GOVERNMENT OF ANDHRA PRADESH(Government of Andhra Pradesh accords high priority to industrial growth as a means to mitigate poverty and reduce unemployment. The Industrial Development Policy 2015-20 aims to promote manufacturing, enhance inclusivity, foster innovation and create employment opportunities across sectors. Various best-in-class policy instruments and fiscal incentives have been offered to spur industrial growth, Industrial development in Andhra Pradesh is predicated on robust infrastructure, including land banks, 24X7 power supply and providing conducive environment for innovation & industry to thrive. The State has undertaken series of measures to improve Ease of Doing Business such as strengthening Single Desk mechanism for expediting approvals and developing real-time project tracking tools, amongst others. Recognizing the need to nurture talent pool and develop a strong base of skilled manpower, Industrial Development Policy 2015-20 places special ‘emphasis on progressive labour policies and skill development initiatives. Special package of incentives has been proposed for SC/ST, Backward Caste and women entrepreneurs to actively involve them in the economic development of the State, Sustainable industrial development is promoted through a host of incentives outlined under the aegis of ‘Swachh Andhra’. lam certain that the Industrial Development Policy 2015-20 would act as a strong foundation for the development of the State, and make it a leading destination for both domestic and global investment. We look forward to welcoming you and forging strong partnerships as we ‘embark on the growth trajectory of Sunrise Andhra Pradesh. Nara Chandrababu Naidu Hon'ble Chief Minister of Andhra Pradeshfol ecole eam ice ee 07 Neto eco ec ro NC Sage cy APIIC ae ou Rea k ey No ee ke Ld folie fee aac Re oe coo) eee aun cae) eo CCRC ac ce Cen corr Ce Ce aco GSDP eS Oa aart ad IGBC ORT ae kecrte nS TUR Aaa NIMZ Deena A Reuter Pd IED Neu ee eee cy eas Nee eee ae a cg Be aa R&D Reena ears SEZ ence and aT} So Cue sipc. Bee uae akc aT See uaa) Niall Visakhapatnam-Chennai Industrial Corridor01 PREAMBLE OE eee prea etary Cee a eas was introduced in Lok Sabha Reena oar Home Affairs. It provided for Sees Been ar ecco This Bill was approved by the reece ga El published in the Official coe eee UC) ree eeu acd Ps aCe eee aC SRO CuC Re acc cree) er eee ieee CTCL cae MC ed ee CU Cae ce Krishna, Guntur, Nellore, CC OM Anantapur and Chittoor. cereals Seen~~ om gee Seo Ce ences ers Can eu Ione rc men oe eto Ore The State has a population of 4.93 crore (as per population census - 2011), accounting for 4% of Country's population, residing in 4.9% of country's geographical area Andhra Pradesh has abundant natural resources (Barytes, ena ee Omar ea ead aaee Oe cies land and river basins, water resources, extensive canal system Bien Cee ee eeu homeo Pear en Cee eames es Pet eee aaa ce a At current prices, the Gross State Domestic Product (GSDP) of Andhra Pradesh was @ 4,75,859 crore in 2013-14. Between 2004-05 and 2012-13, the average annual GSDP growth rate of Andhra Pradesh was 7.25% while the average per capita income at (current prices) increased from % 46,345 in Pile SRS Lea Andhra Pradesh, over the years, has established a strong Cease uC hCee reece cocieomeaate Pee ee eae MeV ecole and electrical engineering sectors. OCR oa aC EP ae ESP n EL) Crore and for Per Capita Income are % 90,517 (at current prices) Cen Ctr reasa eee Eee tees ery Coreen eee ee) ieee iene er eee one ~ Agro & Food Processing Connon Caer aa ie Ce reine see eens Sees eae Mineral sed indutres eee Processing, Atomobils & Auto Coreen aati ees Co re eeiey Pereyorenateingy ere) eg rey i ary fea eae Mr mace mista een ee or eadena aes ae Industrial development fica a alte me) ole formation, raises wage Lleol Stet 1) At eR aoicesacod tai] about equitable development. Me eR UCC Government has accorded top priority to industrial Fee Bute co) mitigate poverty and Pr acaAndhra Pradesh Industrial Deve daria oe PON Eee Tae Mca c-]ol a) Bae Ci ato promote manufacturing, enhance inclusivity, foster Tatoo Lio Reig-r- 10) Cn