Employment Incentive under Motivation of Entrepreneurs to Start Industries and Fiscal Assistance to Industries - Various Incentives
Industries and Commerce Department, Government of Puducherry · Central government
The Puducherry Industries and Commerce Department scheme funds eligible industrial units with a 20% wage subsidy up to ₹5 lakh annually for 5-7 years.
Open, rolling. Applications are accepted continuously — there is no deadline.
Key facts
- Subsidy amount
- Up to ₹35,00,000
- Instrument
- Subsidy
- Deadline
- Rolling
- Disbursement
- Paid in tranches
- Scheme duration
- 85 months
About this scheme
The Industries and Commerce Department of the Union Territory of Puducherry introduced the Employment Incentive scheme on April 1, 2017. It is designed to encourage entrepreneurs to set up industries and offers fiscal support across the entire UT. Eligible industrial units receive a wage subsidy equal to 20% of the salary, subject to a ceiling of ₹5,00,000 per year, for employees enrolled under the Provident Fund (PF).
The subsidy is available for 5 years in Puducherry and Karaikal, and for 7 years in Mahe and Yanam. Disbursement may occur in one or several instalments, depending on fund availability. For bank-financed units, the amount is channelled through the lending institution to offset loans or to fund additional fixed assets or working capital. Self-financed units receive the payment directly from the department. The scheme seeks to lower employment costs for eligible enterprises, thereby promoting industrial growth and job creation in the region.
Who can apply
- Eligible business forms
- Private limited company, Limited liability partnership, One person company, Partnership firm, Sole proprietorship
- Udyam registration
- Not specified
- MSME registration
- Not specified
- DPIIT startup recognition
- Not specified
- GST registration
- Not specified
- Where the business may be based
- Puducherry
- All Micro, Small, Medium, and Large Industries are eligible. - Investment must have been made on or after 1st April 2017. - At least 60% of employment must be provided to residents of the Union Territory of Puducherry. - Direct employment must be given to at least 10 persons. - Workers must be covered under Provident Fund (PF). - Fixed assets, including plant and machinery, must not be transferred or disposed of for 5 years from the date of application or disbursement of subsidy, whichever is later.
How to apply
- The industrial unit must submit its claim for incentive or subsidy using the prescribed form, which is accessible on the official website of the Directorate of Industries and Commerce, Puducherry. - Complete every mandatory field in the application form and enclose copies of all required documents, self-attesting them where necessary. - Hand over the completed and signed application form, along with the supporting documents, to the designated authority. - Obtain a receipt or acknowledgement from that authority upon submission. Verify that the receipt records the date and time of submission and, where applicable, a unique identification number.
How applications are assessed
The Directorate of Industries scrutinises applications on merit to determine the admissible quantum of incentives, subsidies, or assistance. Evaluated applications are then referred to the State Level Committee, which reviews each case to decide on eligibility and recommends the amount payable, in line with scheme guidelines.
Frequently asked questions
Who is eligible to apply for this employment incentive scheme?
The scheme is open to all Micro, Small, Medium, and Large Industries that have invested on or after April 1, 2017. Units must employ at least 10 persons directly, with 60% of total employment from Puducherry UT residents, and workers must be covered under Provident Fund (PF).
What is the maximum subsidy amount I can receive?
Eligible units may claim a wage/employment subsidy covering 20% of the wage or salary, capped at ₹5,00,000 per year, for a duration of 5 to 7 years depending on the location within Puducherry UT.
How is the subsidy disbursed?
The subsidy is released either in one lump sum or in instalments. For bank-financed units, it is credited through the financial institution to offset loans, fund fixed assets, or support working capital, while self-financed units receive it directly from the department.
Are there any restrictions on the unit after availing the subsidy?
The industrial unit must not transfer or dispose of fixed assets, including plant and machinery, for 5 years from the later of the application date or subsidy disbursement, to ensure continued operation and stability.
How do I apply for the Employment Incentive scheme?
Submit the prescribed form, available on the Directorate of Industries and Commerce, Puducherry website, with all mandatory fields and self-attested documents to the concerned authority. Obtain a receipt or acknowledgement for your submission.
Sectors
- Puducherry
- Wage Subsidy
- Employment Incentive
- Msme
- Manufacturing
Details last verified on 3 August 2026. Source: the issuer's published information.