Capital subsidy, power and tax support for MSMEs in Andhra Pradesh
Andhra Pradesh MSME and Entrepreneur Development Policy 4.0 (2024-29)
The policy was issued by G.O.Ms.No.69 of 26 October 2024. According to the policy, it is valid for five years from the date of notification or till a new policy is announced. G.O.Ms.No.22 of 17 February 2025 replaced the capital subsidy table (para 6.3), also changed the technology upgradation, power cost and net SGST paragraphs, and added a land cost rebate (para 6.11). The figures below are from that amendment, and the order says the incentives are given as per operational guidelines notified separately. The APIIC policies page lists only the policy and this one amendment, and we found no later order that replaces it.
New and expanding micro, small and medium units in Andhra Pradesh
- Capital subsidy for new enterprises, general category: 25% of fixed capital investment, capped at ₹25 lakh for micro, ₹1.5 crore for small and ₹7 crore for medium units, paid in 2, 3 and 4 yearly instalments
- Capital subsidy for new special category enterprises (wholly owned by women, BC, SC, ST, minority, specially abled or transgender entrepreneurs who live in the state): 45% up to ₹45 lakh for micro, 45% up to ₹4.5 crore for small and 35% up to ₹7 crore for medium units
- For SC/ST enterprises in transport services: 45% up to ₹45 lakh for micro, 45% up to ₹75 lakh for small and 35% up to ₹75 lakh for medium units
- Technology upgradation subsidy for expansion or diversification units: 20% of fixed capital investment, capped at ₹20 lakh, ₹2 crore and ₹5 crore, and for special category units 40% (up to ₹40 lakh and ₹4 crore) for micro and small and 30% (up to ₹5 crore) for medium
- Power cost reimbursement of ₹1 per unit for 5 years, capped at ₹1 lakh, ₹5 lakh and ₹15 lakh a year, and ₹1.5 per unit for special category micro and small units
- Net SGST reimbursement of 100% for 5 years, up to 5% of annual turnover each year, and not more than 100% of fixed capital investment in total
- A 75% rebate on land cost, up to ₹25 lakh, for SC/ST-led micro and small units in industrial estates or parks developed by APIIC (new units only, once on the land)
- A micro, small or medium enterprise in manufacturing or services
- Capital subsidy applies to new enterprises, technology upgradation to expansions or diversifications only
- The special category rates need an enterprise wholly owned by the listed groups, with the owners living in the state
- G.O.Ms.No.69 records the Finance Department's requirement that capital subsidy and technology upgradation are mutually exclusive and that total subsidy and incentives stay within 75% of fixed capital investment
Through the District Industries Centre and the state's Single Desk and incentive portals, managed by the Commissionerate of Industries. The AP MSME ONE portal (apmsmeone.ap.gov.in) is the place to start.