MeN iCal rola Ti Ele fel telco CR LLCO Pro eaatiea ete ere eM Ey Clute oe cE the same. The State intends to be the most Pcs Retell Rela soled DMicch racists Tr CO eC a Lie aaa teid eo good law and order and peaceful [ute Weg Cr ee ama industrial policy focuses on creating a conducive eco-system which makes industries based in eae Smtr LN and globally competitive. tan kere lle Mae Ca) (GoAP)lays utmost emphasis on sustdinable industrial development anchored-By capacity building at heaters erage MLN 1 Industral Development Policy 2015-20 | 0902 1. POLICY VISION To make Andhra Pradesh a progressive and highly industrialized state... a State that is a centre of technology and innovation... And, a joyous population confident of its bright future... Hon’ble Chief Minister of Andhra PradeshPOLICY OBJECTIVES a. To ensure sustainable & inclusive industrial growth b. To be among the top 3 states in terms of industrial investments by 2022 |. POLICY TARGETS a. Increase the contribution of manufacturing to GSDP from 9.95% (2013-14) to 15% by 2020 b. Increase the contribution of industries to GSDP from 20.7% (2013-14) to 25% by 2020 IV. POLICY VALIDITY The Policy will be valid for 5 years from the date of notification. . To be the most preferred logistics hub and India’s gateway to East and Southeast Asia by 2029 To enhance the quantum and quality of skilled manpower and create significant employment opportunities .. Attract investment to the tune of & 2 lakh crore by the end of 2020 Create employment opportunities for an additional 10 lakh people by the end of 2020GoAP's strategy of attracting sizeable industrial investment is predicated VISIONARY LEADER 24X7 POWER SUPPL CONDUCIVE BUSIN INDUSTRIAL LAND | FISCAL INCENTIVES PROGRESSIVE LABC & SKILL DEVELOPM ROBUST INFRASTRL EFFECTIVE LAW AN Biotechnology & Medical Equipment) Automobiles & Auto Components [EY B? BXSHIP LY IESS ENVIRONMENT BANK S OUR POLICIES Industrial Development Policy 2015-20 | 13Srikakulam, Guntur & Visakhapatnam Visakhapatnam, East Godavari Anantapur & Chittoor All Distriets 14 | Industrial Development Policy 2015.20, Visakhapatnam, Guntur, Krishna, Anantapur & Kurnool Krishna, East Godavari, Visakhapatnam3 Automobile Hub 4 Cement Plants Nellore & Chittoor Guntur, Anantapur, Kurnool & Kadapa 8 Acros fence Visakhapatnam / Chittoor/ Anantapur Industrial Development Policy 2015-20 | 15Il Land Pooling / Acquisition & Allotment a. Land consolidation: il, the industry is located Consolidation of Industrial in backward areas to be Land will be done by the notified by the Industries & Commerce Government, for Department following the this purpose; state's land pooling / iv. departments, PSUs and acquisition policy. agencies of the Central b. Land allotment: Government; Land shall be allotted on 99 years lease. SIPB may consider outright sale of land in the following cases: v. financial closure of the project requires a sale; vi. projects identified by the Government as i. the investment is critical and prestigious; exceeding % 100 crore; vii. other categories to be ii, the gestation period notified by the of the project is more Government from time than 5 years; to time; Industrial Development Policy 2015-20 | 17GoAP accords highest priority to improving ‘Ease of Doing Business’. DOE ee Ca cea al ene Soc cia eae Cures ea} investor confidence. To that end, the State shall provide both pre and post investment BRC CES RO nur re eu R Ue: RCo Sa Ee eee es) Patra CON ec emacs eee eee cna starting and operating an industry within 21 working days. This platform shall De ey ees SS and pre-operation stage clearances Peees mat ee ad See Can filing and tracking. Seog eee pee Recs ‘Authorities and Nodal Agencies associated with processing Be eae akong ee eee rea oe nei applicable laws & regulations Pee ge ease cae required to set up new industrial units or ee eens oe eee eee Pere eee approvals which require only a scrutiny Bie maa eee oan aa Crs ee eee eee) ea ee ea co Teo Soe ue PCPA ca eas Bora Pree ka self-certification: If select approvals eerie snc kcal tener Renae ae ee) Bearer Ty Pee hee ace ee al See eee ay SUSAR elit eu