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MP Offers Lucrative Incentives in its Information Technology Policy

With an aim to develop the Information technology sector of the state along with IT Enabled Services (ITES) and Electronic Hardware Manufacturing (EHM) to make the state an investor friendly industrial state, Madhya Pradesh launched its Information Technology Investment Policy in the year 2014.


  • To generate direct and indirect employment opportunities in the IT sector
  • To increase the flow of investments for the said industry
  • To extend the development and infrastructure opportunity in smaller cities
  • To promote establishment of IT units in IT Parks/IT Investment Areas

Main Highlights:

Single Window Clearance System- The state department of Science and Technology would work for attracting IT Industries for Investment in the State. Also, MP Trade & Investment Facilitation Corporation (MP-TRIFAC) would act as a Single Window for undertaking the formalities related to clearing projects and facilitating mechanism.


Incentives on quality certifications-

  • 75% reimbursement of the cost that an IT unit has obtained on certification of Capability Maturity Model (CMM/CMMi) Peoples Capability Maturity Model (PCMM) amounting to a maximum of Rs. 6 lacs.
  • 50% reimbursement of the cost that an IT unit has obtained on certification of ISO 9001 or an equivalent certification amounting to a maximum of Rs. 1 lac. Both the incentives would be available for once.

Land concessions- A minimum of 60% of the total IT investment area would be used for IT operations and the rest 40% could be used for secondary usages and support services.

Rebate in the cost of land- Land would be made available at a rate of 25% depending upon the availability of land provided that the investment in fixed capital would have to be made within three years. However, rebate would be given only to government lands.

Project Cost (In Rs Crores) Land available at concessional rate
Up to Rs 100 Crores 25 Acres as per requirement subject to a limit of 1 Acre for every Rs. 4 Crore of Investment
More than Rs 100 Crores Case to case basis

 Interest subsidy- All new IT units having a capital investment up to Rs. 10 crores would be entitled for an One Time Capital Subsidy of 25% subject to a maximum of Rs. 25 lacs.

IT Investment promotion assistance-All new IT Units would be entitled for Investment Promotion Assistance after adjusting the rebate on the amount of Value Added Tax (VAT) and Central Sales Tax (CST) on the purchase of raw materials. The assistance is hereunder-

Eligible Capital Investment (In Crores) Percentage of Tax Paid as Investment Promotion Assistance Period of Assistance (No. of Years)
Up to Rs. 10 Crores 50 5
Above Rs. 10 Crores 75 10

 Reimbursement on skill gap training- To provide skill gap trainings to the resident Engineers/ IT/ITES Professionals of the state, one time reimbursement up to 50% of the cost incurred by the unit subject to maximum amount of Rs. 10,000/- per employee, who are trained by the Unit within first Two years of the starting of commercial operations.

Entry tax- EHM units would be exempted from entry tax for a period of 5 years.

Marketing assistance- All IT Units would be entitled for a subsidy at the rate of 50% on Stall Rentals for participating in designated National and International Exhibitions/Events subject to a maximum amount of Rs. 2 Lacs for International and 1 Lac for National Events. However, this incentive would be available for once in a financial year.

Facilities on expansion/modernization- All existing IT units undergoing expansion/modernization would be entitled for facilities to help them out with such issues.  In order to qualify for this incentive the additional Capital investment in expansion should be a minimum of 50% of the existing capital investment subject to a minimum of Rs. 25 Lakh.

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