Introduction

India’s start-up space has started buzzing in the past 5 years. Technological start-ups have been focusing on development and introduction of new technology which can be transformed into new products, processes which bring in new solutions. In order to encourage the youth of the state to explore their innovative ideas and to motivate them to follow through these ideas, the Government of Gujarat has come out with a new Industrial Policy providing various incentives to the start-ups in Gujarat. The primary mission of the Industrial Policy includes innovation, start-ups and technology transfer. It plans to support 2500 persons for a period of 5 years. This article will provide you with a summary of Industrial Policy of Gujarat for 2015 relating to the incentives to start-ups.

Eligibility

1. Any individual/ group of individuals who have an innovative idea or concept shall be eligible for the incentives.
2. Innovation has defined as “the process of introducing new or making changes with updated technology, large and small, radical and incremental, to products, processes and services that result in the introduction of something new and innovative products.”
3. Universities, Educational Institutions, Incubation Centers, PSUs, R&D Institutions, private and other establishments shall be eligible as an “Institution” to support and mentor the innovators as approved by the Committee.

Assistance for innovation

1. Mentoring services,
2. Use of facilities available in institutions,
3. Sustenance allowance of Rs 10,000 per month for 1 year,
4. Upto Rs 5 lakh assistance for mentoring services,
5. Upto Rs 10 lakh assistance for Cost of Raw Materials, components & other related equipment required for innovation process for the new product development,
6. will support selected innovator to get free access to University Libraries, Govt. Laboratories/ SDCs (GIDC), Centre of Excellence, PSUs.

Assistance once the idea gets commercialized

1. Upto Rs 10 lakh for marketing/ publicity for introduction of innovated product in the market,
2. Assistance in getting Venture Capital for the project,
3. VAT related assistance
   • Reimbursement of upto 80% of the net VAT paid, excluding additional tax and reduction of ITC
   • Upto 70% of eligible fixed capital investment will be considered for reimbursement
   • Eligibility period – 5 years or completion of the limit of 70%, whichever is earlier
   • The eligible unit shall be eligible for reimbursement upto 1/5th of the eligible limit in a particular year
   • Conditions to be fulfilled:
     • The amount of VAT reimbursed shall not be claimed again by the subsequent dealers by way of tax credit for interstate sales, branch transfer, consignment and export,
     • The eligible unit shall manufacture the goods in its own unit (which is eligible for incentives),
     • The eligible unit shall not transfer its business, or assign its rights and responsibilities to any other agency during the incentive period,
     • The eligible unit shall remain operational during the incentive period.

4. Other benefits available under MSME Schemes.

Procedure

1. The institutions which intend to help and promote the start-ups shall submit their proposals to the Industries Commissioner for approval of Committee as Nodal Institute.
2. The innovator will approach the institution and get its innovative idea/ concept recommended.
3. Then the Committee shall approve such idea/ concept of the innovator as is recommended by the institution.
4. After this the institution shall submit its proposal to avail assistance for providing mentoring services, and the committee, shall sanction assistance based on the number of innovators
5. The institution shall also submit proposal to avail assistance for Cost of Raw Materials, components & other related equipment required for innovation process for the new product development to Industries Commissioner.
6. The selected candidate, whose project is approved shall become eligible for sustenance allowance for 1 year from the Director, CED.
7. The Institution shall get assistance from Industries Commissioner.
8. On commercialization of the idea, the Innovator can apply to
   • the Industry Commissioner for Venture Capital Assistance, Marketing/ Publicity support,
   • the DIC for assistance under MSME Scheme and Net VAT reimbursement, etc.