermore, a Manufacturing & Services linked incentive (MSLI) is available exclusively for new units. This incentive is tied to the net payment of GST, with Zone A offering up to 75 per cent of the eligible value of investment in Plant & Machinery (P&M) and Zone B providing up to 100 per cent of the eligible value of investment in P&M.
These incentives aim to encourage investment and foster growth in both new and expanding industrial units, promoting economic development across different zones.
Expenditure involved:
The proposed scheme entails a financial outlay of Rs 10,037 crore over a ten-year period from the date of notification, with an additional provision of eight years for committed liabilities. This scheme, classified as a Central Sector Scheme, will be divided into two distinct parts. Part A, allocated Rs 9,737 crores, focuses on providing incentives to eligible units. Meanwhile, Part B, earmarked with Rs 300 crores, is designated for the implementation and establishment of institutional arrangements necessary for the scheme’s operation and success.
Target:
The proposed scheme aims to receive approximately 2180 applications, paving the way for an anticipated creation of about 83,000 direct employment opportunities throughout the scheme’s duration. Moreover, a substantial number of indirect employment opportunities are also expected to emerge as a result. This initiative not only addresses the immediate need for job creation but also holds the potential to catalyse broader economic growth and prosperity within the targeted sectors.
Salient features of the scheme:
● Scheme period: The scheme will be effective from the date of Notification and up to 31.03.2034, along with eight years of committed liabilities.
● Application period for registration: Industrial unit will be allowed to apply for registration from the date of notification up to 31.03.2026
● Grant of registration: All applications for registration shall have to be disposed of by 31.03.2027
● Commencement of Production or operation: All eligible Industrial Units are to commence their production or operation within four years from the grant of registration.
● Districts are categorised in two zones: Zone A (Industrially Advanced Districts) & Zone B (Industrially Backward Districts) vi. Earmarking of funds: 60 per cent of the outlay of Part A has been earmarked to 8 NE States and 40 per cent on First-In-First-Out (FIFO) basis. vii. For Micro industries (defined as per MSME industry norms), the P&M calculation will include the building construction and P&M costs for Capital Investment Incentive.
Implementation strategy:
● The implementation strategy for the scheme involves a collaborative effort between the Department for Promotion of Industry and Internal Trade (DPIIT) and the respective States. Oversight and coordination will be facilitated through the establishment of various committees at both the national and State levels.
● At the national level, the Steering Committee, chaired by the Secretary of DPIIT (SIIT), will play a pivotal role in providing guidance and direction for the scheme. This committee will deliberate on any interpretations of the scheme within its designated financial framework and issue comprehensive guidelines for its effective execution.
● On the State level, the State Level Committee, under the leadership of the Chief Secretary of each State, will assume responsibility for monitoring the implementation process. This committee will ensure the adherence to checks and balances, promoting transparency and operational efficiency throughout the execution of the scheme.
● Furthermore, the Secretary Level Committee, led by the senior Secretary of the State’s Industries department, will be tasked with the direct implementation of the scheme at the State level. This includes the facilitation of registrations and the processing of incentive claims, thereby ensuring smooth and efficient execution of the scheme’s objectives. Collaboration between these committees at both national and state levels will be essential in driving the successful implementation of the scheme and achieving its intended outcomes.
UNNATI’s Positive/Negative List:
Fostering Sustainable Industries:
In order to invigorate industrial progress while ensuring environmental sustainability, UNNATI places emphasis on striking a delicate balance between industrial expansion and the preservation of the pristine environment of the NER. This imperative is reflected in the delineation of a positive list, comprising industries deemed conducive to the region’s sustainable development. Notably, sectors such as renewable energy and electric vehicle (EV) charging stations feature prominently on this list, underscoring the scheme’s commitment to fostering environmentally conscious industrial practices.
Conversely, a negative list has been established to mitigate potential adverse environmental impacts stemming from certain industries. Sectors such as cement and plastic, which possess the propensity to degrade the region’s ecological integrity, are excluded from the purview of UNNATI’s incentivisation framework. By delineating these lists, the scheme endeavours to channel investments towards industries that align with the imperatives of sustainable development while preemptively safeguarding the NER’s ecological equilibrium.
Through the implementation of UNNATI, the Government seeks to provide a renewed impetus to industrialisation in the NER, with a concerted focus on job creation, skill enhancement, and the promotion of sustainable development practices. By attracting new investments and nurturing existing ones in alignment with the positive list, UNNATI aims to unlock the region’s economic potential while upholding its environmental
UNNATI – 2024 emerges as a visionary scheme poised to revolutionise industrial growth and economic prospects in the Uttar Poorva region. With a comprehensive set of incentives and a strategic focus on sustainable development, the scheme not only aims to create employment opportunities but also seeks to foster a conducive environment for holistic socio-economic progress. By promoting investments in environmentally conscious industries and fostering collaboration between national and state-level committees, UNNATI paves the way for transformative change, positioning Uttar Poorva as a beacon of industrial innovation and prosperity in the years to come.
