Disclaimer

"The government orders have been translated from Original purely to facilitate non-Hindi users and for wider reach. Although utmost care has been taken to ensure the accuracy of translation, yet in case of any differences in interpretation of provisions provided herein, the 'Original' Hindi version will prevail." No.-402/77-6-14-5 (M)/13 From: Jawed Usmani Chief Secretary, Government of . To, All Principal Secretaries/Secretaries, Government of Uttar Pradesh. All Divisional Commissioners / District Magistrates, Uttar Pradesh. Commissioner and Director, Industries, Uttar Pradesh, Kanpur. Executive Director, Udyog Bandhu, Lucknow.

Industrial Development Section-6 Lucknow: 3rd March, 2014

Subject: Encouragement to establishment of Mega Projects in the State.

Sir/Madam, In the context of the subject mentioned above, kindly refer to the Infrastructure & Industrial Investment Policy 2012 issued by the State Government, under its Para 5.7, titled ‘Mega Projects’, it has been provisioned to make permissible special facilities and incentives on case-to-case basis to encourage establishment of Mega Projects. 2. In view of the hurdles in establishment of mega projects in the state, after partial amendment in Para 5.7 of the policy and superseding previously issued Government Order No. 1457/77-6-12-08-(M)/12-T.C.-VII, dated 23.01.13 as well as 'U.P. Mega Projects Encouragement Regulations 2012', notified vide Office Order No. 138/77-6-12-T.C.-VII, dated 23.01.13, a comprehensive Government Order is hereby issued as under: 3. This scheme shall be applicable in whole of Uttar Pradesh (U.P.). 4. After partial amendment in Para 5.7 of Infrastructure & Industrial Investment Policy 2012, it has been provisioned that 'Mega Projects' mean all private or joint sector (in which the equity of government or any public sector enterprise is less than or equal to 49%) industrial units with proposed investment of INR 200 Crore or more, including such units also, which are undertaking expansion / diversification. Often urgent state government help is required for setting up of such units, so that time could be saved in their establishment and production could be commenced from them as soon as possible. In order to attract large scale capital investment to the State and to transform Uttar Pradesh into the most competitive investment destination across the globe, it is imperative that more and more mega projects are established in the state. To achieve this objective, the state government shall encourage mega projects in the following manner: (a) Subject to appropriate conditions, all fiscal incentives specified in Infrastructure & Industrial Investment Policy 2012 shall be made permissible to mega projects with capital investment of more than INR 200 Crores but less than INR 500

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Crores. The maximum financial limit of such incentives could be relaxed on case-to-case basis after due approval by Hon’ble Cabinet of Ministers on the recommendation of Empowered Committee, but with the condition that incentives, which are not covered in the Infrastructure & Industrial Investment Policy 2012, shall not be permissible to this category of Mega Projects. Allotment of land, water, power connection, etc. will be made available to these projects on priority through Fast Track Mode. In case, infrastructure facilities like- roads, power line, sewer line, drainage are required for setting up of such projects, the same shall be considered to be provided at partial or whole government expenditure. (b) Mega Projects with capital investment of INR 500 Crores or more, in addition to abovementioned incentives, might be provided even those facilities, which are not covered under Infrastructure & Industrial Investment Policy-2012. These facilities shall be provided on case-to-case basis after due approval by Hon’ble Cabinet of Ministers on the recommendation of Empowered Committee.

(c) All such facilities that are permissible to Industrial Mega Projects with an investment of INR 500 Crore or more, shall also be available to the projects with capital investment of INR 500 Crore or more towards enabling skill development and proficiency enhancement in the State on case-to-case basis after due approval of Hon’ble State Cabinet of Ministers on the recommendation of Empowered Committee.

5. All benefits available to Mega projects could also be provided to brown-field and units undertaking expansion/diversification along with green-field units. 6. Calculation of fixed capital investment shall include investment made in land, building, plant and machinery and other capital assets. ‘Plant & Machinery’ refers to new plant and machinery, which includes instruments, humidifier, generating sets, boilers, captive power plant, apparatus, components, jigs, fixtures, dyes and moulds; and other such new plant-machinery which may be used for production according to the nature of unit. 7. The fiscal benefits provided under the permissible special facilities to mega projects shall be made admissible on the capital investment made after the cut-off date. ‘Cut-off Date’ means date of issue of original Government Order for encouragement to mega projects, i.e. 23.01.2013. 8. His Excellency Governor of Uttar Pradesh has the pleasure to allow constitution of following Empowered Committee for promotion of Mega projects and projects towards skill development and proficiency enhancement under the Infrastructure & Industrial Investment Policy 2012, as defined in the Para 4(c) above. 8.1 Empowered Committee: 1. Chief Secretary, Government of Uttar Pradesh CHAIRMAN 2. Infrastructure & Industrial Development Commissioner, Government of U.P. MEMBER 3. Principal Secretary, Infrastructure & Industrial Development

