IPS Textile Interest Subsidy — Up to ₹70L for DNH & Daman and Diu Units
A credit-linked subsidy from the DNH & DD Department of Industries that covers 60% of the bank interest a textile MSME pays, capped at ₹60 lakh a year and rising to ₹70 lakh for export-oriented carpet units.
- Funding amount
- ₹70L (subsidy)
- Funding type
- Subsidy
- Provider
- Department of Industries, UT Administration of Dadra and Nagar Haveli and Daman and Diu (Government)
- Application deadline
- 19 May 2027
- Eligible stage
- Any stage
- Location
- Open to startups registered in India
Overview
The Department of Industries of the U.T. Administration of Dadra & Nagar Haveli and Daman & Diu operates this programme as one sub-scheme within its larger Investment Promotion Scheme for MSMEs. Its scope is deliberately narrow: textile manufacturing. A unit that raises a bank loan for a fresh plant, for expansion or for diversification gets a share of the interest it pays back.
The sub-scheme was first introduced in 2015 and has been carried forward since, with the present window staying open until May 19, 2027. The administration's stated aim is to build the Union Territory into a specialised destination covering technical textiles, fabrics, carpets, garments, apparels, textile machinery and medical fabrics — a wide slice of the textile value chain rather than one product line.
Support of this kind is credit-linked, so it works directly on a unit's cost of borrowing instead of arriving as a flat handout. That is intended to make investment, capacity addition and technology adoption easier to justify, and in turn to drive industrial growth and a stronger local supply base. The scheme also carries social objectives: it seeks greater participation by women in business, and it encourages units to hire labour that lives in the Union Territory, opening up employment for local residents.
Highlights
- 60% interest subsidy on bank loans, capped at ₹60,00,000 per year
- Export-oriented carpet units get an extra 10%, taking the ceiling to ₹70,00,000 a year
- Support runs for 5 years or until the loan is repaid, whichever is earlier
- Open to MSME textile units in Dadra & Nagar Haveli and Daman and Diu
- Commercial production must begin between May 20, 2022 and May 19, 2027
- Apply online within one year of commencing commercial production
Who can apply
Eligibility rests on what the unit does, where it is situated and when it began production.
- Unit type: a new manufacturing or service unit in the MSME textile sector, or an existing unit going in for expansion or diversification.
- Location: the unit must be based in the U.T. of Dadra and Nagar Haveli and Daman and Diu.
- Production timeline: commercial production must have begun between May 20, 2022 and May 19, 2027.
- Filing window: the online application has to be submitted within one year of the date the unit becomes eligible, counted from the start of commercial production.
These conditions are meant to be read together — a unit has to satisfy the sector, the location and the production-timing tests to qualify.
IPS Textile Interest Subsidy — Up to ₹70L for DNH & Daman and Diu Units is open to startups at any stage. It is open to startups registered anywhere in India.
- Eligible stage
- Any stage
- Location
- Open to startups registered in India
Deadline & timing
Applications for IPS Textile Interest Subsidy — Up to ₹70L for DNH & Daman and Diu Units are open and the current deadline is 19 May 2027. Deadlines can change — always reconfirm on the official source before submitting.
What the funding covers
The subsidy is worked out on the interest your lender charges rather than on a fixed lump sum.
- 60% of the interest charged by the bank is covered.
- The payout is capped at ₹60,00,000 per annum.
- Support continues for 5 years, or until the loan is fully repaid — whichever happens first.
- Export-oriented carpet industries receive an extra 10%, which lifts their annual ceiling to ₹70,00,000.
Because the ceiling is stated annually, the total value a unit can draw depends on how much interest it actually pays and how long the loan runs inside that 5-year window. The higher ceiling for carpet exporters is designed to recognise units that bring in foreign exchange and compete in overseas markets.
About the provider
IPS Textile Interest Subsidy — Up to ₹70L for DNH & Daman and Diu Units is offered by Department of Industries, UT Administration of Dadra and Nagar Haveli and Daman and Diu, a government body. As a government-backed subsidy, it is publicly funded and open to eligible startups across India.
How to apply
Applications are submitted on the . Confirm the current deadline and document checklist there before you start.
Selection process
Applications are examined in two layers.
The District Industries Centre (DIC) screens every submission first, confirming that the eligibility conditions are satisfied and that all mandatory documents have been provided.
