Capital Investment Subsidy for Establishment of New Hotel or Mini Resort of Standard Category
By Tourism Department, Government of Madhya Pradesh
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Quick Answer
A capital investment subsidy of 15% (up to ₹50 lakh) for establishing new standard hotels or mini resorts in Madhya Pradesh, requiring a minimum ₹2 crore investment.
- Funding amount
- Up to ₹50L
- Funding type
- Subsidy
- Application deadline
- Rolling
- Location
- Madhya Pradesh
About this subsidy
The "Capital Investment Subsidy for Establishment of New Hotel or Mini Resort of Standard Category" scheme, launched by the Tourism Department, Government of Madhya Pradesh, aims to boost the state's tourism infrastructure and promote investment in the hospitality sector. Madhya Pradesh, with its rich cultural heritage, wildlife, and natural beauty, seeks to attract entrepreneurs to establish new hotels and mini resorts of a standard category. This initiative is designed to reduce the financial burden on investors by providing a significant capital subsidy, thereby encouraging the growth of high-quality accommodation options across the state. The scheme specifically targets new establishments, ensuring that the new infrastructure contributes to enhancing the overall tourist experience and capacity within Madhya Pradesh.
This scheme is crucial for fostering economic development and creating employment opportunities within the state, especially for its residents. By incentivizing the construction and operation of new hospitality units, the government intends to make Madhya Pradesh a more attractive destination for both domestic and international tourists. The program is implemented by the Madhya Pradesh Tourism Board, which oversees the application and disbursement process, ensuring compliance with the laid-out guidelines and encouraging sustainable growth in the tourism sector. The focus on fixed capital investment highlights the state's commitment to tangible, long-term infrastructure development.
Eligibility
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Subsidy providers
The Madhya Pradesh Tourism Board is the state's tourism agency. It runs a set of schemes for people building, upgrading or running tourism projects in Madhya Pradesh. Most are capital subsidies for hotels, resorts and tourism infrastructure. The rest cover land and heritage…
Learn moreBenefits & Funding
- Amount
- Up to ₹50L
What You Get
The scheme offers a Capital Investment Subsidy of 15% against the fixed Capital Investment, subject to a maximum ceiling of ₹50,00,000/-. This non-repayable cash benefit significantly reduces the initial financial outlay for eligible units. However, this subsidy comes with specific conditions: if the unit ceases operations within 1, 2, or 3 years from the date of receiving the subsidy, a portion of the amount (80%, 60%, or 50% respectively) must be refunded to the department. This ensures the long-term commitment of the beneficiaries to the state's tourism sector. The subsidy acts as a critical financial incentive to establish high-quality tourism infrastructure.
- Disbursement
- Reimbursement
- Bootstrap friendly
- Yes
Timelines & Process
Applications
Rolling basis
Selection Process
The selection and disbursement process for the Capital Investment Subsidy involves a thorough verification by the Madhya Pradesh Tourism Department or Board. Once the online application for the subsidy is submitted, along with all the required documents, the department undertakes a detailed review. This includes verifying the incurred capital expenditure, confirming the commencement of commercial operations, checking compliance with employment requirements (70% MP residents), and assessing adherence to facility standards (number of AC rooms). Upon successful verification and approval, the subsidy claim is processed, and the capital investment subsidy is disbursed to the eligible unit.
Application Process
- 1
Register on Invest Portal
Applicant registers as a 'Vendor / Investor' on the Madhya Pradesh Government's Invest Portal, providing basic entity and contact details.
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How to apply
Four steps from draft to disbursement — one action each.
- 1
See the questions before you start
Download every question this programme's application form asks, so you can prepare your answers offline before opening the portal.
- 2
Line up your documents
Keep every document from the checklist ready in one folder. Missing docs are the #1 reason applications get bounced.
- 3
Submit on the official portal
Use the official application link and verify all details before final submission.
- 4
Follow up
Reach out 5–7 days after submitting to confirm receipt and ask about the review timeline.
Program templates & documents
Files the program publishes for applicants — download these and apply in the prescribed format.
Frequently Asked Questions
What is the maximum subsidy amount available under this scheme?
The maximum capital investment subsidy available is ₹50,00,000/- (Rupees Fifty Lakhs only), which is 15% of the fixed capital investment.
What are the minimum capital expenditure requirements for eligibility?
Applicants must incur a minimum capital expenditure of ₹2,00,00,000/- (Rupees Two Crores only) as approved by the department to be eligible for the subsidy.
Are there specific room requirements for hotels and resorts?
Yes, new hotels must have a minimum of 25 air-conditioned lettable rooms, and new mini resorts must have a minimum of 10 air-conditioned lettable rooms.
What happens if my unit closes after receiving the subsidy?
If your unit closes within 1 year, 80% of the subsidy must be refunded. If it closes within 2 years, 60% must be refunded, and if within 3 years, 50% must be refunded. Units must operate for at least three years from availing the subsidy.
Is there a deadline to apply for the subsidy?
Applications must be submitted within one year from the date of commencement of commercial operation of the hotel or mini resort. This is a per-unit deadline, not a general program closure date.
What types of organizations can apply?
The scheme is open to various entity types including Public Limited Company, Private Limited, LLP, Proprietorship Firm, Partnership Firm, Cooperative, Trust, FPO, and Individuals establishing new hotels or mini resorts.
Sources
Data on this page is compiled from official program and provider references.
