Uttar Pradesh Electronics Manufacturing Policy 2020

This policy is issued by the Government of Uttar Pradesh through the Department of IT & Electronics, and the nodal agency U.P. Electronics Corporation Ltd. (UPELC). The purpose of the policy is to make Uttar Pradesh a preferred destination for Electronics System Design & Manufacturing (ESDM) by offering favourable incentives, infrastructure and a supportive ecosystem. As an MSME or start-up thinking to invest in electronics manufacturing (mobile phones, IT hardware, consumer electronics, components, repair/rehab units, etc.), your business can qualify for a range of subsidies, exemptions and support under this policy.

Key Features
Financial Assistance
Eligibility Criteria
Documents Required
Application Process for the Scheme

Key Features

Capital subsidy of up to 15%: If your unit invests in fixed assets (machinery, plant, equipment) under the policy, you may get reimbursement of up to 15% of that investment. For example, if you invest INR 100 crore, you may be eligible for INR 15 crore subsidy (subject to other conditions).
Additional 10% capital subsidy for large investments: For mega-units investing over INR 1,000 crore, the policy allows an extra 10% subsidy on the amount above that threshold (thus potentially up to 25%). This encourages bigger players and anchor units.
Refurbished plant & machinery up to 40% of FCI: To encourage rehabilitation and reuse of existing equipment (especially by MSMEs), the policy allows refurbished machinery (not always brand-new) to form part of eligible investment up to 40%. This lowers cost entry.
Interest subsidy of 5% per annum: If you take a loan for eligible investment (up to certain caps), the state reimburses 5% of the interest you pay per annum, for a specified number of years. This reduces your cost of borrowing.
100% Stamp Duty Exemption: On land purchase or lease for setting up an eligible electronics manufacturing unit (or an EMC), you don’t pay stamp duty, reducing your upfront transaction cost.
Land purchase rebate in certain backward regions: If you set up unit in Bundelkhand or Purvanchal, you get a higher land rebate (50%) compared to more developed regions (25%). This incentivises investment in less developed zones.
Electricity duty exemption/rebate: Since power cost is a major operating expense, the policy gives electricity duty relief (percentage and duration may vary by region) to eligible ESDM units, improving competitiveness.
Establishment of Electronics Manufacturing Clusters (EMCs): Rather than scattered units, the policy envisions three major EMCs (for mobile phones, consumer electronics, defence/medical electronics etc) to provide plug-and-play infrastructure, shared facilities, and attract large investment.
Investment & employment targets: The policy sets a clear target of approx. INR 40,000 crore investment and 4 lakh jobs, signalling scale and ambition, giving you confidence of ecosystem growth.
State-wide coverage with regional focus: Unlike earlier policies limited to certain zones, this policy covers the entire state of Uttar Pradesh, and gives attractive incentives for backward regions (Bundelkhand, Purvanchal). Thus your unit may benefit if located in these areas as an MSME/start-up.

Financial Assistance

Component	Assistance Provided	Detailed Explanation & Example
Capital Subsidy	Base 15% of Fixed Capital Investment; Additional 10% for investment over INR 1,000 crore	Example: Your unit invests INR 1200 crore. For the first 1000 crore you get 15%, i.e., 150 crore; for the additional 200 crore you get extra 10%, i.e., 20 crore. Total ~170 crore subsidy (subject to caps)
Interest Subsidy	5% per annum on loan interest for approved units for specified period (e.g., up to 7 years)	Example: If your unit takes a loan and pays interest of INR 2 crore per annum, 5% of that (i.e., INR 10 lakhs) may be reimbursed annually (subject to maximum).
Stamp Duty Exemption	100% exemption on stamp duty for land purchase/lease for eligible ESDM units or EMCs	Example: If land transaction stamp duty would have been INR 1 crore, you pay zero.
Land Subsidy/Rebate	25% rebate in Madhyanchal/Paschimanchal; 50% in Bundelkhand/Poorvanchal on state-agency land purchase	Example: If land cost from state agency is INR 50 crore in Bundelkhand, you pay only 50% i.e., 25 crore (saving 25 crore).
Electricity Duty Exemption/Rebate	Up to 50% (or more for backward regions) exemption on electricity duty for up to 10 years for ESDM units	Example: If your annual electricity duty is INR 5 crore, and you get 50% exemption, you save INR 2.5 crore per year for the defined period.

Eligibility Criteria

Who can apply :

ESDM (Electronics System Design & Manufacturing) units located anywhere in Uttar Pradesh.
New units or existing units undertaking expansion/diversification/technology-upgradation (subject to policy clauses).
Investment must meet certain thresholds for some incentives (e.g., higher subsidy for units investing over INR 1,000 crore).
Units located in backward areas (Bundelkhand, Purvanchal) may qualify for higher benefits.

Who cannot apply :

Units not engaged in manufacturing (e.g., only trading).
Units not meeting conditions of investment, employment, technology, or location as stipulated.
Units outside the policy area or that start beyond policy validity without proper approvals.

Documents Required

Company/firm registration (Udyam/MSME or other), PAN, GST as applicable.
Detailed Project Report (DPR) including cost, technology, location, employment plan.
Land ownership/lease deed or allotment letter.
Bank sanction letter or fund tie-up document.
Technical specifications (machines, refurbished equipment if any).
Employment projection and commitment (jobs to be created).
Proof of domicile/location if in priority region.
Patent filing proof (if applicable for claim).
Environmental/clearances if required under state policy.

Application Process for the Scheme

Option 1: Apply with Bullit (Recommended)

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Option 2: Online Application via Nivesh Portal

Visit the official portal of the Government of UP [Invest UP – Electronics Manufacturing Policy 2020] and register your project.
Upload application form, project plan/DPR, land/lease details, investment and employment projections.
After verification by the nodal agency (UPELC/Department of IT & Electronics), you will receive the approval letter.
On commissioning and fulfilling obligations you claim subsidies/incentives as per policy.

Option 3: Offline/Hybrid Submission

Collect the application form from the nodal agency office of the state.
Submit documents physically - land proof, investment sanction, employment plan.
After field verification and approval, incentives are granted under route specified in policy.

Power Combos with The Scheme