List of Subsidies by the Indian Government
The subsidy mainly reinforces some particular sectors of the country’s economy. It assists growing industries by reducing the burdens charged to them and encouraging innovation. The subsidy is used to provide benefits directly or indirectly to a person, a business, any organization, or any community in India. The subsidy is provided mainly by the central government to overcome some types of burden or overall public interest as well as to promote socio-economic policies. There are so many subsidy-related schemes introduced by the government of India in previous years..
Which is introduced in the financial budget from the food department & public distribution to fulfill the difference between the cost of the economy of food seeds and their sales realization. This subsidy was mainly introduced to FCI for the acquisition and distribution of wheat and rice under TPDS and for maintaining a buffer stock of food seeds for security.
Fertilizer subsidy (Nutrient based subsidy, Urea subsidy)
Fertilizer subsidy is mainly used for agricultural users to provide quality fertilizer at below the market rate.
Petroleum product subsidies mainly LPG & Kerosine and poor households mostly benefited from this (Pradhan Mantri Ujjwala Yojana). They can easily use petroleum products for their daily uses.
There are so many subsidies introduced by the government providing short-term credit for farmers, Bank interest subsidies for home lone holders, Interest subsidies for senior citizen’s LIC pension plans, Credit link subsidies for Economically backward sections and lower range of income groups, Subsidy for National electricity fund, etc.
Indian Government Business subsidies in 2023
Previous financial year government introduced so many subsidies in the business (for large as well as small) sector & other sectors.
The government introduced the Pradhan Mantri Mudra Yojana introduced in 2015 for micro & small enterprises for the growth of the business. Through this scheme, the government provides up to 10 lacks to establish any start-up business in any trading, manufacturing & service sector. In the last financial year govt. disbursed near about 453567Cr. under this scheme. By implementing the policy the contribution of small entrepreneurs to the economy is remarkable in the last few years and it created much more job opportunities in the country.
For technology, upgradation & Integrated development fund scheme & upgradation of plain power looms which is under the ministry of Textiles & this is the one-time subsidy for silk, jute & garments sector on capital for investments in technology up gradation & employment given promotion and substitution of exports and imports. This scheme provides up to 30% of the cost of plant & machinery as well as govt. provide a certain percentage of subsidy (For general 50% for SC 75% & SC 90%) to upgrade manual old power looms to automatic or semi-automatic which is introduced in 2017 to enhance the productivity range & delivery capacity of textile industries.
Subsidy for leather industrial development which is under the Ministry of Commerce & Industry of Leather Export & DPIIT decides to invest a large amount of capital for the promotion of leather sectors.
Subsidy on capital for upgrading the quality in the technology sector which is under the ministry of MSME & the scheme brings to facilitate the up gradation of technology of Micro and small enterprises, Govt. has decided to grant 15% as a subsidy of total establishment cost & the purchase price cost of raw material for the improvement of technology. Both new & existing enterprises may be proprietorships, partnerships, or private limited firms in semi-urban or rural areas belonging to these subsectors can avail of the subsidy by applying through the proper channel. For the awareness programs of the organization government also declared to provide 75% of the actual cost. For implementation of technology regarding energy efficiency they are payable up to 25% of the project cost. According to the revised scheme government also mentioned providing an extra 10% subsidy for entrepreneurs who belong to Schedule Cast & Schedule Tribe categories. This is a valuable step for the new generation by the government for the expansion of the business market.
Subsidy for small businesses for the cold chain which is under the Ministry of food processing Industries aims to impact the cold chain and maintain the preservation infrastructure which is involved in horticulture, meat, organic products, poultry, etc., Subsidy for Entrepreneurial and managerial development of SMEs.
Market Development Scheme for Micro & Small manufacturing enterprises which is launched to encourage the small & micro exporters to expand their business and develop overseas markets properly. To enhance the export trading business government provide 75% of to and fro airfare for the participant at national & International trade fare as well as provide 25% of costs for producing publicity material.
Prime Minister’s Employment Generation program is the most innovative idea to create vast job opportunities for the new generation and boost the overall socio-economic growth in the country. Through this scheme, most of the new generation can start their startup in different sectors. This program is implemented by KVIS which is functioning at the national level. Any Individuals aged more than 18 years may apply for their innovative business ideas to implement in manufacturing sectors (10 Lakh) or other service sectors(5 Lahks).
For the promotion & branding of Rural Industry & Entrepreneurship as well as there have some subsidy schemes for scheduled castes & scheduled tribe casts look like the Stand-up India scheme which is the most innovative scheme launched to provide proper financial support for SC & ST casts by proving the loan between 10 lakh to 1 Cr for startup the Greenfield project. This project may run in any sector like manufacturing, trading, or agriculture. Second, is the Term loan subsidy which is applicable for micro & small enterprises and specially introduced for the sc and st categories to provide a term loan of up to 95% of the total cost of the project as well as the applicant is eligible to get a subsidy up to ten thousand or 50% of the unit cost (Chaturvedi et al., 2022).
