Focus to build Maharashtra as a “Magnetic Maharashtra” for IT and ITeS sectors…
The State cabinet of Maharashtra has approved a new IT and ITeS Policy for a period of 5 years. The current policy issued in the year 2015 was lapsed in 2020. It took almost 3 years to formulate a new IT policy. The reasons for the delay are well known to everyone like COVID-19, change of Government during this period. Incidentally, Maharashtra was first state in India to have its own IT policy which was released in the year 1998.
The new IT policy-2023 is formulated by keeping in mind below targets,
- Attract new investment of INR 95,000 Crore towards IT &ITES sector in the State.
- Create new 3.5 million jobs opportunities through IT &ITES sector in the State.
- Increase the skill development by 15% per annum for developing highly employable, talented and quality manpower.
- Achieve export of INR Crore through IT &ITES sector in the State
The above targets will be achieved with blow mentioned pillars,
With the above help of above pillars and action planned, the Government of Maharashtra is hoping to achieve its target set out in the policy.
The IT and ITeS policy 2023 will has below incentives for the units,
- IT as an Essential Service: The IT / ITeS Industry services clients across the globe and in different time zones. This requires the Industry to work on 24x7x365 mode. The IT / I TES Industry will be permitted to work 24x7x365 days without any close down. lT &ITES units are granted essential services status. The Data Centre will be covered under Essential Services and Maintenance Act (ESMA) as an essential service considering the nature and importance of operations involved which cannot be interrupted.
- IT Infrastructure creation: Integrated IT Township, Private IT Parks and IT &ITES units are allowed to set up across all zones including residential zones, no development zones and green zones as declared by the State.
- MAHITI Portal: An integrated single window platform will be developed to enhance the experience of conducting IT&ITES business in Maharashtra.
- Floor Space Index for IT Parks: To provide built up space at affordable rates to the entrepreneurs more additional FSI over the base FSI is made admissible.
- Integrated IT Townships (IITTs): Special townships envisioned to be developed as integrated technology cities with minimal restrictions on support services to accommodate the needs of the future workforce and reinforce state’s social infrastructure. The minimum land requirement for developing IITTs is redefined.
- Focus on Data Centers: The government will earmark land parcels especially in MIDC industrial areas to be developed as dedicated Data Center Parks. The policy now exempts the sector from standard parking norms, grants industry &infrastructure status, allows the eligible units to avail renewable energy under open access and to develop captive power plants for Data Center Parks.
- Maharashtra Hub (M-Hub): An integrated Center of Excellence housing specialized task forces for leading state initiatives on AVGC, Emerging Technologies, and startup & entrepreneurship in Information Technologies. It will play a critical role in holistic development and growth of IT industry in Maharashtra. A key feature of M-Hub is the Public-Private Partnership Model that will ensure active participation of private players towards thought leadership and capacity building.
- Stamp Duty exemptions: IT & ITeS units will be eligible to get Stamp Duty exemption only for premises which has O.C./ B.C.C. for the area to be occupied by the unit from the concerned planning Authority. If existing unit makes minimum 25% additional fixed capital investment, on or after commencement of this policy, in IT &ITES /AVGC activity then such project will be considered as expansion / diversification project and it will be eligible for stamp duty exemption. Stamp duty will be exempted for below transactions,
- Electricity Duty benefits.
The IT units will be eligible for exemption for payment of electricity duty which gets levied on electricity consumed by the unit. The details of the same is tabulated below,
However, it is important to note that in earlier policy provisions, there was a possibility of getting a refund of electricity duty in case the unit applies late for some reasons. However, under the recent policy, the unit will be entitled to exemption only from the date of approval for exemption. In other words, in case someone delays in making application, the unit will lose out the benefit to that extent.
- Power TariffIT &ITES units will be supplied power at industrial rates applicable under Maharashtra Electricity Regulatory Commission’s (MERC) tariff orders. The difference in per unit is rate between commercial and industrial rate is close to Rs 5 per unit.
- Property Tax
Property tax will be levied at par with residential rates as applicable in the relevant jurisdictions.
- Setting-up IT &ITES units in any zone
IT/ ITeS units will be allowed to be set up in any zone (including residential, no-development zones and green zone etc.).
In addition to the above, there are more benefits like more FSI allowed for IT parks than permitted FSI in the area, flexibility in land usage in IT parks for office, residential and commercial use etc.
The vision and mission outlined in the policy is commendable. It will be great for State of Maharashtra in case the Government of Maharashtra is able to achieve the targets with these measures. It is now up to the industry to take benefit of this policy and make Maharashtra a magnetic Maharashtra for IT and ITeS sectors. It is also important to note that other state Governments also provides similar benefits to IT unit. Hence not just fiscal benefits, the ease of setting up needs to be focused so that the investors feel welcomed in Maharashtra. We at Bizsolindia have a specialized team to assist IT and ITeS units and the IT park developers for getting all the benefits envisaged in the IT policy 2023. You can reach out to us for any assistance.