Partner
From Viksit Bharat to Viksit Gujarat: Decoding Gujarat’s new industrial policy 2026
- Gujarat's Viksit Gujarat Industrial Policy 2026: 5-yr plan for $3.5T economy by 2047
- Covers strategic pillars, 11 thrust sectors, enterprise classification criteria
- Fiscal benefits are linked to investment levels, location, and enterprise category
- Extra benefits: EPF reimbursement, electricity duty exemption, ease-of-business measures
In June 2026, the Government of Gujarat unveiled the Viksit Gujarat Industrial Policy 2026, a comprehensive and forward-looking framework aimed at transforming Gujarat into a globally competitive industrial powerhouse while contributing to India's broader vision of becoming a developed nation by 2047 under the Viksit Bharat initiative.
At its core, the Viksit Gujarat Industrial Policy 2026 is built on four strategic pillars: Investment and Manufacturing, Innovation and Research, Skill Development and Employment, and Sustainability and Inclusive Development. The policy offers a wide range of fiscal incentives, with support levels ranging from 15% to 45% across identified sectors, thereby enhancing Gujarat’s attractiveness as an investment destination.
One of the policy’s most notable features is the introduction of the “Choose Your Incentive” mechanism, providing investors with greater flexibility to select benefits best aligned with their business models and investment objectives. This investor-centric approach reflects the Government’s commitment to ease of doing business and responsive governance.
As Gujarat embarks on this ambitious journey, the Industrial Policy 2026 is poised to play a pivotal role in shaping the State’s economic future and reinforcing its position as one of India’s leading engines of growth.
Policy overview
The policy succeeds Gujarat’s earlier industrial incentive framework and represents a significant evolution in the State’s approach to industrial development. The Viksit Gujarat Industrial Policy 2026 will remain in force for a period of five years, effective from 1 June 2026. At the heart of the policy lies the vision of “Viksit Gujarat se Viksit Bharat @ 2047”, reflecting Gujarat’s ambition to play a leading role in India’s journey towards becoming a developed nation by 2047.
The policy envisages transforming Gujarat into a USD 3.5 trillion economy by 2047, supported by an ambitious growth trajectory of 14–15% CAGR up to 2030. Beyond economic expansion, the policy emphasizes inclusive prosperity through the twin objectives of “Living Well” and “Earning Well”. It seeks to foster entrepreneurship, create high-quality employment opportunities, and improve the overall standard of living for the State’s growing workforce, particularly its youth.
To achieve these objectives, the Government has identified 11 Core Thrust Sectors that are expected to drive Gujarat’s next phase of industrial development. These sectors have been strategically selected to deepen manufacturing capabilities, strengthen domestic value chains, enhance technological self-reliance, and integrate Gujarat more effectively into global supply chains.
The identified thrust sectors include:
- Green Energy Ecosystem, covering green hydrogen & ammonia, electrolyzers, renewable energy equipment, battery storage, fuel cells
- Mobility, including auto and auto-components, aviation-related manufacturing, space-related manufacturing
- Capital Equipment, encompassing electrical, industrial and telecom machinery/equipment
- Textiles and Apparels, including textile, technical textile, apparel, garment
- Critical mineral processing/refining/extraction, metals and minerals, ceramics
- Sustainability, including municipal solid/liquid waste recycling equipment manufacturing
- Chemicals
- Agro and food processing
- Healthcare, including bulk drugs, APIs & KSMs, medical devices, pharmaceuticals
- Ancillary units of semiconductor industries (ultra-high-purity chemicals and gases, etc.)
- Nuclear Power Equipment, including Small Modular Reactors (SMRs)
In addition to the core sectors, the policy also recognizes several additional notified thrust sectors, including vehicle scrapping facilities, electronic waste recycling units, textile waste recycling units, manufacturing of shipping containers, and heavy earth-moving equipment such as cranes, excavators, and tunnel-boring machines.
Notably, the policy accords special importance to sectors with significant employment-generation potential and future economic relevance. Industries engaged in the manufacture of sports goods and equipment, toys, footwear, robots, and drones are eligible for the highest levels of incentives available under the policy, reflecting the Government’s intent to simultaneously promote labour-intensive manufacturing and emerging technology-driven industries.
Through this targeted sectoral approach, Gujarat seeks to reinforce its position as India’s manufacturing powerhouse while building capabilities in future-ready industries that will define the next era of industrial growth.
Classification
An enterprise is classified into categories based on the minimum investment in Plant and Machinery or Equipment and minimum employment generated. The categories prescribed under the policy are as follows:
Category |
Minimum Investment (Plant and Machinery or Equipment) |
Minimum Employment |
| Ultra-Mega Unit | Minimum INR 100 Bn | Minimum 3,000 employees (+500 per additional Investment of 50 Bn) |
| Mega Unit | Minimum INR 10 Bn | Minimum 250 employees (+50 per additional Investment of 2 Bn) |
| Large Unit | Minimum INR 1.25 Bn | NA |
| Medium | Above INR 250 Mn up to INR 1.25 Bn | NA |
| Small | Above INR 25 Mn up to INR 250 Mn | NA |
| Micro | Up to INR 25 Mn | NA |
It is pertinent to note that the Mega and Ultra-Mega classifications are available only to projects operating in notified thrust sectors.
