25% Capital Subsidy and 7% Interest Subsidy to Ethanol Plant in Gujarat
Fueling Growth: Unlocking Subsidies for Biofuel Manufacturing Plants – With a 25% capital subsidy, a 7% interest subsidy, and various other incentives, Gujarat is paving the way for substantial support to Ethanol Plants and biofuel manufacturing in Gujarat.
Embarking on a green revolution, Gujarat stands out as a trailblazer in sustainable energy solutions, offering substantial subsidies to biofuel and ethanol production plants in Gujarat. As the demand for eco-friendly alternatives rises, the state incentivizes businesses with a generous subsidy program. This initiative not only supports the establishment of biofuel and ethanol production facilities but also positions Gujarat as a leader in the clean energy sector.
Period for the Subsidy
Crucially, Gujarat’s commitment spans a 5-year subsidy period, from February 15, 2022, to March 31, 2027. This substantial timeline provides an excellent window of opportunity for investors and entrepreneurs to capitalize on financial incentives and contribute to the growth of the biofuel and ethanol production landscape in the state.
Mega Biofuel Project
Any eligible Biofuel manufacturing unit with GFCI more than or equal to INR 200 Crores or providing Direct Employment of more than or equal to 500 will be considered as Mega Biofuel Projects.
Biofuel is Special Projects
Ethanol, a biofuel derived from renewable sources like rice, corn or sugarcane, is a clean-burning alternative that significantly reduces greenhouse gas emissions, contributing to a greener energy future. Projects of strategic importance, in challenging areas and in emerging technologies will be considered as Special Projects. Ethanol is a emerging biofuel and Ethanol Production Plant in Gujarat will be treated as Special Projects in Gujarat.
How To Start Ethanol Production Plant In Gujarat / India ?
Which Type of Cost included in calculation of Subsidy / Incentives?
Gross Fixed Capital Investment (GFCI) for applicant units, means the investment made in building, plant & machinery and other related fixed assets including common infrastructure such as effluent treatment plant, testing facilities, shared data center, etc. required to manufacture end-products or provide services by eligible unit for setting up new unit or for undergoing expansion/ diversification but excluding cost of land. The eligible fixed capital investment of the project will be decided on the basis of the following criteria.
| Eligible Fixed Capital Investment | Description Of Criteria |
| Cost of Land | Not Covered for the calculation of incentives / subsidy amount. |
| Cost of Building | Eligible Gross Fixed Capital Investment (eGFCI) is to be calculated in a manner that the expenditure on buildings cannot be more than 20% of the eligible GFCI. |
| Other Infrastructure Facilities | The Cost of fixed assets including common infrastructure such as effluent treatment plant, testing facilities, shared data center etc. is eligible GFCI. |
| Other utilities | Expenses towards Computers & Software, Furniture & Fixtures, Office Equipment, Vehicles, etc. (movables items) will NOT be considered towards eligible GFCI |
How much and Which Type of Subsidy is available for Ethanol Manufacturing Plant in Gujarat?
The subsidy is available as follow:
| Sr. No.
| Type of Subsidy | Ethanol Plants with GFCI less than INR 200 Crores | Mega & Special Units (GFCI more than INR 200 Crores) | Disbursement
| |
| 1.
| Capital Subsidy | 25% of eGFCI ceiling amount is INR 40 Crores | 25% of eGFCI ceiling amount is INR 200 Crores | Twenty (20) Quarterly installments spread over Five (5) Years. | |
| 2. | Operational Assistance | 15% of Operational Expenditure with ceiling of INR 5 Crores per annum | 15% of Operational Expenditure with ceiling of INR 25 Crores per annum | On approval of Application by the committee | |
| 3. | Employment Generation Incentive | 50% of CTC with a ceiling not exceeding INR 50000 per male employee and not exceeding INR 60000 per female employee. | 50% of CTC with a ceiling not exceeding INR 50000 per male employee and not exceeding INR 60000 per female employee. | Beneficiary shall choose any one option amongst quarterly or half yearly or annual Operational Assistance claim, which shall be applicable for the duration of years from commercial operations date. | |
| 4. | EPF Assistance | 100% of EPF amount paid in case of female employees and 75% EPF amount paid in case of male employees | 100% of EPF amount paid in case of female employees and 75% EPF amount paid in case of male employees | ||
| 5. | Interest Subsidy on Term Loan |
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| 6. | Electricity Duty | 100% Electricity Duty on power purchased | 100% Electricity Duty on power purchased | ||
| 7. | Facilitation Support | NA | Officer would be appointed as Specific Point of Contact (SPOC) for each project approved under this package. Further, as part of this package, support will be provided through inter-departmental co-ordination for land identification/ mobilization & Trunk infrastructure (approach road, water supply, power, sewerage, etc.). |
What is the Maximum ceiling Limit of Capital Subsidy to Ethanol Manufacturing Plant?
The maximum ceiling is Rs. 40 Crore for Ethanol Production Plant’ investment less than 200 Crore.
The maximum ceiling is Rs. 200 Crore for Ethanol Production Plant’ investment more than 200 Crore.
What are the steps for getting subsidy / incentives for Ethanol Production Plant in Gujarat?
STEPS | |||
| 1. Industry Connect, Query resolution and in principle approval
| 2. Application, Physical verification and Approval of claim amount
| 3. Post – Approval: Disbursal of Capital and Operational Assistance
| 4. Supplementary Claim Physical Verification & Disbursal
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