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Department, Government of U.P. MEMBER 4. Principal Secretary, Finance Department, Government of U.P.MEMBER 5. Principal Secretary, Planning Department, Government of U.P.MEMBER 6. Principal Secretary, Law Department, Government of U.P. MEMBER 7. Principal Secretary, Micro, Small & Medium Enterprises Department, Government of U.P. MEMBER 8. Executive Director, Udyog Bandhu MEMBER SECRETARY 8.2 As and when required, Divisional Commissioners/ Principal Secretaries /Secretaries of the concerned departments will be invited to meetings of the Empowered Committee. 8.3 Udyog Bandhu will function as the Secretariat of the Empowered Committee. Representations/ applications received from industrial units will be forwarded to departments concerned for their report within three working days as much as possible. The departments concerned will compulsorily submit the report to Udyog Bandhu within one week. Udyog Bandhu shall place the related case for consideration of the Empowered Committee in its forthcoming meeting. Entrepreneur as well as department concerned will also be invited to attend this meeting. 9. Scope of the Empowered Committee: 9.1 To consider on case-to-case basis the merits and demerits of special concessions/incentives sought by Mega projects with capital investment of more than INR 200 Crore in Uttar Pradesh. 9.2 To consider the merits and demerits of special incentives sought by all Mega projects from the State government, including also those units undertaking expansion/diversification, on case-to-case basis according to the government orders and, if there is consensus, to present the case through Industrial Development Department to Hon’ble Cabinet of Ministers for decision. 9.3 To consider on case-to-case basis the merits and demerits of special incentives sought by all Mega projects with capital investment of INR 500 Crore or more towards enabling skill development, proficiency enhancement or capacity building in the State and, if there is consensus, to present the case through Industrial Development Department to Hon’ble Cabinet of Ministers for decision. 9.4 To take a final view on providing infrastructure facilities to Mega Projects by establishing inter-departmental coordination. In case, infrastructure facilities like- roads, power line, sewer line, drainage are sought for setting up of such projects, the same to be considered for providing at partial or whole government expenditure. 9.5 To resolve issues of entrepreneurs relating to setting up of Mega Projects and to facilitate issuance of approvals/clearances by departments concerned on fast track mode.

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9.6 To consider allotment of land, allocation of water from rivers and canals, power connection on fast track mode. 9.7 To review Policies, Rules and Acts related to setting up of Mega Projects and to recommend for their simplification and improvement. 9.8 To review the progress of providing special incentives by different departments/ Authorities/ Corporations, etc. to Mega Projects after approval by Hon’ble Cabinet of Ministers. 9.9 To address the problems being faced by Nodal Officer, nominated for inter- departmental coordination for setting up of Mega Projects. 10. The meeting of the Committee could be convened once in every two months and even earlier if required. 11. Udyog Bandhu is being nominated as Authorized Agency for implementation of this scheme. Udyog Bandhu means State level Udyog Bandhu, which has been registered under Firm & Societies Act, 1860 and an agency under the control of Government of U.P. 12. Mega project shall have to fulfill following conditions to get the incentives under the policy: 12.1 Industrial Entrepreneur Memorandum/ Letter of Intent (IEM/LoI) should have been filed in the Department of Industrial Policy and Promotion of Government of . 12.2 Maximum 15 per cent of the estimated project cost or less could have been invested before the ‘Cut-off Date’, even if it is made in the form of advance capital investment. If the company has purchased land before the Cut-off Date or has purchased building along with land from any government body/financial institution/scheduled bank before the Cut-off Date, then such industrial unit shall not be ineligible under this scheme, however, investment made in land and building shall not be included in the calculation of fixed capital investment of INR 200 Crore/INR 500 Crore. 12.3 Assessment of 'Fixed Capital Investment' of INR 200 Crore/INR 500 Crore shall be made on the basis of fixed capital investment made till the start of commercial production from the Cut-off Date. 12.4 For accurate calculation of fixed capital investment amount, it should be certified by the authorised Director and Statutory Auditor of the company. To confirm the authenticity of the capital investment shown through certificates provided, the Industrial Development Department, if required, shall get it verified by an appropriate agency. 12.5 A ‘Letter of Comfort’ shall be issued for special facilities to be made permissible regarding mega project and it will be mandatory to commence commercial production within 5 years from the date of issue of the Letter of Comfort. 12.6 After getting the ‘Letter of Comfort’, the promoter company shall submit a copy of the appraisal report to the ‘Authorised Agency’ after getting the project appraisal done by a Scheduled Commercial Bank (excluding regional rural banks) or Financial Institutions under the control of these

