Interest Subsidy (For Micro, Small, Medium and Large New Industries)
By Industries and Commerce Department, Government of Puducherry
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Quick Answer
Puducherry UT interest subsidy of up to 25% (max ₹5 lakh/annum) for micro, small, medium and large industrial units on loans for fixed assets and working capital.
- Funding amount
- Up to ₹5L
- Funding type
- Subsidy
- Application deadline
- Rolling
- Location
- Puducherry
About this subsidy
Micro, small, medium and large industrial units in Puducherry UT that take a loan from a financial institution for fixed assets or working capital can get an interest subsidy of 25% of the annual interest paid, up to ₹5,00,000 a year. The scheme has been in effect since April 1, 2017, under the Industries and Commerce Department.
Units must have invested on or after April 1, 2017, and must give at least 60% of employment to residents of Puducherry UT.
The subsidy runs for 5 years in Puducherry and Karaikal and 7 years in Mahe and Yanam, from the start of commercial production. Fixed assets acquired under the scheme cannot be transferred or disposed of for 5 years.
Eligibility
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Subsidy providers
Benefits & Funding
- Amount
- Up to ₹5L
What You Get
- Subsidy: Up to 25% of the annual interest amount paid, with a ceiling of ₹5,00,000 per annum.
- Admissibility: The subsidy is admissible from the date of commencement of commercial production.
- Period: The benefit is available for 5 years for units in Puducherry and Karaikal, and for 7 years for units in Mahe and Yanam.
- Disbursement: The subsidy is disbursed through the financial institution in single or multiple installments, depending on fund availability. This fiscal assistance directly reduces the interest burden on loans taken for fixed assets and working capital, enhancing the viability of industrial projects.
- Disbursement
- Reimbursement
- Bootstrap friendly
- Yes
Timelines & Process
Applications
Rolling basis
Selection Process
Applications undergo scrutiny by the Directorate of Industries, which evaluates them on merit to determine the admissible subsidy amount. The recommendations are then presented to the State Level Committee. This committee will delve into the merits of each case to ascertain if the unit qualifies for the incentive/subsidy and will subsequently recommend the precise quantum of incentive or subsidy admissible to the unit.
Application Process
- 1
Download Application Form
Download the prescribed application form from the Directorate of Industries and Commerce, Puducherry website.
You - 2
- 3
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- 5
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 purpose of the Interest Subsidy Scheme?
The scheme aims to motivate entrepreneurs to start new industries and provide fiscal assistance to existing ones by offering an interest subsidy on eligible loans taken for fixed assets and working capital, thereby fostering industrial growth in Puducherry.
What is the maximum interest subsidy an industrial unit can receive?
Units are eligible for an interest subsidy up to 25% of the annual interest amount paid, with a financial ceiling of ₹5,00,000 per annum.
How long is the interest subsidy provided?
The subsidy is provided for a period of 5 years for units located in Puducherry and Karaikal, and for 7 years for units in Mahe and Yanam.
Are existing industrial units eligible for this scheme?
Yes, existing industrial units making additional investments for expansion, diversification, or modernization are also eligible for the subsidy up to the specified ceiling limit.
What is the local employment requirement for eligible units?
Industrial units must provide at least 60% of employment to residents of the Union Territory of Puducherry, and this percentage must be maintained throughout the subsidy period as specified in the Affidavit.
How is the subsidy disbursed to eligible units?
The interest subsidy is disbursed through the financial institution from which the industrial unit has availed the eligible loan, either in single or multiple installments, subject to fund availability.
