Before we earn the knowledge of significant grants offered by the Indian government, let us first understand what subsidies means. A subsidy can commonly be called as the adverse of tax, which is a means of financial policies. Subsidy word was initially derived from ‘subsidium’ which belongs to the Latin language. The meaning of the word ‘subsidium’ in Latin is support from behind the curtains. Nonetheless, it won’t be wrong to say that the potential of subsidy is at its best only when they are transparent, properly aimed and are suitable to implement in real life scenarios.
India is a country which is setting its roots in the world of entrepreneurship. Even though the history and stories of entrepreneurship go back to the time of Vedas but after the colonization period, the situation of entrepreneurs dropped to its lowest point. The government of India provides different subsidies and incentives so that the vibrant world of the business can spread its wings and fly higher, providing more job opportunities to the local population. Managing a business or putting your ideas into action is not an easy task. It involves money, and if you know about various that you can get from the Indian government, then the burden can be profoundly lessened. If you also wish to be an entrepreneur then here lies a list of different subsidies and incentives which are must know for each and every entrepreneur:
- Credit Linked Capital Subsidy Scheme (CLCSS): It has been noted that most of the small scale companies, still uses old technologies and machinery to manufacture goods and products. These outdated technologies adversely affect their business. The outdated technologies are still in use because of lack of knowledge and information. The small scale business people lack awareness about the capital access, various advanced and modernized technologies and benchmark set on the goods qualities. Nonetheless, it won’t be wrong to say that the modernization and globalization of the world have made it a necessity that the technologies and machinery should be upgraded if they wish to survive in this competitive world. By the ministry of small scale industries, it was taken as a responsibility by them to facilitate the up gradation of the technology. The department has developed a scheme known as Credit Linked Capital Subsidy Scheme (CLCSS). This project provides 15% subsidy on the capital for SSI units on the functional finances availed for the good establishment and upgraded technology in various sub-sectors and different products approved under the plan for a credit of up to Rs. 1 crore.
- Subsidy for establishing cold chain: A robust and vigorous food processor plays an important role to protect the perishable food items, agricultural products and enhance the income of the farmers and saving the surplus amount for export. To help the farmers and entrepreneurs, the government of India provides a subsidy for the cold chains. This scheme provides fiscal support for the cold chain and preservation of perishable items.
- Technology Upgradation Fund Scheme (TUFS): This subsidy is availed in the sector of textiles. In our country textile industry is the second largest industry that provides employment. The ministry of textile under its flagship program named as Technology Upgradation Fund Scheme (TUFS), helps the industry to achieve new heights and improve its technologies so that it can compete with the world standards. A 5% of interest reimbursement is given, on the interest charged by various banks and financial institutions. This scheme also provides a marginal amount and subsidies for investing in different equipment and technologies.
- Support for acquiring quality management system: With the high level of competition in the global market, is has become essential and vital for the MSME units to maintain the quality benchmarks. This reference is essential for the survival, successful competition and enhances profitability in this cut-throat competitive world. The Government of India provides a subsidy so that it becomes easy for the entrepreneurs to obtain an ISO certificate like ISO 9001 and ISO 14001, overall, fulfilling the motive of increasing the adoption of enhanced quality standards.
- Interest subsidy for MSME Units in Gujarat: The state government of Gujarat, provides interest subsidies for the MSME units in Gujarat so that the industrialization can be boosted and more people invest in various business sectors. The backbone of any economy is said to be MSME units, and this subsidy helps in enhancing this area highly in Gujarat. This plan provides 7% interest subsidy to micro enterprises and 5% interest subsidy in medium and small sectors.
- Capital subsidy for solar lighting and small capacity PV systems: Jawaharlal Nehru National Solar Mission (JNNSM) was initiated by the Indian government to promote the sustainable energy sources and help solve the growing need for the power of the country. The JNNSM provides soft loans and various subsidies to promote the usage and establishment of solar power generating plants in the country. JNNSM provides a subsidy of approximately 40% on the approved cost for the various system used for solar lighting and small photovoltaic units.
- Support for International Patent protection in Electronics and IT: The department of information Technology, MCIT, GOI initiated a scheme that provides financial support to all the SMEs and various other technical start-ups for the international patent filing so that vivid innovations can be encouraged, their true potential and values can be realized. This subsidy is also important because it enhances the capabilities of the inventions globally and captures various growth opportunities for the innovations and researches in the world of information technology and electronics. Through this grant, all the cost including the fees of the attorney, fees for filing the patent, examination fees and all other additional costs up to the level of acceptance of patent if subsidized. This plan provides a subsidy of up to 50% as reimbursement of the overall patent fee. The support is compared to Rs. 15 Lacs or 50% of the overall fee, whichever is less.
Fagnum always strives towards making the entrepreneurs of India aware of their rights and benefits. After knowing the importance of these 7 subsidies you might now be able to take benefits of them which you could not have before reading this.
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