Incentive Scheme for MSMEs in Powerloom Sector: Interest Subsidy on Term Loan (West Bengal)
Department of Micro, Small and Medium Enterprises and Textiles, Government of West Bengal · Central government
West Bengal’s scheme subsidises interest on term loans for eligible MSMEs installing shuttleless powerlooms to raise output.
Closed. Applications closed on 31 December 2024. The details below describe the most recent cycle.
Key facts
- Subsidy amount
- Up to ₹8,75,00,000
- Instrument
- Subsidy
- Deadline
- 31 December 2024
- Disbursement
- Paid in tranches
- Scheme duration
- 5 years
About this scheme
The 'Interest Subsidy on Term Loan' operates as a sub-scheme within the 'Incentive Scheme for MSMEs in Powerloom Sector', introduced on January 1, 2022, by the Department of Micro, Small & Medium Enterprises and Textiles, Government of West Bengal. Its validity extends until December 31, 2024. The parent scheme's purpose is to provide fiscal incentives to textile MSMEs for installing modern shuttleless powerlooms, with the goal of producing higher-quality fabrics, building a sustainable textile MSME ecosystem, optimising resource use, creating jobs, and broadening the state's operational footprint to position West Bengal as a national leader in the powerloom industry.
Under this sub-scheme, eligible micro, small, or medium enterprises in the powerloom sector can claim an interest subsidy on their annual interest payments. This benefit covers term loans obtained from commercial banks, cooperative banks, RBI-approved scheduled banks, Regional Rural Banks (RRBs), and central or state financial institutions. The funds are designated for approved projects that upgrade powerloom technology and infrastructure, thereby aiding the sector's modernisation and expansion.
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
- Required
- DPIIT startup recognition
- Not specified
- GST registration
- Not specified
- Where the business may be based
- West Bengal
- Applicable to all Micro, Small, and Medium Enterprises (MSMEs) in the powerloom sector of West Bengal. - Production must have commenced between January 1, 2022, and December 31, 2024. - A Four-party agreement is required with the Directorate of Textiles, the financial institution, and Tantuja. - The project must be supported by a detailed feasibility report and approved by a Central Financial Institution, Commercial Bank, or State Financial Institution.
How to apply
The application process is outlined below:
- Submission must be made offline using the prescribed Form-A2, accompanied by all necessary supporting documentation. - The completed application should be directed to the Directorate of Textiles. - The initial application must be filed within 12 months of the date commercial production begins. - The start of commercial production is required to occur during the scheme's validity period, which runs from January 1, 2022, to December 31, 2024. - Applications are to be sent to the following address: Directorate of Textiles, Handlooms, Spinning Mills, Silk Weaving & Handloom Based Handicrafts Division, New Secretariat Buildings, 1, K. S. Roy Road, 5th Floor, 'B' Block, Kolkata 700001.
How applications are assessed
The Directorate of Textiles assesses each application against the eligibility criteria, which includes examining the project's feasibility report and confirming approval from the financial institution. Following this review, the interest subsidy is granted, subject to the aforementioned approvals and an annual check that interest payments have been made.
Frequently asked questions
What is the main objective of the Interest Subsidy on Term Loan scheme?
The scheme offers fiscal incentives to MSMEs in West Bengal’s powerloom sector for installing new-age shuttleless powerlooms, aiming to boost quality fabric production, generate employment, and position the state as a leader in the industry.
Which enterprises are eligible to apply for this subsidy?
The scheme is available to MSMEs in the powerloom sector that began production between January 1, 2022, and December 31, 2024, and satisfy additional conditions. These enterprises must also possess a detailed feasibility report for their project, approved by a recognised financial institution.
What are the specific benefits for Micro & Small Enterprises?
Micro and Small Enterprises in Zones A and B receive an interest subsidy of 55% of their annual interest liability for 5 years; those in Zones C, D, and E receive 70%.
What are the specific benefits for Medium Enterprises?
Medium Enterprises can claim an interest subsidy equal to 25% of the total term loan interest paid over five years, capped at ₹1,75,00,000 per year.
How is the interest subsidy disbursed?
The interest subsidy is disbursed once a year, provided the enterprise submits a statement or certificate from its lending bank or financial institution confirming that all interest payments were made on time and without default during that period.
What is the application deadline for this scheme?
The scheme remains in force until December 31, 2024. Eligible enterprises must file their initial application within 12 months of starting commercial production, provided that production began during the scheme's validity period.
Sectors
- Manufacturing Industrial
- Msme
- Powerloom Sector
- Textile Industry
- West Bengal
- Interest Subsidy
Details last verified on 7 September 2026. Source: the issuer's published information.