The Employment Incentive is a component of the comprehensive scheme “Motivation of Entrepreneurs to Start Industries and Fiscal Assistance to Industries – Various Incentives” launched by the Industries and Commerce Department, UT of Puducherry. Operational since 1st April 2017, the scheme offers wage/employment subsidies to industries that create jobs for local residents and contribute to economic development in the Union Territory.
Scheme Key Highlights (Short Summary)
• Launched by: Industries & Commerce Department, Puducherry
• Type of Support: Wage/Employment Subsidy
• Effective Date: From 1st April 2017
• Coverage Region: All four regions of the UT – Puducherry, Karaikal, Mahe, Yanam
• Target: Micro, Small, Medium, and Large Enterprises
• Duration:
• 5 years for Puducherry and Karaikal
• 7 years for Mahe and Yanam
• Mode: Offline application
Benefits
• 20% subsidy on wages/salaries of workers covered under Provident Fund (PF)
• Maximum annual limit: ₹5,00,000
• Disbursal:
• Through financial institutions/banks (for financed units)
• Directly to entrepreneur/unit (for self-financed units)
• Disbursed in single or multiple installments depending on fund availability
Eligibility
• All Micro, Small, Medium, and Large industries
• Must have made investment on or after 1st April 2017
• Must provide direct employment to at least 10 persons
• At least 60% of total workforce must be from Puducherry UT (to be maintained during the entire period)
• Workers must be covered under PF scheme
• No transfer/disposal of fixed assets (including plant & machinery) for 5 years from application/disbursement
• Additional investments post-first claim are eligible up to the ceiling limit
Special Provision:
• Enterprises with common ownership are eligible separately if they are at different locations and registered independently
Exclusions
• Units that have already availed investment subsidies from Central/State Governments for the same investment
• Units using second-hand/imported machinery are not eligible
Application Process
Offline
• Step 1: Download and fill the application form from the Official Website of Directorate of Industries & Commerce
• Step 2: Attach all required documents (self-attested, if needed)
• Step 3: Submit the signed application form to the concerned authority
• Step 4: Collect an acknowledgment receipt with date/time and application number
Post-Application Process
• Step 1: Applications are scrutinized by the Directorate of Industries
• Step 2: Eligible cases are placed before the State Level Committee
• Step 3: Based on the Committee’s recommendation, eligible subsidy is sanctioned
Application Deadline
• New Units: Apply within 1 year from production commencement or registration
• Existing Units: Apply within 1 year after expansion, diversification, or modernization
Documents Required
• Entrepreneurs Memorandum Part-2 (UAM/PMT)/Production Certificate
• Loan Sanction Letter
• Invoices for Plant & Machinery, Pollution Equipment, Generator
• CA Certificate for fixed assets investment
• Interest Paid Statement & No-Due Certificate (from financing institutions)
• List of employees covered under PF with salary details
• PF Remittance details for the claiming period
• Notarized Affidavit
• Any additional documents requested by the department
Frequently Asked Questions (FAQs)
Q: What is the employment requirement under this scheme?
A: At least 10 employees, with 60% being residents of Puducherry UT.
Q: What is the maximum subsidy amount available?
A: ₹5,00,000 per annum.
Q: Who is eligible for the subsidy disbursement?
A: Both financed and self-financed industrial units, as per the mode of investment.
Q: How long is the benefit period?
A: 5 years for Puducherry & Karaikal; 7 years for Mahe & Yanam.
Q: Can second-hand machinery be used under this scheme?
A: No, only new machinery is permitted.
Q: Is subsidy applicable for the same investment if assistance was taken from another government scheme?
A: No, duplication of benefits is not allowed.
Q: How is the subsidy paid for bank-financed units?
A: Through the financing bank/financial institution for adjustment against loan or working capital.
Q: How is the subsidy paid for self-financed units?
A: Directly to the unit/entrepreneur’s account.
Q: Can one entrepreneur apply for more than one unit?
A: Yes, if units are at different locations and registered independently.
Sources and References
• Guidelines
• Application Form & Documents Required
• Grievance Redressal
• Helpline