Cry ea ecg cia) eed Assignment of Inspection to Private re Cree ce Td Cae aed Pee ee aed required to set up new industrial units or expanding existing units, PERS ecu ean) ete ene es Pe cnc ee act technically qualified experts in the Reem Aa cro eee en a ad Parallel Processing of clearances: Cee eee Oe eee Caen eas & clearances, all intra-approval De ee ec e Re eet cea ee clearances has been introduced ee oe ee een paceEASE OF DOING BUSINESS Ill, State Investment Promotion Board (SIPB) Pua} For creating an enabling structure pee eter Pore RCnue tact ops un Rand CeCe RCSLT ar ELT) ee esas MSCS aus ech aL SO rae ae Raa) eC Ia uae eae Cee and for approval of mega projects. . Empowered Committee ROBT curd IN ee Rec cid Secretaries chaired by the Chief eR CR Ace tne eC) Pee aner eat ties a ce ce eka en aCe ed ec goog Leh ee CMe ccna) See cy ili, Implementation of all large/mega ongoing projects Rec R Rurcon sist Pee Scrutiny of all issues/proposals which Dae cna Ae Cae na Cars ese RU g it erg cee ee kee eRe a rs emt else PRU Ca RGR a RO ga Ie cee eee ne See’ Secretary, Environment, Forest, eee ace Secretary, Revenue (LA) Secretary, Revenue (CT) Secretary, Employment & Labour Neem Ly eer) Secretary, Energy & Infrastructure Sea) Ween Daal See) ea Peeters e required on case to case basisGar eure ans le eek ho eRe eu) Pee uel te Caen ct a and PON cl Mice sac ame Cait ser Pee Corie cas b. Promote skill development BOR UE Reece TE eS cg eed GoAP has set up Andhra Pradesh State Skill Development Corporation (APSSDC) on lines of the National Skill Development Corporation (NSDC), ec ciel CUA enc Cal caeES APSSDC will provide funding to build scalable, forprofit vocational training ee eee ence oe cue DCR UL RRR CC ce uC aime te hole Pe cea ey State will identify required quantum of skilled manpower, map industry specific skill sets and provide courses at different levels of ete eet Caen Ea Pee i SE retySCE De aoe Sao ee kan aa approach to facilitate industry wide initiatives aimed at enhancing the employability of unskilled/semi-skilled labour, Sa Ae ee eee ean ‘women, minorities, SC/ST and backward class entrepreneurs. Secterspecific and Market-driven Curriculum De eae hae Ce OC g Sad of skilled manpower. Industries will be involved in drafting training curriculum to make it sector-specific, industry responsive and market Pann Cun eneat ean iene mated at teoue Cet Cntey Sree etic) Due Cn) NSS eC SC Rice hoe ncaa) Sea ae eae arcs Ste availability across multiple skill levels/sectors, demographics and Pree eee rea ore eee ease g Sn ed coordination with Industries and Labour Department. Pon oe con erence cc cee) eee cece eens crs ieee er eae)ae ees)ey Ae coed Andhra PyAdesh has traditionally been one of the favored destinations for oversead investors. The Industrial Policy aims to strengthen this trend and Poe ecUr ceo unnor ein tak acrscs A healthy business environment with predictable and non-discriminatory regime reduces the risk of doing business and is a major contributor to driving foreign investments. The Government is committed to provide ROC noe ee Ree uC tea capital to attract FDI inflows into the state. Following support services will be provided to potential investors by select country specific desks * Provide bespoke investor facilitation * Handholding services in the form of local information and expertise Se ee ro nee came ce SERVICE Pn ee er eedFISCAL INCENTIVES Investors will be eligible for applicable incentives announced by Government of India for setting up industries in the State of AP. GoAP recognizes the need for sector specific fiscal incentives to improve the ‘competitiveness of AP based firms and has made provision for various financial Ce ee RCO eeu eco EO Te Cao ae mentioned in the Industrial Development Policy 2015-20. Eligibility criteria for expansion/diversification projects will be mentioned separately in the guidelines. aes eeste\ceC sa Ca ee’ eee 7 ¢. Mega Industrial Project eee ed eotas =m (MSME): ————__ Projects with an investment = oe feeap ca Cages eta ccd CONICS ero ed pee ce Deena Id CuCl ean Ud Re ee Rae Rae ed seein’ Peed ted Reenter Paty