Fiscal Incentives
Talukas across Gujarat are classified into Category-A and Category-B for incentive purposes, with Category-A Talukas (relatively less industrially developed) generally attracting a higher quantum of fiscal incentives than Category-B Talukas.
All incentives are computed as a percentage of the Eligible Fixed Capital Investment (“eFCI”), and eligible units may choose a suitable combination of Capital Subsidy, Interest Subsidy and Power Tariff Assistance. Units will have an option to choose a combination of capital subsidy, Interest subsidy and power tariff subject to a ceiling as summarised below:
Unit type |
Category |
Maximum/Ceiling |
Capital Subsidy |
Interest Subsidy |
Power Tariff |
| Selected Thrust Sector | A | 50% | 35% | 7% (up to 20% eFCI) | INR 2 per unit (up to 20% of eFCI) |
| B | 45% | 30% | 7% (up to 20% eFCI) | INR 1 per unit (up to 20% of eFCI) | |
| Ultra-Mega | A | 40% | 30% | 7% (up to 20% eFCI) | INR 2 per unit (up to 25% of eFCI) |
| B | 35% | 25% | 7% (up to 20% eFCI) | INR 1 per unit (up to 20% of eFCI) | |
| Mega | A | 35% | 25% | 7% (up to 25% eFCI) | INR 2 per unit (up to 25% of eFCI) |
| B | 30% | 20% | 7% (up to 20% eFCI) | INR 1 per unit (up to 20% of eFCI) | |
| Large(Thrust Sector) | A | 35% | 25% | 7% (up to 20% eFCI) | INR 2 per unit (up to 20% of eFCI) |
| B | 25% | 15% | 7% (up to 15% eFCI) | INR 1 per unit (up to 15% of eFCI) | |
| Large (Others) | A | 20% | 15% | 7% (up to 15% eFCI) | INR 2 per unit (up to 15% of eFCI) |
| B | 15% | 10% | 7% (up to 10% eFCI) | INR 1 per unit (up to 10% of eFCI) | |
| Small and Medium | A | 45% | 35% | 7% (up to 10% eFCI) | INR 2 per unit (up to 25% of eFCI) |
| B | 35% | 25% | 7% (up to 10% eFCI) | INR 1 per unit (up to 25% of eFCI) | |
| Micro | A | 45% | 35% | 7% (up to 10% eFCI) | INR 2 per unit (up to 25% of eFCI) |
| B | 35% | 25% | 7% (up to 10% eFCI) | INR 1 per unit (up to 25% of eFCI) |
Note: The policy provides for phased disbursement of incentives, with the duration varying based on the category of the enterprise. Benefits such as capital subsidy, interest subsidy, and power tariff support are available for periods ranging from 1 year to 12 years.
Additional incentives
In addition to the eFCI-linked incentives above, all eligible units may also avail the following additional benefits:
- EPF Reimbursement: The policy provides reimbursement of the employer’s statutory contributions for eligible employees for periods ranging from 5 to 10 years, subject to prescribed monthly caps, with enhanced benefits for female and specially abled employees.
- Electricity Duty Exemption: 100% exemption as per the Gujarat Electricity Duty Act, 1958.
- Stamp Duty & Registration Fee Reimbursement: 100% reimbursement, exclusively available to Ultra-Mega Units.
- Other Incentives: MSMEs may also avail incentives such as like quality certification, ZED certification, ERP assistance, assistance for technology acquisition, assistance for patent registration, assistance for energy and water consumption savings, etc.
Strategic fiscal and non-fiscal incentives
Beyond traditional investment incentives, the Viksit Gujarat Industrial Policy 2026 introduces a range of strategic measures to promote innovation, inclusive growth, and ease of doing business. Key fiscal initiatives include substantial support for R&D and innovation, startups, women-led enterprises, workforce housing, and sustainable manufacturing, with incentives covering capital investment, operational costs, skill development, and environmental infrastructure.
On the non-fiscal front, the policy strengthens Gujarat’s business ecosystem through a robust single-window clearance mechanism, simplified compliance framework for MSMEs, a digital Investor Facilitation Portal, dedicated industry support centres, Geographic Information System (GIS)-enabled land bank access, world-class industrial infrastructure, industry-focused skill development programs, and special provisions to facilitate industrial expansion and relocation. Together, these measures aim to enhance investor confidence, improve operational efficiency, and reinforce Gujarat’s position as a preferred investment destination.
Conclusion
The Viksit Gujarat Industrial Policy 2026 represents a significant evolution in Gujarat’s industrial development strategy, combining flexible investment-linked incentives with a strong focus on innovation, sustainability, and employment generation. By aligning industrial growth with the broader vision of Viksit Bharat 2047, the policy seeks to position Gujarat as a global hub for advanced manufacturing and future-ready industries.
While the policy offers substantial incentives and a robust ease-of-doing-business framework, the benefits available to an enterprise will depend on factors such as sector eligibility, project location, investment size, employment generation, and incentive selection. Accordingly, businesses should undertake a detailed project-level evaluation at the planning stage to optimize benefits and fully leverage the opportunities available under the policy.