Gujarat Textile Policy: Payroll Assistance

What is payroll assistance under the Gujarat Textile Policy?

The Gujarat Textile Policy 2024 is an incentive package notified by the Industries and Mines Department, Government of Gujarat, and administered by the Industries Commissionerate and the District Industries Centres. Its operative period is 1 October 2024 to 30 September 2029.

Payroll Assistance is the policy's employment component. Instead of subsidising only machinery, it pays an eligible textile unit a fixed monthly amount for every eligible worker on its rolls, which makes labour-heavy activities such as garmenting viable at scale in Gujarat.

According to the scheme's published benefit table:

Payroll assistance is available for five years from the Date of Commencement of Production (DoCP), and for ten years for labour intensive industries. The higher rate for women is deliberate: the policy's labour intensive category itself is defined partly by a minimum number of female employees.

The wider Textile Policy 2024 also carries capital subsidy, interest subsidy, power tariff subsidy, assistance for quality certification, assistance for saving energy and water, technology acquisition assistance and support to Self Help Groups for job work. Payroll assistance is claimed on the same registration and eligibility certificates as those components.

Who is eligible for Gujarat Textile Policy payroll assistance?

A unit qualifies if:

• It manufactures in an eligible activity: Activity 1 covers garments, apparel and made-ups and technical textiles including composite units; Activity 2 covers weaving, knitting, dyeing and processing, texturising, twisting, embroidery and MMF spinning from polyester or viscose staple fibre. Payroll assistance rates are published for the Activity 1 categories.
• It employs workers who are domiciled in Gujarat and registered under the EPF scheme as a new or existing EPFO subscriber.
• It applies within one year from the Date of Commencement of Production, or from the date of issue of the Government Resolution, whichever is later.
• It meets the policy's general employment condition that at least 85% of total employees, and at least 60% in managerial and supervisory roles, are persons domiciled in Gujarat.
• For the ten-year benefit, it meets the labour intensive test: at least 4,000 EPF-registered persons including at least 1,000 female employees, for a new unit; or that much wholly new employment created by an existing unit through expansion or diversification.

Who cannot apply, and what is not counted:

• Individual workers cannot apply. The assistance is paid to the unit against its payroll; there is no personal benefit an employee can claim.
• Account, administration and marketing staff are not eligible workers, so their salaries do not attract assistance.
• Workers domiciled outside Gujarat are not eligible, and neither are workers who are not registered under EPF.
• A unit that has availed EPF reimbursement under any Central or State Government scheme for a period is not eligible for payroll assistance for that same period.
• Units availing incentives under this policy cannot claim benefits under any other State Government scheme. Central government scheme benefits are allowed, but combined State and Central incentives must not exceed the eligible Fixed Capital Investment.
• Trading and service activities are outside the policy, which covers manufacturing, production, processing and job work in the listed activities.
• Investments for renovation, rehabilitation or rationalisation by an existing unit do not qualify for incentives under the policy.

The 31 January 2026 amendment changed one important boundary. Earlier, an industrial undertaking inside a Municipal Corporation limit was not eligible. After the amendment, undertakings inside a Municipal Corporation limit that are engaged in non-polluting activities such as garment, apparel and made-ups, stitching and embroidery, falling under the GPCB Green or White category or equivalent, are eligible for incentives under the policy.

What documents are required?

How to apply for Gujarat Textile Policy payroll assistance

1. Apply for registration to the Industries Commissioner in the prescribed format, downloadable from ic.gujarat.gov.in, within one year of the first term loan disbursement, the commencement of commercial production, or the effective date of the policy, whichever is later.
2. Attach the registration checklist documents: constitution and IEM, land possession with NA permission or GIDC possession letter, GPCB Consent to Establish if applicable, the Detailed Project Report, the term loan sanction letter, board resolution, PAN, GST registration and the first sale bill if production has begun.
3. Collect the Registration Certificate, issued by the Industries Commissioner after scrutiny and verification.
4. Apply for the Provisional Eligibility Certificate (PEC) after the DoCP, to the correct authority for your size: the General Manager, District Industries Centre for MSME units with GFCI up to Rs 10 crore; the MSME Commissioner for MSME units above Rs 10 crore and up to Rs 50 crore; and the Industries Commissioner for units above Rs 50 crore. File within one year of DoCP or of the registration certificate, as applicable.
5. File the payroll assistance claim with the prescribed employment details showing each eligible worker's EPF registration and Gujarat domicile. On PEC, 50% of the claim amount is disbursed.
6. Apply for the Final Eligibility Certificate (FEC) once investment is complete — directly, if the whole investment is done at the time of application, or within one year of the last date of the investment period. After the FEC, the remaining 50% is restructured and disbursed in six half-yearly instalments.
7. Submit offline where the online module is not yet operational. The guidelines expressly permit hard-copy submission at the Industries Commissionerate or the District Industries Centre, and such applications are processed offline.

How is payroll assistance disbursed?

Payroll assistance is not paid as a lump sum on approval. The guideline sets a two-stage flow: 50% of the claim amount against the Provisional Eligibility Certificate, and the balance restructured after the Final Eligibility Certificate into six half-yearly instalments. For labour intensive industries there is an additional gate; payroll assistance is disbursed only after the unit has met the minimum employment criteria, that is 4,000 EPF workers with at least 1,000 women.

Why payroll claims get reduced or rejected

• Late application. The eligibility period is cut by the delay between DoCP and the actual date of submission, and the incentive period starts only from the actual submission date.
• Workers not EPF-registered, or registration gaps in the months claimed.
• Non-domicile workers claimed. Only Gujarat-domiciled workers count, and the unit must separately meet the 85% domicile condition overall.
• Ineligible staff categories claimed, such as accounts, administration and marketing staff.
• Double-dipping on EPF. Any period covered by a Central or State EPF reimbursement is excluded from payroll assistance.
• Production shortfall. After three years from the end of the eligible investment period, average production over three consecutive years must be at least 50% of installed capacity; a shortfall reduces that year's incentive proportionately, and three consecutive years below the line stop incentives until production recovers, with no arrears.
• Breach of policy conditions, which triggers recovery of disbursed incentives as arrears of land revenue with interest at 18% per annum from the date of first availment, and forfeiture of undisbursed amounts.

Help and where to apply in person

• Industries Commissionerate: Block No. 1, 2nd Floor, Udyog Bhavan, Gandhinagar 382 010. Phone 079-23252683 / 079-23252617, email iccord[at]gujarat[dot]gov[dot]in.
• District Industries Centre: the filing authority for MSME units with GFCI up to Rs 10 crore; the district-wise list is published on ic.gujarat.gov.in.
• Policy page: ic.gujarat.gov.in/gujaratextilepolicy2024.aspx hosts the policy, the guidelines, the 31 January 2026 amendment and every registration, PEC and FEC form and checklist.

Every form and checklist referred to here is free to download from the Industries Commissionerate website, and no intermediary is needed to file a claim.