Advantages of Punjab

• Punjab has a 58% literacy rate and the highest per capita income in India.
  
  
• Punjab average growth rate is 10% amongst the highest in the country, reflects the progressive economy of the state.
  
  
• Punjab has become a land of boundless opportunities, offering distinct advantages for investment and industry.
  
  
• Punjab has marked its existence on the global business mainstream, with major players from around the world forming joint ventures in the field of agri-business.
  
  
• Punjab is a land of rivers, fertile soils and steady achievement.
  
  
• The state was the first to translate agricultural technology into the "green revolution", recording highest growth rate in food production.
  
  
• Punjab has over 1.97 lakhs of small and medium industries and about 653 large scale industries.
  
  
• It leads in the manufacture of machine and hand tools; printing and paper cutting machinery; auto parts and electrical switch gear.
  
  
• The state provides more than 75% of the country's requirement for bicycles, sewing machines, hosiery and sports goods. At par with the highest quality standards in the world, these products have carved a niche for themselves in markets across the globe.

Incentives by Punjab Government

Special Package of Incentives for Information Technology Industry:

1. Information Technology
   "IT Software" means any representation of instruction, data, sound or image, including source code and object code, recorded in a machine readable form, and capable of being manipulated or providing inter-activity to a user, by means of an automatic data processing machine falling under heading, 'I.t. Products", but does not include 'non I.T. Product", 'IT Service' is defined as any service which results from the use of any IT Software over a system of IT products for releasing value addition. The IT Industry shall cover development, production and services related to IT Products. The term 'IT-Software' shall be substituted in place of 'Computer Software' In all notifications.
   
   
2. Information Technology Industry
   IT includes IT and Telecommunication; IT Industries includes, IT Hardware and Software Industries; IT Software Industries include IT Software, IT Services and IT enabled services, IT infrastructure means the physical Infrastructure build by a firm or a builder and sold to an IT Industries for its own use or the Infrastructure build by an IT Industry for its own use. List of Industries included in the scope/definition of Information Technology Industries and eligible for incentives under this policy is as per Anneure-1. The list is inclusive and not exhaustive.

The Fiscal Incentives for information Technology Industry:

The following Special Incentive shall be available to the Information technology units set up in the State irrespective of their location:-

1. Investment Incentive
   1. Investment Incentive (Capital subsidy) @ 30% of the Fixed Capital Investment (FCI) to the SSI, large & Medium units subject to maximum of Rs. 50,000 lacs shall be available to the Information Technology units set up in SAS Nagar (Mohali) as well as 'A' Category areas defined under the Punjab Industrial Incentive Code-under the Industrial Policy, 1996.
      
      
   2. Investment Incentives @ 20% of Fixed Capital Investment to the Small, Medium and Large Scale Information Technology units, subject to maximum of Rs. 30 lacs, in 'B' Category areas defined under the Punjab Industrial Incentives Code under the Industrial Policy 1996.

The Total project cost excluding working capital shall include cost of technology acquisition/transfer IPR etc.

2. Exemption / Deferment from Sales Tax
   1. Exemption/deferment from Sales Tax (including Punjab Sales & Central Sales Tax & Purchase Tax wherever applicable) for a period of 10 years.
      
      
   2. After expiry of 10 years sales tax would be charged @ 2% for hardware, 1% for packaged software and 0% for customized software for a period of next five years.
      
      
3. Exemption for Electricity Duty
   All IT units located in the State of Punjab shall be granted exemption from payment of electricity duty for a period of 5 years from the date of release of electricity connection.
   
   
4. Generator Set Subsidy
   All Information Technology units located in the State of Punjab would be eligible for the generating set subsidy @ 25% of the cost of captive generator sets subjects to maximum of Rs. 2.00 lacs.
   
   
5. Subsidy on IT in Gurmukhi Script
   Subsidy shall be admissible to the units engaged in the development of IT in Gurmukhi script amounting to 5% of the total turn over year subject to a maximum of Rs. 5,00 lacs per year for a period of 3 years provided that the number of qualified Information Tecgnology professional engaged on such Project by the unit/institution is more than 10.
   
   
6. Special subsidy for Human Resources Development in Information Technology
   Units exclusively engaged in all or any of the Information Technology activities, except for the institutes exclusively engaged in Human Resources Development (IT Training Institutes), would be eligible for special subsidy for human Resources Development in Information Technology for their employees of Punjab/Chandigarh domiciles amounting to 25% of the cost of such Human Resources Development subject to maximum of Rs. 10.00 lacs per year for a period of five years.
   
   
7. Units going foe expansion
   The Information Technology units going for expansion, diversification or modernisation by increasing investment by more than 25% and increasing the total capacity/production/turn over by more 25% would be allowed incentives at per with new units, on additional fixed capital investment incurred and incremental production as mentioned above.
   
   
8. Exemption from Stamp Duty registration fee
   Property transaction in the designed Information Technology Parks shall be exempted from payment of stamp duty. There shall be no stamp duty on lease and financial instruments of units located in such parks. The maximum registration fee charged from these units shall not be more than Rs. 1000.00.
   
   
   
9. Price and Order Preference
   The Information Technology units located in the State of Punjab shall be given 10% price preferences on application software development for all Punjab Govt. Department, Undertaking/Boards/Institutions etc. IT units located in the State of Punjab would be given preference for order, all other conditions remain the same. This incentive shall be available to only ISO certificated units.
   
   
10. Subsidy on Pollution Control Equipment
    20% subsidy on the cost of pollution equipment for hardware units subject to ceiling of Rs. 5.00 lacs shall be allowed.
    
    
11. Employment to Punjab Domiciles
    The fiscal Incentives mentioned under Rule 2(1) to (X) would be available to such units, which provide minimum 50% of the total employment to persons of Punjab domiciles

Facilitation Service:

1. Automatic clearances from Punjab Pollution Control Board, simplified time bound single window clearance under the other statutory acts of the state and release of electricity connection by Punjab State Electricity Board.
   
   
2. Assured availability of quality power and back up power in the designed Information Technology Parks.
   
   
3. Information Technology Industry, except for the Hardware Industry, shall be permitted in the residential areas and premises. Such industries are to be included in the lists of users permitted in the no-development area of the Punjab Urban Development Authority.
   
   
4. IT Software Industry shall be eligible for Self-Certification/exemption from the purview of:
   1. Factory Act;
   2. Employment Exchange (notification of vacancies) Act;
   3. Payment of wages Act;
   4. Minimum Wages Act;
   5. Contract labour (Regulation and abolition) Act;
   6. Workman Compensation Act;
   7. The Punjab Shops & Commercial Estt. Act;
   8. ESI Act;
      
      
5. General permission to operate three shifts for the It Software Industry and IT enabled service.

The Interpretation/Relaxation/Amendment:

The Secretary Industries & Commerce shall be competent to interpret/relax/amend any of the above provisions under this policy in consultation with the concerned Department/agencies of Government.

Amendments/Modification in the definition of Information Technology Units:

The Committee consisting of the following officers shall be empowered to carry out Amendments/modification (in the list according to the advancement in IT Sector) in the definition of Information Technology Industry/Units to be covered under this policy:

Useful Weblinks

For More Information please visit http://punjabgovt.nic.in/