Gujarat Textile Policy: Assistance for Saving in Consumption of Energy and Water

What is the energy and water saving assistance under the Gujarat Textile Policy?

The Gujarat Textile Policy component for saving in consumption of energy and water sits inside the Scheme for Assistance to Strengthen Specific Sectors in the Textile Value Chain, notified by the Industries and Mines Department, Government of Gujarat through Government Resolution No. TEX/102018/3327/CH dated 10 January 2019. The resolution was issued under the strategy of the Gujarat Industrial Policy 2015 and states its operative period as 4 September 2018 to 31 December 2023.

Within that resolution, the component is Scheme 3, formally titled Assistance for Energy and Water Conservation and Environment Compliances. The resolution describes it plainly: the scheme will be known as assistance for energy conservation, water conservation and environmental compliance, and an existing enterprise in operation for more than three years shall be eligible.

Quantum of assistance, as stated in the resolution:

• 20% of the cost of machinery and equipment, maximum up to Rs 30 lakh, applicable separately in each case of energy conservation, water conservation and environment compliance.
• 50% of the fee paid towards an energy audit or water audit, up to a maximum of Rs 1 lakh, applicable separately in each case of audit.

Two further conditions define the shape of the benefit. The enterprise is eligible for the incentive once in two years of the operative period, and investment or expenditure incurred for mandatory compliance is not eligible.

Gujarat is the largest producer of manmade fibre, synthetic fabric and denim in India and, according to the preamble of the same resolution, contributes about 12% of the country's textile exports. Wet processing, dyeing and denim finishing are among the most water- and energy-intensive operations in Indian manufacturing, which is why a conservation-specific incentive exists alongside the policy's capital subsidy, interest subsidy and power tariff subsidy.

Note on the newer policy: the Gujarat Government announced a Textile Policy 2024 on 15 October 2024, which again lists assistance for reducing energy and water consumption alongside quality certification and technology acquisition support. The full resolution for that policy was not published on the Industries Commissionerate or Investor Facilitation Portal policy pages at the time of writing, so the specific percentages and ceilings for the 2024 version are not stated on this page. Applicants should confirm with the Industries Commissionerate which resolution governs their file before committing spending.

Who is eligible for the energy and water conservation assistance?

You can claim it if:

• Your enterprise is a legal entity. A company registered under the Companies Act, a partnership firm, an LLP, an industrial cooperative society or a proprietary concern, engaged in manufacturing, production, processing or job work of an activity covered by the resolution's textile value chain paragraph.
• Your enterprise is an existing enterprise in operation for more than three years.
• The investment is in machinery and equipment for energy conservation, water conservation or environment compliance, and is voluntary rather than mandated.
• The audit whose fee you are claiming is a genuine energy audit or water audit.
• Your assets are new, not second hand, and were purchased from a manufacturer or authorised dealer registered under GST, as the resolution's general conditions require for incentive-eligible assets.
• Your enterprise observes pollution control measures prescribed by GPCB or another competent authority.

You cannot apply, or are not eligible, if:

• Your unit has been in operation for three years or less. This component, unlike the capital and interest subsidy components, is closed to new enterprises.
• The spend is for mandatory compliance. An effluent treatment upgrade ordered by a regulator, for example, is excluded.
• You are claiming a second time within two years of an earlier claim under the same component.
• The machinery is second hand, or bought from an unregistered dealer.
• Your workforce does not meet the domicile condition: at least 85% of total manpower and at least 60% of supervisory and managerial staff must be domiciled in Gujarat.
• You are not prepared to remain in production for 10 years from the date of commencement of commercial production, which the resolution requires of enterprises availing its incentives.

What documents are required?

How to apply for assistance for saving in consumption of energy and water

1. Get the audit done first. Commission an energy audit or a water audit and obtain a written report with the auditor's recommendations. Both heads of the component key off this document.
2. Implement the recommended measures, buying new machinery and equipment from a manufacturer or authorised dealer registered under GST, and keep every invoice and payment record.
3. Prepare the application with the audit report, the audit fee invoice, the machinery invoices, the CA-certified expenditure statement and proof that the enterprise has been in operation for more than three years.
4. File it with the right office. Under the resolution, the District Industries Centre decides applications in the case of MSMEs and the Industries Commissioner decides in the case of large enterprises. The resolution provides that the deciding office shall take a decision on the application within 30 days. Incentive applications under Gujarat's industrial schemes are filed through the Investor Facilitation Portal at ifp.gujarat.gov.in.
5. Respond to scrutiny and site inspection. Officers verify that the equipment installed matches the audit recommendation and that the spend was not for mandatory compliance.
6. Receive the reimbursement in the enterprise bank account after sanction.

How to check the status of a textile incentive application

1. Sign in to ifp.gujarat.gov.in with the login used to file the incentive form.
2. Open the incentives dashboard and search by application number.
3. Read the stage displayed — submitted, scrutiny, query raised, sanctioned or disbursed.
4. For an MSME file pending beyond 30 days, contact the General Manager of your District Industries Centre; for a large-enterprise file, contact the Industries Commissionerate on +91 79 23252619.

Why claims under this component get rejected

• Enterprise too young. Under three years in operation is the most common disqualification, and it cannot be cured.
• Mandatory compliance spend. Anything installed because a regulator ordered it is struck out.
• No audit report, or an audit done after the equipment was already bought, which breaks the link between recommendation and investment.
• Second-hand machinery or purchases from an unregistered dealer.
• Claiming twice inside two years, against the once-in-two-years rule.
• Domicile condition not met on the 85% manpower or 60% supervisory thresholds.
• Filing under the wrong resolution. A unit whose spend falls after 31 December 2023 needs to establish which policy currently governs it.

Where to get help

• Industries Commissionerate, Udyog Bhavan, Sector 11, Gandhinagar 382017 to +91 79 23252619, +91 79 23252689, +91 79 23252682.
• Email: icim@gujarat.gov.in, icioim@gujarat.gov.in, and the general coordination address iccord@gujarat.gov.in published on the Commissionerate website.
• General Manager, District Industries Centre in your district, for MSME applications and first-level guidance.
• Investor Facilitation Portal, ifp.gujarat.gov.in, which hosts the textile scheme resolutions and the incentive application forms, and carries a grievance redressal module.

Applying is free. No official charges a fee to receive an application, and no consultant can guarantee a sanction under a state incentive scheme.