UP: Yogi govt 2.0 to recast MSME policy to groom women entrepreneurs

To offer stamp duty, capital subsidy to attract investment under new MSME policy

The Uttar Pradesh government is recasting its policy to boost micro, small, and medium enterprises (MSMEs) and encourage women entrepreneurs.

Under the proposed new policy, women entrepreneurs would receive a 100 per cent stamp duty subsidy on the purchase of land for setting up micro and small units. Besides, other MSMEs would receive a 50 to 100 per cent subsidy depending on the region of the state.

Stamp duty would be cheaper in comparatively backward regions of Bundelkhand and Purvanchal (Eastern Uttar Pradesh) than in the central and western districts. This is aimed to encourage fresh investment, particularly in the manufacturing sector, in laggard pockets and beyond the National Capital Region (NCR) districts of Western UP.

The Yogi Adityanath government has started preparing for a mega investor summit in January 2023. It has also roped in global consultancy major Deloitte to draft the blueprint for making the state a trillion-dollar economy in the next five years.

“We are in the process of updating our MSME policy to make it more attractive for private investment,” state MSME and export promotion Additional Chief Secretary Navneet Sehgal told Business Standard.

The state would offer a 100 per cent stamp duty rebate in Bundelkhand and Purvanchal, while central UP and western UP regions (excluding Noida and Ghaziabad) will get a 75 per cent subsidy. The state government is expected to provide a 50 per cent stamp duty subsidy in the districts of Gautam Buddha Nagar (Noida) and Ghaziabad.

Apart from the stamp duty waivers, the state will offer capital subsidies to woo the private sector.

For example, MSMEs in Bundelkhand and Purvanchal would receive capital subsidies in the range of 15 to 25 per cent. The respective capital subsidies in central and western UP will be capped at 10 to 20 per cent.

Meanwhile, the state will facilitate cheaper working capital loans for the sector from the commercial banks and financial institutions. The state will offer up to 6 per cent interest subsidy on working capital loans, especially in Bundelkhand and Purvanchal districts.

Under Yogi Adityanath’s regime between 2017 and 2022, about 10 million MSME entrepreneurs had availed of loans worth more than Rs 2.5 trillion.