PaO! as textiles, food processing, MSMED Act 2006 RUC RUC os RCA m uC ) (as updated from ment threshold for Se ly time to time) reed eee oe eo Say ea rete ee S ac pS ile ce Feit Doe ea st) eG pote ee nc Cee aed cess different. Kindly refer pore ces Pear ieee) Poca ona Tati eee cea) RCE ol Rane POS aC aaa iy Ree ae fee eee ace aalgtea Matar to the state's industrial growth Geren ctintitem Bmore a etd Pens ogee Cee U ce oa eteTze GoAP is committed to supplying uninterrupted 24x7 quality power to all industries operating in the State Andhra Pradesh is one of the three states selected under the centrally-sponsored "Power For All” scheme. ii, The power capacity allocation to Andhra Pradesh (as on 2nd June 2014) was 8,037 MW. To meet the burgeoning industrial, commercial, stitutional and domestic needs, the state intends to ‘i \dd around 16,484 MW in Deters years ili. GoAP will provide fixed power cost reimbursement @T 1.00 per unit for a period of 5 years from the date of commencement of ‘commercial production. The power cost reimbursement for certain specific sector/sub-sector may be higher. Kindly refer individual sector policies for details.EMT c eri See eS er Roun a od ci Say eee cea Caer cane nny Sear) Sec ena ey Ae Me seme cd and hypothecations will be Pa) Seen a ete only one time on the land. Sn a ec) CO aati ica) COP) oa — CN ec eee eat as of net VAT/CST or SGST will Pee tou ee ee cid SCs Connon ce as Preece mata) Tesco Pee For sector specific industries Te er coy ree carne Rene ony Pag\V.Incentives for MSME GoAP places strong impetus on CoC u aL Ber Cea eo ue] So eee Pec Romeo Pree Roe ec eet cm ec Rr eo eee] VAT/CST/SGST are mentioned below: Pa tig * 100% of stamp duty and transfer Crm auras keL) purchase of land meant for Ren eae) Sec Raa Pet ae Ue ae meee Eee] Duce a ee pe IN de eee em ee ieee ag See tg will not be waived on subsequent Ut CRUE Care) Leech ee eee eee aes ccLar TS reimbursed for a period of 5 years Ce ee Se ect) For medium industries, 75% of net Nec eke a period of 7 years from the date of Sec production or up to realization of See Rey eMac Rae ee Cae ea eur cS Dec e Ere TR CUE Pen aee CENTIVES. 0) 54FSRO) euro eo ONS ne Mees Oe ae Rescate Bee eas eons Cenc ceo acay Cte Rua cecr) Dee SOT a) this industry under zero rated category schedule of the VAT Act. |. GoAP will provide up to 35% subsidy Ce cue aurea Cis Deum tie nd Te RRS Muna LLU) COR et eR a cues PSUR ee esc Pee sce ae LORE) lakh for large enterprises, provided OR ery Gee caso) (APPCB). ees Pees ey measures across industries in Andhra ee cloak ou 19 Pen eel ae RU aa Coco La] eesgeuC NRC a Peach eet) ‘expenses and consultancy fees) for Peeps ecco et Ree eensBR utile eee et nec aca ins and sewage treatment plant and using recycled water for industrial purpose, eee eos Green Buildings: Buildings which Cee eco Lea eo Green Building Council (IGBC/LEED Se RRC aos eee eee as (oe Vee eg or (erecting captive sun, wind and jomass plants etc.) Installing Continuous Emission Pea nen ae] category industries. The information EO ee ec Roa Seg ae) eee canard restoring water bodies by de-stilting CR neat ae aac Ca Pome ee ace pC eco Se ce Ras See Caucus the project. The incentive can be availed only once during the 5 year tenure of the Poa Le RCoat a ane ee eae eeeVI. Special Package of Incentives Government of Andhra Pradesh is fully committed to the well-being of the Socially Disadvantaged Groups viz., the Scheduled Castes (SCs), the Scheduled Tribes (STS) Backward Class (BC) and Women. In order to actively involve them in economic development for inclusive growth, special package of incentives have been proposed. These units should be wholly promoted by SC/ST/BC and Women entrepreneurs, as the case may be. a. Special Package for SC/ST Entrepreneurs The provisions in the package are applicable to those units wherein the sole proprietor belohgs to SC/ST cate- gory. SC/ST entrepreneurs can r, set Up industries covered le list of the policy to avail incentives in this policy. 1. 100% reimbursement of Stamp duty and Transfer Duty paid by the industry on purchase of land meant for industrial use 2. 