Business ideas with Govt. subsidies list
For the proper establishment of any business, funding is the main course & the government has introduced so many schemes which are highly appreciable for start-up business and it is also helpful to the uniform growth of the economy of the country. Here are some start-up ideas which are covered by the above scheme (Ismer et al., 2023).
The government provides a subsidy for the Curry & rice powder business (The applicant gets a loan of about 3.32 lakh with low-interest rate), the Papad business (Govt. provides a subsidy of 1.91 lacks under the entrepreneur support scheme), the wooden furniture business (get capital loan 1.68 lacks under mudra scheme), Light engineering firm (Govt. provide a subsidy of 2.21 lakh under the mudra yojana), computer parts assembling business.
Govt subsidy loan for business:
Now-a-day, 40% of GDP is small as small and medium enterprises used to contribute a lot at least in India. Though it is a very important sector may be due to this it used to face lots of competition mainly from those businesses which are funded privately.
Because of this, so many loan schemes have been introduced by the GoI. mainly to the sector of small business. It always helps to expand the overall business as well as equipment purchases. A few examples of such loans are PMMY (Pradhan Mantri Mudra Yojana) where no deposition of any security need to be submitted as well as loans are available for young generations for their development, Bank Credit Facilitation Scheme where in the form of capital for work are available from the bank. Normally, the industries related to the business of small scale controlled it. Though a maximum of 15 lakhs can be borrowed under such schemes of subsidy. It has been noted that the computer business, and curry powder business has remained the most profitable one. Such innovative idea has increased the business overall (Wu, et al., 2022). Electric vehicles have been introduced from time to time (Jain et al., 2022). Even it has been found that India has overcome the biomass barrier regarding energy (Irfan et al., 2022; Singh et al, 2021). It has been analyzed and found that banks viz., SBI, HDFC, Kotak, and Bandhan Bank used to provide such loans with lots of ease only after the verification of KYC documents.
Sc/st subsidy loans for business:
As such subsidy loans not only assist normal people but also help in their upliftment regarding their lifestyle as well as overall growth. In addition, there is so much assistance that any sc/st person used to get around 25k/financial year. There are so many different kinds of special schemes out there only applicable to sc/st such are Swachta Udyami Yojana (SUY), and special credit subsidy loans available for these classes of people for their overall development. Different sorts of entrepreneurship programs have been launched from time to time (Naik & Patel, 2022). So many small subsidy schemes are available only for sc/st women now-a-day (Vijayran, 2022). From time to time different kinds of new technology have been introduced for such above purposes (Varshney et al., 2022). There is a hub only for these people where they used to get full assistance regarding entrepreneurship only for sc/st. In addition to that, technological upgradation, as well as capacity enhancement, have been so innovative ideas taken by the Government of India. Active participation has been done by the central ministries along with the state and DICCI. In Karnataka, the maximum subsidy for sc/st has been increased to around 3.5 lakhs. Moreover, now another exceptional scheme has been introduced which is known as the laptop scheme only for these classes of people for their overall growth and development, and for this purpose around 300 crores have been implemented. So, it can be said that such a subsidy definitely used to help a lot.
Wu, Z., Fan, X., Zhu, B., Xia, J., Zhang, L., & Wang, P. (2022). Do government subsidies improve innovation investment for new energy firms: A quasi-natural experiment of China’s listed companies. Technological Forecasting and Social Change, 175, 121418.
Jain, N. K., Bhaskar, K., & Jain, S. (2022). What drives adoption intention of electric vehicles in India? An integrated UTAUT model with environmental concerns, perceived risk and government support. Research in Transportation Business & Management, 42, 100730.
Irfan, M., Elavarasan, R. M., Ahmad, M., Mohsin, M., Dagar, V., & Hao, Y. (2022). Prioritizing and overcoming biomass energy barriers: Application of AHP and G-TOPSIS approaches. Technological Forecasting and Social Change, 177, 121524.
Naik, A., & Patel, P. (2022). Government Schemes for Entrepreneurship Programs. In Agricultural Microbiology Based Entrepreneurship: Making Money from Microbes (pp. 25-40). Singapore: Springer Nature Singapore.
Vijayran, M. (2022). Impediments encountered by Women Entrepreneurs in India: An Overview.
Varshney, D., Mishra, A. K., Joshi, P. K., & Roy, D. (2022). Social networks, heterogeneity, and adoption of technologies: Evidence from India. Food Policy, 112, 102360.
Singh, V., Singh, V., & Vaibhav, S. (2021). Analysis of electric vehicle trends, development and policies in India. Case Studies on Transport Policy, 9(3), 1180-1197.
Chaturvedi, B. K., Nautiyal, A., Kandpal, T. C., & Yaqoot, M. (2022). Projected transition to electric vehicles in India and its impact on stakeholders. Energy for Sustainable Development, 66, 189-200.
Garg, A. (2022). Accelerating Finance to help India Achieve its Renewable Energy Goal. Available at SSRN 4020221.
Ismer, R., van Asselt, H., Haverkamp, J., Mehling, M., Neuhoff, K., & Pirlot, A. (2023). Supporting the Transition to Climate-Neutral Production: An Evaluation Under the Agreement on Subsidies and Countervailing Measures. Journal of International Economic Law.