UNNATI 2024 explained: central incentives for new and expanding units in the Northeast
UNNATI 2024 offers capital investment incentives, interest subvention and GST-linked incentives to units in the eight Northeast states. What it offers and its timelines.
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UNNATI 2024 (Uttar Poorva Transformative Industrialization Scheme) is the Government of India's main industrial incentive scheme for the eight Northeast states. It is a central sector scheme run by DPIIT (Department for Promotion of Industry and Internal Trade) together with the states.
Check the registration window first
Registration was originally open until 31 March 2026. In May 2026, DPIIT officials said at an official event in Sikkim that the registration window had been extended to 30 September 2026. Unless it has been extended again, new registrations may now be closed. Check the official UNNATI portal or your state industries department before planning around it.
The numbers
The Union Cabinet approved UNNATI 2024 on 7 March 2024, for 10 years from notification, plus 8 years for committed liabilities, at a total cost of ₹10,037 crore. Of the incentive budget (Part A, ₹9,737 crore), 60% is earmarked for the eight Northeast states and 40% is allotted on a first-in-first-out basis.
Districts are classed as Zone A (industrially advanced) or Zone B (industrially backward). Backward districts get more.
The incentives
| Incentive | Zone A | Zone B |
|---|---|---|
| Capital investment incentive (new and expanding units), where GST applies | 30% of eligible investment, cap ₹5 crore | 50%, cap ₹7.5 crore |
| Capital investment incentive, where GST does not apply | 30%, cap ₹10 crore | 50%, cap ₹10 crore |
| Central capital interest subvention (new and expanding units) | 3% a year for 7 years | 5% a year for 7 years |
| Manufacturing & services linked incentive (new units only, linked to net GST paid) | Up to 75% of eligible plant & machinery investment | Up to 100% |
The maximum benefit to one unit from all components is ₹250 crore. "Eligible investment" means plant and machinery (manufacturing) or building and durable physical assets (services).
For micro industries, the plant and machinery calculation for the capital investment incentive includes the cost of building construction, which helps small units where the shed is a large part of the cost.
Timelines
- Units must start production or operation within 4 years of registration.
- All registration applications were to be disposed of by 31 March 2027.
- The scheme runs up to 31 March 2034.
How it combines with state policy
UNNATI sits alongside state policies. For example, Meghalaya's 2024 industrial policy says that where a unit gets a capital investment incentive or interest subvention under UNNATI, the state incentive covers only the difference between the state rate and the central benefit. See Meghalaya's 2024 industrial policy explained.
What this means for a business plan
Worked example (illustrative numbers)
A new micro manufacturing unit in a Zone B district invests ₹60 lakh in machinery and its shed, where GST applies. At 50%, the capital investment incentive works out to ₹30 lakh, well within the ₹7.5 crore cap. If it borrows ₹45 lakh as a term loan, a 5% interest subvention for 7 years reduces its interest cost substantially. (Illustrative only: eligibility, zone and amounts are decided by the scheme committees.)
- Incentives are usually paid after the unit invests and starts production, so the unit still needs the full funding at the start: promoter contribution plus a term loan.
- Lenders typically appraise the project on its own cash flows; expected incentives may help, but do not rely on them to make a weak project work.
References
- Cabinet approves Uttar Poorva Transformative Industrialization Scheme, 2024 (7 March 2024), Press Information Bureau, Government of India (accessed 4 November 2026)
- Samvad under UNNATI 2024 highlights investment opportunities in Sikkim (14 May 2026), Government of Sikkim (accessed 4 November 2026)
- Meghalaya Industrial and Investment Promotion Policy, 2024 (notification of 14 March 2024), Commerce & Industries Department, Government of Meghalaya (accessed 4 November 2026)
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