Capital Subsidies & Status

Capital Subsidy (Invest In Madhya Pradesh)

 

 
 

 

Tourism Projects Entitled for Capital Subsidy

Tourism Projects established and operationalised during the operative tenure of this policy shall be entitled to capital investment subsidy. Considering to the type of activity and the capital investment, capital subsidy shall be granted as mentioned below:

Sl. No.

Subsidy Scheme

Minimum Project Expenditure (Rs. in lakh)

Percentage of Subsidy against Fixed Capital Investment

Maximum ceiling of Subsidy (Rs. in lakh)

1

Capital subsidy for Heritage Hotel under Proprietorship

300

15%

200

2

Capital Investment subsidy for establishment of Heritage Hotel where the Heritage Assets are obtained from Tourism Department on Lease

1000

 

15%

 

500

 

3

Capital Investment subsidy to establish a new Deluxe/Three Star or Higher category new Hotel and Resort

1000

 

15%

 

500

 

4

Capital Investment subsidy for establishment of new Hotel/Mini Resort of Standard category

200

15%

50

5

Capital Investment subsidy for establishment of new Resort and Wellness Centre (Including Resort equipped with Ayurvedic, Yoga and Naturopathic treatment)

500

15%

200

6

Capital Investment Subsidy  for expansion of established Star/Deluxe/Standard Hotel/ Resort/Heritage Hotel

100

15%

500

7

Capital Investment Subsidy for establishment of 500 or more seater convention centre as above cum Hotel under MICE (Meetings, Incentives, Conferences, Exhibitions)

2000

15%

1000

8

Capital Investment Subsidy  for creation of  infrastructure along with installation of equipment to establish Film Studio, Film making, Museum, Aquarium, Theme Park

100

15%

500

9

Capital Investment subsidy for creation of infrastructure and installation of permanent facility/ acquisition of equipment/Tents and facilities to establish Adventure Tourism, Water Tourism, Water Sports, Cruise/House boat, Navigation infrastructure, Amusement Park, Sound and Light show, Laser show, Camping (including tents)

05 

15%

300

10

Capital Investment subsidy for establishment of way side Amenities under Green Field/ Franchise Model with minimum investment of Rs. 25.00 lakh

25

15%

50

11

Capital Investment subsidy for creation of infrastructure such as power supply, water supply, approach road, sewage and drainage system on land and heritage assets obtained from Tourism Department on lease basis.

50

25%

300

12

Installation of Ropeway infrastructure for transport in inaccessible tourist places/ forest areas.

100

40%

500

13

Capital subsidy for establishment of Sea Plane, Amphibian Tourist Vehicle and Aero Sports and Aero Sports Training Centre/Academy

100

25%

1000

To be eligible for capital subsidy for new Deluxe and Standard hotels being established shall have to give 70% jobs mandatorily to the residents of Madhya Pradesh.

 

Special incentives for Wildlife Resorts

Resorts being established within 20 kilometers radius of the notified National Parks/Tiger Reserves and Sanctuaries shall be eligible for capital subsidy as under according to the category of the forest area:  

Category of Forest area

Name of forest area

 

Minimum investment

(Rs in crore)

Minimum number of rooms

Capital subsidy

Maximum ceiling of capital subsidy

(Rs in crore)

A

Kanha, Bandhavgarh, Pench Tiger Reserve & adjacent National Parks & Sanctuaries.

5.00

 

10

20%

1.00

B

Panna & Satpuda Tiger Reserve and adjacent National Parks & Sanctuaries.

3.00

07

20%

2.00

C

Sanjay Dubri Tiger Reserve and National Parks and adjacent National Parks & Sanctuaries and all other national parks/sanctuaries except as mentioned in A & B above.

1.00

05

20%

3.00

 

 

Additional subsidy to establish Tourism Projects in distant & new ulterior areas -

Additional 5% Capital Investment Subsidy shall be given to the tourism projects established in distant and ulterior areas. In such areas the minimum investment limit shall be 50% of the prescribed limit as mentioned in the Tourism Policy.  Similarly, number of rooms ceiling shall be reduced to 50%. There shall be no upper limit on maximum amount of capital subsidy.

1.    To be eligible for capital investment subsidy, the projects shall have to be established outside the Nagar Nigam, planning area boundaries of Indore, Bhopal, Ujjain, Dewas, Sagar, Gwalior, Jabalpur, Katni, Rewa & Satna cities.  

2.    There should not be any similar unit within the 10 Kms. radius of proposed unit.

3.    If any such unit established by M.P. Government or its undertaking in the area of the proposed project shall not be taken in to account, for the purpose of point 2 above.

4.    If a wildlife resorts is eligible to get benefits under this category may have an option to choose any one category under the tourism policy.

Capital subsidy to existing hotels for renovation/modernization & upgradation - 

  1. On upgradation/renovation/modernization of existing standard hotels and mini resorts in to Deluxe Hotels (minimum 50 rooms) resorts (minimum 20 rooms), capital subsidy will be provided as per the tourism policy under such category.  To be eligible for subsidy minimum 10.00 crore investment shall be required.
  2. On upgradation/renovation/modernization of existing deluxe hotels and resorts in to 4 star or higher category Hotels (minimum 75 rooms) resorts (minimum 25 rooms), capital subsidy will be provided as per the tourism policy under such category. To be eligible for subsidy minimum 25.00 crore investment shall be required.
  3. All such units shall be entitled for subsidy on capital investment made after the enforcement of this Policy.

 

5. Investment Promotion assistance to setup Large/Mega/Ultra-mega tourism projects -

Large/Mega/Ultra-mega tourism projects shall be entitled for Investment promotion assistance according to their category as follows :-

Category of the project

Minimum investment in the project

Minimum number of employment (for residents of M.P.) 

