Union Cabinet approved the Uttar Poorva Transformative Industrialization Scheme, 2024 (UNNATI – 2024).
UNNATI - 2024
Ministry: Central Sector Scheme under the Department for Promotion of Industry and Internal Trade, Ministry of Commerce and Industry.
Objective: Development of Industries and generation of employment in the states of North East Region.
Financial Outlay: More than Rs.10,000 crore from the date of notification for 10 years. (Additional 8 years for committed liabilities).
Nodal Agency: North-Eastern Development Financial Corporation Limited (NEDFi) will be the nodal agency for the disbursal of incentives.
Parts: It is divided into two parts:
Part A: It caters to the incentives to the eligible units (97% of the total outlay) and has three components-
Capital Investment Incentive (CII),
Central Interest Subvention (CIS), and
Manufacturing & Services Linked Incentive (MSLI).
Part B: It is for implementation and institutional arrangements for the scheme. (3% of the total outlay).
Features:
Eligibility: All new Industrial units and Expanding units would be eligible for the respective incentives.
Commencement of Production or operation: All eligible Industrial Units to commence their production or operation within 4 years from the grant of registration.
Districts are categorized in two zones: Zone A (Industrially Advanced Districts) & Zone B (Industrially Backward Districts).
Earmarking of funds: 60% of the outlay of Part A has been earmarked to 8 Northeastern states and 40% on a First-In-First-Out (FIFO) basis.
Coverage: It has a negative list for the manufacturing sector (non-eligible industries) and a positive list for the services sector (eligible industries).
Implementation Strategy: DPIIT will implement the scheme in cooperation with the states.
Incentive Mechanisms and Eligibility Criterion under UNNATI
Incentive Mechanisms
Description
Eligibility Criteria
Capital Investment Incentive (CII)
Special financial benefit provided for eligible businesses that are either new or expanding.
For manufacturing, minimum investment of INR 1 Crore and for service units, minimum investment of INR 50 Lakh in durable physical assets.
For Micro industries, minimum investment limit shall be INR 50 lakhs for both manufacturing and service sector.
Capital Interest Subvention Incentive (CIS)
It offers financial relief to eligible businesses (both new and expanding units).
Interest on loan up to the principal amount of Rs. 250 crore for investment in eligible P&M (for manufacturing sector) or building and all other durable physical assets (for service sector) shall be eligible.
Manufacturing & Services linked incentive (MSLI)
Linked to Net Payment of GST, i.e., GST paid less Input Tax Credit.
For New Units only.
Please note that different incentives are given to Zone A and Zone B under every mechanism.
Other initiatives to promote industrialization in the Northeastern Region
Prime Minister's Development Initiative for North Eastern Region(PM-DevINE): It envisages funding infrastructure, supporting social development projects, and generating livelihood opportunities for youth and women.
North East Special Infrastructure Development Scheme (NESIDS): A central sector scheme, approved during 2017-18 and extended till 2026. Its two components include:
NESIDS (Roads) – to be administered by the North Eastern Council (NEC), and
NESIDS (Other than Roads Infrastructure (OTRI)) – to be administered by the Ministry of Development of North Eastern Region (MDoNER).
Schemes of North Eastern Council (NEC): A central sector scheme for focused development of deprived areas; deprived/neglected sections of society and emerging priority sectors in the North eastern States.
NITI Forum for North East: Forum examines various proposals both at the Central and the State levels and prepare plans for the speedy development of the North Eastern Region.
Forum proposed that the development projects in the NER would be based on the concept of “HIRA” (Highways, Inland Waterways, Railways and Airways).
Digital North East Vision 2022: It identifies eight digital thrust areas – Digital Infrastructure, Digital services, Digital empowerment, Promotion of Electronics Manufacturing, Promotion of IT and ITes including BPOs, Digital Payments, Innovation & Startups and Cyber security.
Special Accelerated Road Development programme for North East (SARDP-NE): Ministry of Road, Transport and Highways is implementing the SARDP-NE under Bharatmala Pariyojana Phase I.
Conclusion
By providing financial incentives for businesses, creating jobs, increasing backward and forward linkages and promoting domestic manufacturing and services, UNNATI fosters a more robust and self-sufficient Indian economy.
Furthermore, the program's government backing adds a layer of reliability and stability, encouraging businesses to confidently invest in growth. This will help in achieving the goal of Atmanirbhar Bharat.
Status of Industrialization in Northeast India
Special Economic Zones (SEZs): There are 5 formally approved SEZs in the NER, out of which 4 are notified. However, none of the SEZs is operational.
Specialized industries:
Handloom and handicraft industries: It is one of the largest unorganized economic activities in the NER that provides employment for rural and semi-rural population.
Bamboo industry: Nearly two-fifths of bamboo stock in India is concentrated in the NER.
Rubber industry: Tripura is the chief production hub and has been declared the ‘second rubber capital of India’ after Kerala by the Indian Rubber Board.
MSMEs: Number of MSMEs in NER are only 2.98% of total MSMEs in India and accounts for 2.62% of total employment.
Assam has largest number of MSMEs in NER followed by Tripura and Meghalaya.
Connectivity:
Road Connectivity: Total length of national highway has increased to 16,125 Kms in the region.
Inland waterways:National Waterway (NW) 2 from Bangladesh border to Sadiya on Brahmaputra is fully developed and 20 waterways of NER have been declared as National Waterways
However, feasibility study for 18 waterways have not been yet completed.
International infrastructure projects: There are several international infrastructure projects in different stages of implementation:
India- Myanmar-Thailand Trilateral Highway
Kaladan Multimodal Transit Transport Project
India-Bangladesh Protocol Route
Bangladesh-Bhutan-India-Nepal Motor Vehicles Agreement (BBIN-MVA)
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