Know about the Subsidy Benefits in Odisha State

Hello Businessman

Today, we’re going to share valuable information about the MSME-specific subsidy benefits available in the state of Odisha.

If you are planning to set up a new business or expand your existing MSME unit in Odisha — or even if you’re from outside the state but looking to invest in Odisha — this blog will help you understand the key subsidy advantages offered under the Odisha MSME Development Policy 2022.

Whether you’re working in the biomass, manufacturing, or any other MSME sector, these incentives can significantly reduce your investment cost and improve project viability.

1. Capital Investment Subsidy

The Odisha Government provides a Capital Investment Subsidy of 25% on machinery investment to all eligible MSME units.

The maximum limit is ₹2 crore.
For special categories such as SC/ST entrepreneurs, women entrepreneurs, or technically qualified promoters, the subsidy increases to 30%, up to ₹2.50 crore.

This is one of the biggest financial benefits under the policy, as it directly reduces your machinery cost.

2. 100% Stamp Duty Exemption

If you purchase land for business purposes, 100% stamp duty exemption is available for MSME units in Odisha.
This means you do not need to pay any stamp duty while registering the land for your enterprise — resulting in huge savings during the setup stage.

3. SGST Reimbursement

Odisha offers a State GST (SGST) Reimbursement to promote manufacturing within the state.
MSMEs can claim 75% reimbursement of the SGST paid to the state government for the first 3 years after commercial production.
This refund reduces your effective tax burden and enhances business cash flow.

4. Land Conversion Charge Exemption

If you are converting agricultural land for industrial use, the state government provides 100% exemption from land conversion charges for up to 5 acres of land.

5. Interest Subsidy on Term Loans

MSME units that avail a bank term loan are eligible for an Interest Subsidy of 50% of the interest paid.
This means if you have taken a loan at an interest rate of 10%, you effectively pay only 5% after subsidy — making finance cheaper and business expansion more feasible.

6. Power and Electricity Duty Exemption

New MSME units with a connected load up to 750 KVA are exempted from paying electricity duty for the first 5 years.
This significantly reduces operational expenses during the early growth stage.

7. EPF and Employment-Linked Benefits

Entrepreneurs who create new jobs and register employees under EPF (Employees Provident Fund) or ESI (Employees State Insurance) are also eligible for additional employment generation incentives under the policy.

8. Conditions for Availing Benefits

It’s important to note:

You cannot claim double benefits under two different schemes for the same project.
However, if you have availed a lesser subsidy under a central government scheme, you can claim the differential amount under the Odisha MSME Development Policy.
Example: If you received 20% capital subsidy under a central scheme, you can claim the remaining 5% under the Odisha MSME policy (to make it 25%).

Conclusion

Odisha offers one of the most progressive and business-friendly MSME subsidy frameworks in India.
If you are planning to start a business — especially in biomass, agri-infrastructure, or manufacturing sectors — these benefits can make your project far more profitable and financially sustainable.

At KIP Financial Consultancy Pvt. Ltd., we have been providing Subsidy Planning and Project Viability Consultancy since 2008.
We help MSMEs and investors identify, apply for, and claim all eligible state and central government incentives.

If you are planning a new business project in Odisha, get in touch with us to make your “Subsidy Planning” a part of your overall business strategy.

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