Industry Facilitation

Steps to be followed by an entrepreneur

  • Collect maximum information about the project or products proposed to be manufactured
  • For the purpose, collect/prepare a project profile which would outline brief information on the project or products to be manufactured
  • Decide location where the project is likely to set up
  • Learn about the procedures and formalities required to be completed before taking up physical implementation of the project

Get a detailed project report prepared which interalia should include following components

  • Market potential of the products to be manufactured
  • Characteristics of the Location
  • Land and building requirements
  • Requirements and availability of Plant and Machinery
  • Requirement of other utilities namely power, water, steam etc.
  • Assessment of Working Capital requirements
  • Technology tie-up
  • Raw materials with specifications
  • Manpower requirements
  • Schedule of Implementation
  • Estimates of Project Cost
  • Tie up of means of finance
  • Cost of Production and profitability
  • Break even Point
  • Internal Rate of Return
  • Cash flow
  • Debt service Coverage Ratio to establish financial viability
  • Economic Benefits
  1. Industries licensing policy are regulated under the Industries Development Regulation Act 1951
  2. At present Industrial Licensing for manufacturing is required in case of :-
    • Industries under compulsory licensing
    • Manufacture of item reserved for SSI sector by non SSI units
    • Project location attracts locational restrictions

Compulsory Licensing

Following industries require compulsory industrial licence under the provisions of IDR Act, 1951.

  1. Distillation and brewing of alcoholic drinks.
  2. Cigars and cigarettes of tobacco and manufactured tobacco substitutes
  3. Electronic Aerospace and defence equipment: all types;
  4. Industrial explosives, including detonating fuses, safety fuses, gun powder, nitrocellulose and matches;
  5. Hazardous chemicals;
    • Hydrocyanic acid and its derivatives
    • Phosgene and its derivatives
    • Isocyanates and di-isocyanates of hydrocarbon, not elsewhere specified (example: Methyl Isocyanate).

Large industries undertaking manufacture of items reserved for SSI units

The Government has reserved certain items for exclusive manufacture in the small scale sector. Non-small scale units can undertake the manufacture of items reserved for small scale sector, only after obtaining an industrial licence. In such cases, the non-small scale unit is required to undertake an obligation to export 50% of the production of SSI reserved items

Locational Restrictions

Industrial undertakings are free to select the location of their projects. Industrial licence is however required if the proposed location is within 25 km of standard urban area limits of 23 cities having a population of one million as per 1991 Census. In Gujarat, this provision is applicable in the case of 3 cities namely Ahmedabad, Vadodara and Surat.


The Locational restriction however does not apply:

  1. If the unit were to be located in an area designated as an “industrial area” before the 25th July, 1991.
  2. In the case of Electronics, Computer software and Printing and any other industry, which may be notified in future as “non polluting industry”.

The location of industrial units is subject to applicable local zoning and land use regulations and environmental regulations

Procedure for obtaining Industrial Licence

Industrial licence is granted by the Secretarial of Industrial Assistance (SIA) on the recommendation of the Licensing Committee. For this purpose, Online application in the prescribed form (Form FC-IL) (with Applicable fees) may be submitted to SIA at ebiz portal (www.ebiz.gov.in) specially developed by GOI and also available on www.dipp.gov.in

Procedure for filing IEM

  • Industrial undertakings exempt from industrial license are only required to file an online Industrial Entrepreneur’s Memorandum (IEM) in Part ‘A’, in the prescribed format (Form IEM) with Secretariat for Industrial Assistance (SIA), Department of Industrial Policy & Promotion (DIPP), Ministry of Commerce & Industry, Government of India, New Delhi at ebiz portal (www.ebiz.gov.in) and also available on www.dipp.gov.in
  • Submission of IEM form requires a fee of Rs.1000/- for up to 10 items proposed to be manufactured. For more than 10 items an additional fee of Rs.250/- for up to 10 additional items needs to be paid.
    • On filing the IEM, an acknowledgement containing the SIA registration No. for future reference is issued. This acknowledgement is sent by post and no further approval is required.

Upon commencement of commercial production, industrial undertakings need to file online information in Part-B of the IEM to SIA. No fee is to be paid for filing Part-B.

All the fees payment mode is online or offline.

Government of India under the Ministry of Micro, Small and Medium Enterprises have in October 2006 enacted Micro, Small and Medium Enterprises Development Act 2006. Under the Act, Micro, Small and Medium Enterprises are classified as under:

Sr No.EnterprisesInvestment in Plant & Machinery (Manufacturing)Investment in Equipment (service)

1.

Micro

Up to Rs. 25 lakhs

Up to Rs. 10 lakhs

2.

Small

Above Rs. 25 lakhs up to Rs. 5 crore

Above Rs. 10 lakhs up to Rs. 2 crore

3.