100% reimbursement of Stamp duty for Lease of Land/Shed/ Buildings and also mortgages and hypothecations 3. 50% rebate in land cost limited to %20 lakh in Industrial Estates/ Industrial Parks 4, 25% Land conversion charges for the industrial use limited to T 10 lakh 5. Fixed power cost reimbursement @% 1.50 per unit for 5 years from the date of commencement of commercial production 6, Seed capital assistance to First Generation Entrepreneurs @ 25% of ‘the Machinery cost, which will be deducted from the eligible invest- ment subsidy 432 | Industrial Development Policy 2015-20 7. 35% investment subsidy on fixed capi- tal Investment by SC & ST Entrepreneurs and additional 10% investment subsidy for SC Women & ST Women Entrepreneurs, with a maximum limit per unit is € 75 lakh (i.e. cla 35% for SC &ST Entrepreneurs and 45% for SC Women and ST Women entrepreneurs). Additional 5% investment subsidy for units set up in Scheduled Areas by ST entrepreneurs, with a maximum limit per unit is 275 lakh Reimbursement of 100% net VAT/ CST/SGST to Micro and Small Enterprises for a period of 5 years from the date of commencement of ‘commercial production 9. Reimbursement of 75% net VAT/ CST/SGST to medium enterprises for a period of 7 years from the date of commencement of commercial production or up to realization of 100% fixed capital investment, whichever is earlier 10. Reimbursement of 50% VAT/ CST/SGST to large enterprises fora period of 7 years from the date of __commer ~~ production or up to realization of fixed capital investment, whichever is11. Interest subsidy on the term loan taken on the fixed capital investment in excess of 3% per annum subject to a maximum reimbursement of 9% per annum for a period of 5 years from the date of commencement of commercial production. This benefit is also applicable to the Service Sector units set up under this policy 12, 50% Reimbursement of cost involved in skill upgradation and training local manpower limited to & 5,000 per person 13. 100% subsidy on the expenses incurred for quality certification/ patent registration limited to % 3 lakh for micro and small enterprises 14, Incentives under Swachh Andhra (Para V) will be applicable for SC/ST entrepreneurs 15. For enterprises set up by SC/ST entrepreneurs, infrastructure like roads, power and water will be provided at doorstep of the industry for standalone units by contributing 50% ofthe cost of infrastructure from IIDE with a ceiling of 21 crore, subject tos a. The location should be beyond 10 Kms from the existing Industrial Estates/IDAs DAs having vacant land/shed for b. Cost of the infrastructure limited to 15% of the eligible fixed capital investment made in the industry. 50% of the cost of infrastructure is raised to 75% in respect of units set up by ST entrepreneurs in Scheduled areas r sector activities. end vehicles (except taxies, lorries, tippers, water tanker etc. meant for self-employment) will not be allowed under the scheme.b. Special Package for BC entrepreneurs The provisions in the package are applicable to those units wherein the sole proprietor belongs to BC category. 1 100% reimbursement of Stamp duty and transfer duty paid by the indus- try on purchase of land meant for industrial use 100% reimbursement of Stamp duty for Lease of Land/Shed/ Buildings and also mortgages and hypotheca- tions 50% rebate in land cost limited to %20 lakh in Industrial Estates/ Industrial Parks 25% Land conversion charges for the industrial use limited to & 10 lakh Fixed power cost reimbursement @ 71.50 per unit for 5 years from the date of commencement of commercial production Seed capital assistance to First Generation Entrepreneurs @ 25% of the Machinery cost, which will be deducted from the eligible investment subsidy 35% investment subsidy on fixed capital Investment by BC Entrepreneurs and additional 10% investment subsidy for BC Women Entrepreneurs, with a maximum limit per unit is 75 lakh (i.e. 35% for BC Entrepreneurs and 45% for BC Women entrepreneurs) 434 | Industrial Development Policy 2015.20 Reimbursement of 100% net VAT/ CST/SGST to Micro and Small Enterprises for a period of 