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banks or for approval of loan for setting up of project. Even if the unit is not taking loan from any financial institution or bank, it shall be mandatory that the unit gets the appraisal done by an agency from aforementioned institutions. The 'Authorised Agency' has to provide fiscal incentives under the scheme, therefore the Authorised Agency shall not do the appraisal of the project. 12.7 If the project is being set up in phased manner and accordingly the commercial production is commenced in phases at different points in time, then the special facilities, permissible under mega projects, should be permitted only when the unit is being established at one place and it is clearly mentioned in the DPR that the project will be established in phased manner and the project appraisal is based on this DPR, provided that the nature of the product to be produced by the unit in all phases should be same. However, such facilities shall be available, subject to the condition that the unit commences commercial production of the last phase within 5 years from the date of issuance of Letter of Comfort; and for the unit to be eligible as Mega Project, the mandatory capital investment has been made after the Cut-off Date but before the commencement of commercial production of last phase. In such condition, special facilities, permissible to Mega Projects, shall be provided from the date of mandatory capital investment made by the unit to qualify as mega project. 13. Procedure for approval of permissible incentives under the scheme: 13.1 The Promoter Company of the proposed project shall send the proposal to Udyog Bandhu. 13.2 The Authorised Agency shall forward the representations/ applications received from industrial units to concerned departments within three working days as much as possible. The departments concerned shall compulsorily submit the report along with relevant conditions, if any, on these representations/ applications to the Authorised Agency within one week. 13.3 As defined in above paragraph 13.2, after receipt of report along with assessment from departments concerned, the Authorised Agency shall compile these reports and present the proposal along with permissible incentives in the prescribed format before the Empowered Committee for consideration through Industrial Development Department. 13.4 After the recommendation of the Empowered Committee, the Authorised Agency shall forward the proposal as well as recommendation of the Empowered Committee to Industrial Development Department. 13.5 Industrial Development Department shall present the project proposal received from Authorised Agency for the approval of Hon'ble Cabinet of Ministers. In case the proposal is accorded approval by Hon'ble Cabinet of Ministers, Industrial Development Department shall ask the Departments/ Authorities/ Corporations concerned to issue necessary Government Orders

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or to initiate any other action required to make available the incentives/ concessions to Mega Project as approved by Hon'ble Cabinet of Ministers. 13.6 The Empowered Committee shall monitor the issuance of all aforementioned Government Orders and completion of other actions taken. 13.7 Udyog Bandhu shall get the Nodal Officers nominated for the implementation of different projects; these officers shall ensure time-bound action to address problems in implementation of the projects by establishing inter-departmental coordination. 14. Procedure for providing the incentives under the scheme: 14.1 To avail the benefits under the scheme, the unit shall present the application before the Authorised Agency after fulfilling all conditions described in the Letter of Comfort issued for setting up of Mega project. The Authorised Agency, then, will compile the application and present it before the Empowered Committee. When the unit fulfills the conditions of Letter of Comfort, the Empowered Committee, firming up its view, shall seek the orders of Hon’ble Cabinet of Ministers through Industrial Development Department. 14.2 Authorised Agency shall present the proposal for the recommendation of Empowered Committee through Industrial Development Department. In case the Empowered Committee recommends for providing incentives, the Industrial Development Department shall place it before the Hon'ble Cabinet of Ministers for approval. If the Hon'ble Cabinet of Ministers accords its approval, the Authorised Agency shall initiate action exclusively according to the approval and orders of Hon'ble Cabinet of Ministers. 14.3 Permissible facilities shall be provided according to the procedure specified in the corresponding government order. If any such facility is to be provided for which procedural government order has not been issued, then the department concerned will issue the government order as per the rules. 15. Units shall have to furnish all information demanded by the Authorised Agency during the scheme time period. 16. Miscellaneous: 16.1 In case of any dispute or requirement of clarifications associated with the implementation of this scheme, such cases shall be referred to the Authorised Agency. 16.2 If the case is not resolved, it shall be referred to the Empowered Committee, whose decision shall be final. 16.3 The Empowered Committee shall have the powers to clarify any subject matter under the scheme and to modify the scheme. 17. Government Orders were issued earlier regarding special facilities available to Mega projects under the Infrastructure & Industrial Investment Policy 2012. In case there is incongruence on the subject of permissible facilities provided in the earlier issued government orders, then this Government Order shall be applicable. Kindly ensure necessary action according to the above.

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Sd/- (Jawed Usmani) Chief Secretary

G.O. No.-402(1)/77-6-14-5 (M)/13, Dated as above Copy forwarded to the following for information and necessary action: (1) Accountant General, Audit (I & II) U. P., . (2) Infrastructure & Industrial Development Commissioner, Government of U.P. (3) Principal Secretary, Hon’ble Chief Minister, Government of U.P. (4) All Joint Secretaries, Deputy Secretaries, Under Secretaries and all Sections of Industrial Development Department. (5) All Heads of Departments/ Managing Directors of Corporations and Chief Executive Officers of Industrial Development Authorities under the control of Industrial Development Department. (6) Staff Officer, Chief Secretary, Government of U.P. (7) Forwarded to Director, Printing & Stationery with the request to get 1500 copies of the G.O. printed and make available to Industrial Development Section-6 and to send copies to all District Magistrates and Divisional Commissioners of U.P. (8) Finance (Income-Expenditure) Section-1 / Finance (Expenditure-control) Section-6, Government of U.P. (9) Planning Section-1, Government of U.P. (10) Guard File

By order Sd/- (Devi Prasad) Joint Secretary G.O. No.-402(2)/77-6-14-5 (M)/13, Dated as above Copy to: Director, Department of Information & Public Relation, U.P. – Lucknow with the order to kindly ensure wide publicity and extension of the scheme through all newspapers and other publicity media. By order Sd/- (Devi Prasad) Joint Secretary

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