Dr.Babasaheb Ambedkar Udyog Uday Yojana: Assistance for Interest Subsidy (Manufacturing Sector)
Dr. Babasaheb Ambedkar Udyog Uday Yojana gives SC/ST-owned manufacturing MSMEs in Gujarat an interest subsidy of up to 8% on term loans (max ₹35 lakh/year for 7 years) — significantly cutting borrowing costs for new factories in priority talukas.
About This Scheme
Dr. Babasaheb Ambedkar Udyog Uday Yojana gives SC/ST-owned manufacturing MSMEs in Gujarat an interest subsidy of up to 8% on term loans (max ₹35 lakh/year for 7 years) — significantly cutting borrowing costs for new factories in priority talukas.
Full official description
The scheme "Dr.Babasaheb Ambedkar Udyog Uday Yojana" is an umbrella scheme launched by the Industries and Mines Department, Gujarat. It aims to empower the state's dynamic MSME sector, which significantly contributes to employment, GDP, and exports. Effective from August 7th, 2020 to August 6th, 2025, this initiative supports SC/ST entrepreneurs and strengthens MSMEs, making them globally competitive. The component "Assistance for Interest Subsidy (Manufacturing Sector)" provides financial relief to enterprises in the manufacturing sector by offering an interest subsidy on term loans. Additional benefits are available for women entrepreneurs, differently-abled entrepreneurs, startups, and young entrepreneurs below 35 years of age.
Benefits
Interest subsidy on term loans (SC/ST manufacturing MSMEs):
| Taluka Category | Subsidy Rate | Max per year | Duration |
|---|---|---|---|
| Category I | 8% | ₹35,00,000 | 7 years |
| Category II | 6% | ₹30,00,000 | 6 years |
| Category III | 5% | ₹25,00,000 | 5 years |
Who Can Apply (Eligibility)
MSME owned and run by SC/ST entrepreneur, engaged in manufacturing, located in Gujarat. New unit must have commenced commercial production after the scheme's start date.
Exclusions
- Enterprises whose term loan is sanctioned after one year from the commencement of commercial production.
- Enterprises defaulting on loan repayments as per RBI and bank guidelines.
- Enterprises seeking reimbursement for penal interest or other bank charges.
- Enterprises availing interest subsidy under any Central Government scheme where the total subsidy exceeds the total interest paid.
How to Apply
Registration Process:
Step-1: Visit the Investor Facilitation Portal (IFP) portal. Click on "New Investor Registration" to access the registration form.
Step-2: Fill in the Registration Form. Click on "Submit".
Step-3: Verify the E-mail ID using the link sent on your registered E-mail ID.
Step-4: After verification, you will be registered successfully.
Post-Registration Process:
Step-1: Visit the Investor Facilitation Portal (IFP) portal. Click on "Login".
Step-2: Enter the email address and password you used during registration.
Step-3: Click the "Login" button to access your account.
Step-4: Now fill in the required details and mandatory documents about your business to complete the application process.
Helpdesk: Contact Here.
Frequently Asked Questions
What is the "Dr. Babasaheb Ambedkar Udyog Uday Yojana"?
It is a special scheme introduced under the Industrial Policy 2020 to provide financial assistance and support to Scheduled Caste (SC) and Scheduled Tribe (ST) entrepreneurs in the MSME sector.
What sectors are prioritized under the Industrial Policy 2020?
The policy prioritizes industries such as Auto and Auto Components, Chemicals and Petrochemicals, Pharmaceuticals, Cement, Textiles, Engineering, Gems and Jewellery, and Ceramics.
How does the scheme promote export competitiveness?
The scheme emphasizes "Vocal for Local to become Global," strengthening integrated value chains and encouraging MSMEs to enhance their export potential.
What is the duration of the scheme?
The scheme is effective from August 7, 2020, and will remain in operation until August 6, 2025.
What is the objective of the component "Assistance for Interest Subsidy (Manufacturing Sector)"?
The component "Assistance for Interest Subsidy (Manufacturing Sector)" provides financial support to enterprises in the manufacturing sector by subsidizing the interest on term loans.
Who is eligible to apply for the interest subsidy?
Enterprises engaged in the manufacturing sector with a valid term loan sanctioned before the commencement of commercial production are eligible to apply.
What is the maximum interest subsidy that an enterprise can receive?
The maximum interest subsidy an enterprise can receive is 8% for Category I Taluka, 7% for Category II Taluka, and 6% for Category III Taluka, including additional benefits.
For how many years will the interest subsidy be provided?
The subsidy will be provided for a period of 5 to 7 years, depending on the category of the taluka where the enterprise is located.
Can an existing manufacturing enterprise apply for the subsidy?
Yes, an existing enterprise can apply, provided it meets the eligibility criteria and has a valid term loan sanctioned before commercial production starts.
What is the minimum interest an enterprise has to bear?
Every enterprise must bear a minimum of 2% interest on the term loan, regardless of the subsidy received.
Can an enterprise apply for the subsidy after starting commercial production?
An enterprise can apply within one year from the first loan disbursement or before commercial production begins, whichever is later.
Can an enterprise avail both State and Central Government interest subsidies?
Yes, but the total interest subsidy from both the State and Central Government cannot exceed the total interest paid to the financial institution.
What happens if an enterprise defaults on loan repayment?
If an enterprise defaults on loan repayment, the default period will be deducted from the subsidy calculation, and the enterprise may lose eligibility.
Can an enterprise receive interest subsidy for installing a solar or renewable energy system?
Yes, existing enterprises that install solar or other renewable energy systems for captive consumption are eligible for an additional interest subsidy.
Ready to apply?
Visit the official government portal to apply for this scheme.
Apply on myScheme.gov.inDocuments Required
- Printed copy of the application along with declaration and undertaking in the application form signed by an authorized person, including their designation and name with the enterprise's stamp.
- Copy of acknowledgment of Udyog Aadhaar / Udyam Registration.
- Copy of term loan sanction letter.
- Copy of term loan account statement / bank certification of first disbursement certificate.
- Copy of the constitution of the enterprise (registered partnership deed for partnerships).
- Copy of DPR of the enterprise (for projects up to ₹5 crores); for projects above ₹5 crores, DIC will ask for a bank appraisal report.
- Shop & Establishment Certificate (for service sector enterprises in municipal corporations).
- Copy of GST registration (if applicable).
- Copy of PAN card of the enterprise.
- Copy of ITR for the last financial year showing plant & machinery value (new enterprises must submit a self-declaration for the first time).
- Copy of birth certificate/school leaving certificate (for entrepreneurs under 35 years as of the bank loan sanction date).
- Copy of caste certificate from a competent authority.
- Copy of certificate for differently abled persons from a competent authority.
- Copy of CTE issued by the GPCB (if applicable).
- Self-certified/certified copy of documents such as 7/12 Utara, Namuna 6, copy of index, property card, etc. (any one).
- NA permission (if applicable).
- Copy of notarized rent deed (agreement) with the owner's proof/affidavit for ownership of land/property.
- Copy of lease deed (agreement) with the owner's proof of ownership of land/property.
- Copy of the property tax receipt (for service activities).
- Board resolution for signing authority (in case of partnerships, LLPs, Pvt. Ltd., or Limited Companies).
- Declaration and undertaking regarding other investments in Gujarat.
- Annexure of the balance sheet showing the gross fixed capital investment of the previous financial year.
- CA certificate showing the gross fixed capital investment before initiating expansion/diversification/forward or backward integration.