Percentage of Investment Promotion Assistance on capital investment made by the unit

Maximum ceiling of Investment Promotion Assistance 

(Rs in crore)

Year wise Percentage of Disbursement of Investment Promotion Assistance Amount

First year  

Second year  

Third year

Fourth year  

Large

Rs. 10.00 crore or more

50

30%

15

10%

10%

5%

5%

Mega

Rs.50.00 crore or more  

100

30%

30

10%

10%

5%

5%

Ultra-mega

Rs.100 crore or more  

200

30%

90

10%

10%

5%

5%

For setting up Heritage Hotels the requirement of minimum investment and employment condition shall be 50% of the above-mentioned categories.

Any unit claiming Investment Promotion Assistance shall not be entitled for capital subsidy in any other category under the policy.

 

Subsidy for Responsible tourism - 

(i) Any unit certified by Eco Tourism Society of India shall be entitled for reimbursement of 100% investment made to obtain such certificate subject to a maximum ceiling of Rs. 1.00 lakh.

(ii) Any new or existing tourism unit which setup Pollution Control mechanism according to the guidelines of Pollution Control Board, shall be entitled for 25% subsidy on such investment subject to maximum Rs. 50.00 lakh provided, the minimum investment is made more than 10.00 lakh to setup such mechanism.

 

Special incentives to SC/ST entrepreneurs -

SC, ST category entrepreneurs who establishes tourism project under 100% ownership, shall be entitled for an additional 5% capital investment subsidy.

 

Phase wise incentives and subsidy to Heritage/Large/Mega & Ultra-Mega projects-

  1. Heritage/Large/Mega/Ultra-mega projects shall be entitled to get phase wise incentives/grant during the implementation of project as per approved implementation timeline. To get phase wise incentives/grant it is mandatory to complete the first phase of the project in 2 years, 2nd phase in 3 years and last phase in 5 years. The unit will get benefits only up to the eligibility limits as per policy.   
  2. For any of the grant/subsidy the capital investment shall be considered which is acceptable for capital subsidy.
  3. If any unit is entitled for grant/subsidy in more than one category, shall have an option to choose the category in which they are willing to get the benefit. Out of two similar facility only one category could be chosen. For example, if a unit has the entitlement for both general category of incentive and specific unit category shall be entitled for only one category.    

 

SPECIAL INCENTIVE SCHEME FOR BRANDED HOTELS, RESORTS & HERITAGE HOTELS

1. The Policy will be called “Promotion of Branded Hotel Policy 2019”. Under this policy any brand hotel established and commenced commercial operation with in five years and in case of Heritage Hotels 7 years from the date of enforcement of this policy shall be eligible for getting benefit of this policy.

2.   Keeping in view the possibilities of establishment of projects in the State, the Brands have been classified in following 3 categories :-

a. Brand Hotels

b. Brand Resorts

c. Brand Heritage Hotels 

 

ELIGIBILITY CRITERIA

Criteria

Branded Hotel

Resort

Branded Heritage Hotel

Net-worth of group

INR 1 billion

INR 500 million

INR 500 million

Turnover (Last Financial  Year)

INR 1.5 billion

INR 1 billion

INR 1 billion

Number of minimum  operational rooms

750

70

100

Number of minimum  operational units

10

5

5

Minimum proposed  investment by brand/investor

INR 1 billion

INR 300 million

INR 300 million

 

Above eligibility criteria shall be considered on producing the balance sheet and a certificate from chartered accountant. 

 

3.   Brands working on the following model shall be eligible for perpetual assistance -

Module

 Specialties

1. Operation on contract

  The Brand has taken the property for minimum 10 years for operation on Business agreement. Commercial operation and marketing is being performed by the Brand as per his expertise. All commercial expenses are being born by the owner/investor of the property.

2. Operation on Lease/  License

  The Brand has taken the property from investor on Lease/License for a period of not less than 10 years or more and operation is being done by the Brand. All operational expenses are being born by the Brand.

3. Operation on franchise

   The Brand has given franchise to the investor for operation on certain terms & condition and operation manual for operation. All required technical assistance and marketing support in being given by the Brand. All operational expenses are being born by the franchise

4.   Eligibility of the unit, desirous to avail benefits/incentives under the policy, shall be determine on the basis of the provisions of the agreement made between the Brand and the other party.

5. Any hotel who does not possess Brand hotel status prior to enforcement of this policy and have upgraded the hotel as branded hotel according to the prescribed norms of Brand Hotel, after enforcement of the policy shall also be eligible for all benefits under the policy. 

6. The hotels / resort / heritage hotels established / operated by the brands will be eligible for continuous operating grant as below per year for 03 years from the date of their commercial start. 

 

INCENTIVE SCHEME

Property Type

No of constructed rooms available on rent

Continuous  operational incentive  as % of Per  year  room rental  income (excl. tax)

Limit of Annual Incentives for NEW property (INR)

Limit of Annual Incentives for EXISTING property being converted to Branded property

Branded Hotels

50

20 %

10 million

5 million

51-100

25 %

20 million

10 million

101 and more

30 %

  30 million

15 million

Branded Resorts

10

20 %

5 million

2.5 million

11-20

25 %

10 million

5 million

21 and more

30 %

 20 million

10 million

Branded Heritage Hotels

10

20 %

7.5 million

4 million

11-30

25 %

15 million

8 million

31 and more

30 %

20 million

12 million

 

Rules & Procedure for claiming Capital Subsidy

Definitions of Tourism Projects

Amendment and clarification on Tourism Projects

 

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