Medium

Above Rs. 5 crore up to Rs. 10 crore

Above Rs. 2 crore up to Rs. 5 crore

The small and medium enterprises as classified above, are required to file Entrepreneurs Memorandum (EM) Part-I to District Industries Centre for starting an industrial project. On completion of the project, the entrepreneur concerned is required to file Entrepreneurs Memorandum (EM) Part-II.

District Industries Centers in all the districts of the state and the institutions such as Gujarat Industrial Development Corporation (GIDC) and Gujarat State Financial Corporation (GSFC) have been instrumental in accelerating the pace of development of SSIs. On the other hand, Small scale industries have also played an important role in dispersal of industries.

Earlier there was a system of granting registration to small scale industrial units by the District Industries Centre. These units are now required to file EM Part-II as Micro, Small or Medium Enterprises as classified above. On line submission & Processing of EM-I & EM-II has been made available in website w.e.f. 01/07/2013.

Following the enactment of the MSME Development Act from 2nd October, 2006, registrations of all the MSMEs came within the purview of the Industries Commissionerate. Surat district leads the state with the highest number of SSI units followed by Ahmedabad, Rajkot and other districts. Over a period of time, Gujarat has registered a sizeable growth of SME sector.

There are 261760 MSMEs Registered in Gujarat till March 2014. Following tables presents the details of the year wise, district wise and group-wise registrations of MSMEs in Gujarat from 2-10-2006 to 31-3-2014, respectively.

Year wise Registered MSME in Gujarat
YearUnit

2006-2007

4131

2007-2008

13186

2008-2009

17867

2009-2010

19993

2010-2011

27940

2011-2012

51781

2012-2013

68235

2013-2014

58627

Total 261760

District wise Registered MSME in Gujarat
Sr No.District NameUnitNo. of SSI Units(% Share)
1 Ahmedabad 69014 26.36
2 Amreli 943 0.36
3 Anand 2511 0.95
4 Banaskantha 1370 0.52
5 Bharuch 5431 2.07
6 Bhavnagar 4389 1.67
7 Dahod 456 0.17
8 Dang 5 0.00
9 Gandhinagar 2862 1.09
10 Jamnagar 4966 1.89
11 Junagadh 1352 0.51
12 Kachchh 1636 0.62
13 Kheda 1053 0.40
14 Mehsana 2049 0.78
15 Narmada 754 0.28
16 Navsari 2475 0.94
17 Panchmahal 1207 0.46
18 Patan 611 0.23
19 Porbandar 628 0.23
20 Rajkot 20431 7.80
21 Sabarkantha 1987 0.75
22 Surat 116183 44.38
23 Surendranagar 2116 0.80
24 Tapi 430 0.16
25 Vadodara 12312 4.70
26 valsad 4589 1.75
  Total 261760 100
Group wise Registered MSME in Gujarat
Sr No.GroupRegistrations from 2-10-2006 to 31-3-2014
  MicroSmallMediumTotal
1 Textiles 68171 8206 351 76728
2 Machinery and parts except electrical 20668 2478 81 23227
3 Mining and Quarrying 2778 685 18 3481
4 Food Products 4853 1498 60 6411
5 Chemical & chemical Products 7078 2311 133 9522
6 Wood Products 3043 318 15 3376
7 Rubber & Plastic Products 5414 1518 79 7011
8 Non-metallic mineral Products 3927 1251 174 5352
9 Basic Metal Industries 16908 2615 121 19644
10 Paper Product & Printing 4269 926 67 5262
11 Electrical Machinery and Apparatus 68171 726 25 5907
12 Transport equipment and parts 1906 461 10 2377
13 Leather Products 3641 821 27 4489
14 Beverages, Tobacco & Tobacco Products 1052 166 2 1220
15 Service Activities 25606 1288 79 26973
16 Trading Activities 48200 358 9 48567
17 Other 10597 1503 113 12213
  Total 233267 27129 1364 261760

There were only 2169 small industries in 1961 at the time formation of the state. The number of SSIs increased continuously and has reached to over to 3,12,000 by September 2006. This may be observed from the following table:

Group wise Registered MSME in Gujarat
YearNo. of SSI Units
1960 2,169
1970 15,849
1980 43,742
1990 1,15,384
2000 2,51,088
2005 3,06,646
2006(up to September) 3,12,782
District & Year wise Registration of SSI Units
Sr No.District NameUpto 31st September-2006(P)No. of SSI Units(% Share)
1 Ahmedabad 65763 21.02
2 Amreli 4890 1.56
3 Banaskantha 6819 2.18
4 Bharuch 14328 4.58
5 Bhavnagar 11821 3.77
6 Gandhinagar 4808 1.53
7 Jamnagar 13236 4.23
8 Junagadh 7986 2.55
9 Kheda 13521 4.32
10 Kutch 6109 1.95
11 Mehsana 14602 4.66
12 Panchmahals 6704 2.14
13 Rajkot 32461 10.37
14 Sabarkantha 8601 2.74
15 Surat 47404 15.15
16 Surendranagar 8609 2.75
17 Vadodara 18498 5.91
18 Valsad 611 0.23
19 Porbandar 15966 5.10
20 Dang 53 0.016
21 Anand 2298 0.73
22 Dahod 1092 0.34
23 Navsari 3357 1.07
24 Patan 2274 0.72
25 Porbandar 766 0.24
Total 312782 100
Groupwise Registrered of SSI Units (As on 2nd oct. 2006)
Sr No.Industry Group SSI Units regd
1 Food Products 16467
2 Beverages, Tobacco & Tobacco Products 1455
3 Textiles 66914
4 Wood Products 13498
5 Paper Products & Printing 8244
6 Leather Products 2476
7 Rubber & Plastic Products 11780
8 Chemical & Chemical Product 15553
9 Non- Metallic Mineral Products 11345
10 Basic Metal Industries 8795
11 Metal Products 23421
12 Machinery & Parts except Electronics 23792
13 Electrical Machinery & Apparatus 6451
14 Transport Equipments & Parts 2944
15 Others 99647
Total 312782
 Approval TypeAuthorityRemarks
1.0Industrial Approval

1.1

Entrepreneurship Memorandum (EM)

District Industries Centre

For setting up SME

1.2

Industrial Entrepreneurship Memorandum(IEM)

Secretariat For Industrial Approval(SIA), New Delhi

For setting up projects other than SME, and not included in the list of compulsory licensing provision

1.3

Letter of Intent(LOI)

Do

  • Projects requiring compulsory licensing

1.4

100% Export Oriented Units(EOU) & SEZ units

Development Commissioner, KASEZ

Application in prescribed form

2.0

Business Constitution

2.1

Registration as Firm Registrar of Firms Proprietary concerns or Partnership Firm

2.2

For approval of Name of Private/Public Limited Company and incorporation thereof Registrar of Companies Private Ltd. or Public Ltd. Company

2.3

Cooperative Society Registrar of Cooperatives For forming Cooperative Society

3.0

Land for project

3.1

Allotment of plot/shed in Industrial Estate GIDC Application in prescribed form

3.2

Allotment of Government land District Collector No prescribed application

3.3

Agricultural Land Purchase through negotiation No prior permission required

4.0

NA Permission

Collector/DDO

Prescribed application form for deemed NA

5.0

Environment Clearance

5.1

No Objection Certificate Gujarat Pollution Board Application in the prescribed form by polluting industries like chemicals, pharmaceuticals, etc. (other than 99 industries listed by GPCB)

5.2

Environmental Clearance (EC) Ministry of Environment and Forest (MOEF) Specific projects need prior environmental clearance from MOEF/State level Environment Impact Assessment Authority (SEIAA)

5.3

Consent and Authorization G.P.C.B. On completion of the project and meeting the norms for disposal of effluents, G.P.C.B. will issue consent letter Construction of Building

6.0

Construction of Building

6.1

Plan Approval in Industrial Estate GIDC Application to Regional Manager, GIDC

6.2

Plan Approval in other area Local Authority, Application to concerned local authority, where site is selected

7.0

Water Requirement

7.1

In Industrial Estate GIDC Application to Regional Manager/ Executive Engineer of GIDC

7.2

River/Public Service Department of Narmada & Water Resources, GoG Application to Executive Engineer in-charge of concerned Irrigation scheme

8.0

Power Requirement

8.1

Power requirement Gujarat Urja Vikas Nigam Ltd.-Distribution Company or respective agencies Application in prescribed form

9.0

Financial Requirement

9.1

Capital Issue SEBI Application in prescribed form to Security Exchange Board of India

9.2

Term Loan Financial Institutions or Bank Application in prescribed form along with detailed Project Report

9.3

Working Capital Banks
  • Application to Branch Manager of a Commercial Bank
  • Under the ‘Single Window Scheme’, both term loan & working capital upto Rs 25 lakhs is considered

10.0

Final Approval

10.1

SME DIC EM Part II

10.2

Large Units SIA
  • LOI is to be converted into IL
  • IEM Part B in case of delicensed units

11.0

Registration of Establishment

11.1

Registration under Shops & Establishment Act Local Authority/Municipal Corporation Registration of an industrial unit not covered under Factories Act

11.2

Registration as Factory Chief Inspector of Factories Application in prescribed form under the Factories Act

12.0

Value Added Tax

12.1

VAT Registration Commercial Tax Officer Application for certificate of registration under GVAT Act 2003. (In case of turnover exceeding Rs. 5 lakhs having sales of above Rs. 10,000 VAT applicable items)

Office of The Industries Commissionerate Block No. 1, 2nd Floor, Udyog Bhavan, Gandhinagar 382 010. Gujarat. INDIA
Ph. : 23252683/23252617 • Email ID : iccord@gujarat.gov.in

Copyright@2016, The Industries Commissionerate. All Rights Reserved.
Go back to top