The State of Uttar Pradesh has introduced the Uttar Pradesh Pharmaceutical Industry Policy, 2018 (“Policy”) to attract investments considering the flourishing pharma market in India and also being the largest consumer market in India for pharma products.

The Policy aims to establish specialized pharmaceutical parks with best in class infrastructure and technology, encourage cutting edge research in pharma sector based on world class infrastructure, promote creation of Intellectual Property Rights and to elevate ayurvedic treatment. The Policy further promotes innovations and start-ups through Uttar Pradesh Information Technology and Start Up Policy, 2017. The Government of Uttar Pradesh will also facilitate setting up private pharma parks, it will provide plug and play infrastructure to such companies interested in setting up such pharma parks.

The Policy will be in force for 5 years from the date of commencement (i.e. 8^th June, 2018) subject to amendments from time to time.

To be able to appreciate the applicability of the Policy, it is important to consider a few definitions under the Policy:

• MSME Unit – Units having capital investment as approved by Government of India under MSMED Act, 2006.
• Large Unit – Units having capital investment more than MSME units but less than the value of Rs. 100 Crore.
• Mega Units – Units having capital investment more than Rs. 100 Crore.
• Horizontal Pharma Parks – Parks developed over minimum 10 Acres of land consisting at least 5 units and 60% of which is allotted to the entrepreneurs.
• Vertical Pharma Parks – Parks developed over minimum 3 Acres of land consisting at least 3 units like group of towers and 60% of which is allotted to the entrepreneurs.

Benefits / Incentives under the Policy: –

The Policy provides several incentives for Horizontal and Vertical Pharma Parks under the Uttar Pradesh Industrial Investment and Employment Promotion Policy, 2017, which are as follows;

1. Interest subsidy in form of re-imbursement of interest of 50% of annual interest on loan taken for buying lands for a period of 7 years to a maximum subsidy of INR 50 Lakhs per annum.
2. Interest subsidy in form of re-imbursement of interest of 60% of annual interest on loan taken for building infrastructure for a period of 7 years to a maximum subsidy of INR 10 Crore per annum subject to a maximum subsidy of INR 50 Crore for the total period.
3. Interest subsidy in form of re-imbursement of interest of 60% of annual interest on loan taken for building common facilities for a period of 7 years to a maximum subsidy of INR 5 Crore per annum subject to a maximum subsidy of INR 30 Crore for the total period.
4. 100% exemption on stamp duty for purchase of land by any developer and 50% exemption on stamp duty for individuals.

Further incentives prescribed under State’s Industrial Investment and Employment Promotion Policy, 2017 is also extended to pharmaceutical units under this Policy;

1. Capital Interest Subsidy to the extent of 5% per annum for a period of 5 years in form of re-imbursement on loan taken for procurement of plant and machinery subject to a maximum cap of INR 50 Lakhs per unit per annum.
2. Infrastructure Interest Subsidy to the extent of 5% per annum for a period of 5 years in form of re-imbursement on loan taken for developing infrastructure subject to a maximum cap of INR 1 Crore per annum.
3. Industrial Research Subsidy to the extent of 5% per annum for a period of 5 years in form of re-imbursement on loan taken for developing infrastructure subject to an overall cap of INR 1 Crore per annum.
4. Electricity Duty Exemption – 100% exemption for 10 years for all new units. 100% exemption in electricity duty for 10 years all new units producing electricity from captive power plants for self – use.
5. Stamp Duty Exemption – 100% exemption for all new units across the State.
6. SGST Re-imbursement – (a) 90% for MSME Units in Pharma Sector for 5 years, (b) 60% for Large Units in Pharma Sector for 5 years, (c) 70% for Mega Units in Pharma Sector for 5 years, this will be subject to annual ceiling of 20% of capital investment or actual tax deposited, whichever is lower, further subject to maximum ceiling of 100% of fixed capital investment made by Unit.
7. 100% Mandi fees exemption

Further to all the above subsidies, environmental subsidies are also prescribed for such units. The State Government shall be providing support in Research and Development sector, it has further simplified patent filling procedure with 100% waiver in filling fees. For expedient process of implementation, it will be having Single Window system, which will work under the supervision of the Chief Minister.

Please refer to the hyperlink below for further information.

Source: Government of Uttar Pradesh

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