A committee made up of officials from the Department of Industries and other agencies of the U.T. Administration then evaluates the application. It weighs how well the proposal aligns with the scheme's objectives, whether the loan details are valid, and whether commercial production has in fact commenced. Approval turns on how complete and accurate the submission is and on conformity with the scheme guidelines.
Applicants who clear this stage are notified about the approval and the process by which the subsidy is disbursed.
Documents you’ll need
Before you apply to IPS Textile Interest Subsidy — Up to ₹70L for DNH & Daman and Diu Units, keep the following documents ready:
- A pitch deck or short business plan describing the problem, product and traction
- Company registration documents and PAN
- Founder identification (PAN / Aadhaar) and brief profiles
- Recent financial statements or projections
- Product details — a demo, prototype or working link if available
Exact requirements are confirmed on the official application portal — treat this as a preparation checklist.
Who this is best for
IPS Textile Interest Subsidy — Up to ₹70L for DNH & Daman and Diu Units is best suited for startups in India seeking non-dilutive funding of ₹70L. If that describes your startup, review the eligibility criteria above before applying.
Frequently asked questions
How much money does the interest subsidy actually pay out?
The Department covers 60% of the interest your bank charges on the loan, subject to a ceiling of ₹60,00,000 per year. If you are an export-oriented carpet industry, an additional 10% is added, which raises your annual limit to ₹70,00,000. The calculation always follows the interest you actually pay, so the final figure depends on your loan size and repayment period.
Who is eligible to apply for this textile subsidy?
You need to be a new manufacturing or service unit in the MSME textile sector, or an existing unit that is expanding or diversifying. The unit has to be located in the U.T. of Dadra and Nagar Haveli and Daman and Diu, and commercial production must have started between May 20, 2022 and May 19, 2027.
Does the scheme take equity in my company?
No. This is an interest subsidy, which means the Department reimburses a portion of the interest your bank charges on a loan you have raised yourself. It does not dilute your ownership or take a stake in the business.
Which textile segments fall under the scheme?
The scheme is aimed at specialised textile segments — technical textiles, fabrics, carpets, garments, apparels, and units manufacturing textile machinery and medical fabrics. It is intended to build the Union Territory into a hub across these segments rather than to support one narrow product category.
For how many years is the subsidy given?
Support is available for 5 years, or until the loan is fully repaid, whichever comes first. The clock runs from the point at which commercial production begins, so a unit that repays early receives the subsidy only up to the date of full repayment.
Do I need Udyam registration or DPIIT recognition?
An Udyam registration certificate is one of the documents you are required to upload with the application, so you should have it ready. DPIIT recognition does not feature among the scheme's stated requirements.
What documents are needed to apply?
The mandatory set generally includes your Udyam registration certificate, proof of the date on which commercial production commenced, the bank loan sanction letter, interest payment certificates issued by the bank, a project report, and other supporting business registration and financial documents.
What is the deadline for applying?
There are two dates to keep in mind. Your application must be filed online within one year from the date you become eligible, that is, from the commencement of commercial production. The overall scheme itself remains operative until May 19, 2027.
How do I submit the application?
Everything is handled online through the official Single Window Portal. You register an account, verify your email through the link sent to you, verify your mobile number with an OTP, and then log in with the credentials mailed to you. From the left menu, go to "Departments & Services", select "District Industries Centre DD & DNH" and open the "Investment Promotion Scheme : 2022 to 2027" application. Fill in the Common Application Form, upload the supporting documents, review everything and submit. The scheme notification is published at swp.dddgov.in.
Can a unit located outside Dadra & Nagar Haveli and Daman and Diu apply?
No. Being located within the U.T. of Dadra and Nagar Haveli and Daman and Diu is a core eligibility condition, alongside the requirement that the unit be a new manufacturing or service unit, or an existing one expanding or diversifying in the MSME textile sector.
Who offers IPS Textile Interest Subsidy — Up to ₹70L for DNH & Daman and Diu Units?
IPS Textile Interest Subsidy — Up to ₹70L for DNH & Daman and Diu Units is offered by Department of Industries, UT Administration of Dadra and Nagar Haveli and Daman and Diu, a government body. It is provided as non-dilutive funding.
How do I apply for IPS Textile Interest Subsidy — Up to ₹70L for DNH & Daman and Diu Units?
Apply directly through the official application link on this page. Review the eligibility criteria and prepare your startup documents before you begin.
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