5 years from the date of commencement of commercial production Reimbursement of 75% net VAT/ CST/SGST to medium enterprises for a period of 7 years from the date of commencement of commercial production or up to realization of 100% fixed capital investment, whichever is earlier Reimbursement of 50% VAT/C- ST/SGST to large enterprises for a period of 7 years from the date of commencement of commercial production or up to realization of 100% fixed capital investment, whichever is earlier Interest subsidy on the term loan taken on the fixed capital investment in excess of 3% per annum subject to a maximum reimbursement of 9% per annum for a period of 5 years from the date of commencement of commercial production 50% Reimbursement of cost involved in skill upgradation and training local manpower limited to €5,000 per person13. 50% subsidy on the expenses incurred for quality certification/patent registration limited to €3 lakh for micro and small enterprises. 14. Incentives under Swachh Andhra (Para V) will be applicable for BC | entrepreneurs 15. For enterprises set up by BC entrepreneurs, infrastructure like roads, power and water will be provided at doorstep of the industry for standalone units by contributing 50% of the cost of infrastructure from IDF with a ceiling of 21 crore, subject to: a. The location should be beyond 10 kms. from the existing Industrial Estates/IDAs having vacant land/shed for allotment b. Cost of the infrastructure limited to 15% of the eligible fixed capital investment made in the industry Package for Women Entrepreneurs The following incentives are applicable for ‘Ist generation women entrepreneurs and are applicable for micro and small units only. 1. 25% investment subsidy on fixed capital Investment by women Entrepreneurs, with a maximum limit per unit of 30 lakh 2. Seed capital assistance to First Generation Entrepreneurs @15% of the Machinery cost, which will be deducted from the eligible investment subsidy 3. Allother incentives as per Industrial Development Policy 2015-20GoAP shall handhold setting up of world-class incubation centres to provide much needed thrust to promote startups and cultivate innovative ideas. GoAP will encourage setting up of incubation centres in ‘Smart Industrial Township (SIT), premier educational institutes, Mega Industrial parks and startup villages. Additionally, an incubation centre will be set up in IM Visakhapatnam on PPP basis.Oy PREC Pere (ore rid ° . 7 Gangavaram BENGALURU _ KrishnapatnameReaD Ce ec Le) OCT OTL) Og Conse ea approval for setting up two NIMZs: Cements eer a cet OO cc eS world class industrial regions with each spread over a minimum of 5,000 Dm oa growth nodes for industrial development Sen acu cuca ec Please refer to National Manufacturing Poca ace IV. Information Technology Investment Cee) Sec ee Seer Clas Penny Dement De Rl aaa) Parca eis rien ence] TT a eC Calc ETc ear U ET ice hid services. Such regions could include new integrated townships, SEZs, industrial parks ete. Dae eer Lea) MUR UL Coe Tel eee Cen eat ete ae} (RCs och be a specifically notified investment ed 40 sq.kms planned for IT/ITES and Reais Smart Industrial Township (SIT) GoAP will facilitate setting up of SITs across various districts with local Poem c ay Succ eT eR Ley Pees Retour eee Rn rd preg Peer eR aC PO cE cena ccc ig Pee Rane e connectivity to the nearest railway line and or port CMe CL Rea AOS ere Ceca Bee ech codVI. Special Economic Zones (SEZ) STC sity SEZs aim to provide simplified clearances Tae ea aa and controls, world class infrastructure and Pret Cac alo Ny See eRe ae cacy Cee Reena Nr DC Om UC GES OR cr Rancid NT une cuke aay a ARS Eero nro ac Cen au usa CEI develop new industrial parks and OUR Meta REO une i Re ORC aren ea Pea ae ceGoAP shall frame sector specific policies with a focus on State's position in SUCRE Un Cui em leu ulc sour) strategic importance in socio-economic context. Instruments to facilitate the objectives are sector-specific parks, incentives, simplified clearances and Pea aaa es Note: Incentives mentioned in the Industrial Development Policy 2015-20 Ree ee Re eee eae nee eee