Investment Promotion Scheme (IPS) — ₹4 Lakh Subsidy for Handicraft Artisans
A capital subsidy of up to ₹4 lakh for handloom and handicraft artisans of Dadra & Nagar Haveli and Daman & Diu, covering machinery investment and working capital needs.
- Funding amount
- ₹4L (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 Investment Promotion Scheme (IPS) for Handicraft Artisans runs a focused sub-scheme for handloom and handicraft artisans of the Union Territory of Dadra & Nagar Haveli and Daman & Diu. It is administered by the Department of Industries, U.T. Administration of Dadra & Nagar Haveli and Daman & Diu, and it stays open until 19 May 2027.
The sub-scheme, titled Assistance for Capital Investment for the Handloom and Handicrafts Artisans of the U.T. Requiring Financial Assistance for Purchase of Machinery or Raw Materials, was first launched on 3 July 2015 for a five-year term. It was extended from 20 May 2022 and now runs through to 19 May 2027.
It sits inside the wider Investment Promotion Scheme, whose larger purpose is to channel incentives and assistance to the MSME sector so small businesses can grow, absorb market fluctuations and remain viable. The parent scheme also aims to make the Union Territory a specialised MSME hub, draw more women into business, bring local unemployment down, and encourage industries to hire labourers who live in the U.T.
For an individual artisan, the value is direct: a capital subsidy towards machinery plus help with working capital such as raw material purchases. That allows traditional craftspeople to keep their craft alive while modernising equipment and expanding what they produce.
Highlights
- Capital subsidy of up to ₹4,00,000 for handloom and handicraft artisans
- 50% subsidy on machinery investment, capped at ₹2,00,000
- 50% subsidy on working capital loans, capped at ₹2,00,000
- Extra 10% subsidy for SC, ST, women and differently abled artisans
- Open only to residents of Dadra & Nagar Haveli and Daman & Diu
- Applications accepted until 19 May 2027
Who can apply
Who can apply
- You must be a handloom or handicraft artisan.
- You must be a resident of Dadra & Nagar Haveli and Daman & Diu.
- You must be above 18 years of age.
- You should intend to purchase machinery or raw materials for developing your business.
- You must genuinely possess handloom or handicraft art skills and be able to demonstrate the products you have made to an official committee.
The scheme is written for individual artisans, and the skill demonstration is a formal part of the process rather than a formality.
Investment Promotion Scheme (IPS) — ₹4 Lakh Subsidy for Handicraft Artisans 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 Investment Promotion Scheme (IPS) — ₹4 Lakh Subsidy for Handicraft Artisans 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
Two separate subsidies are on offer, and an artisan can claim both.
- Machinery investment subsidy: 50% of the amount invested in machinery, subject to a maximum of ₹2,00,000.
- Working capital loan subsidy: 50% of the loan taken for working capital — for instance, to buy raw materials — again capped at ₹2,00,000.
Taken together, the maximum support works out to ₹4,00,000 per artisan.
Artisans belonging to Scheduled Castes, Scheduled Tribes, Women and Differently Abled individuals (with 30% or more disability) receive an additional 10% subsidy, which lifts their overall financial support further.
Since each subsidy meets half the cost, the artisan is expected to arrange the remaining half, whether from own funds or through a loan. The scheme also eases access to government funding and gives small traditional businesses a financial lifeline to keep going and grow.
About the provider
Investment Promotion Scheme (IPS) — ₹4 Lakh Subsidy for Handicraft Artisans 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
Selection turns on a demonstration of the applicant's craft. Artisans must hold genuine handloom or handicraft skills and must be able to demonstrate the products they have made.
That demonstration is presented to a dedicated committee, typically comprising the General Manager (GM) of the District Industries Centre (DIC), the Director (Tourism) and the CEO (District Panchayat).
The committee assesses the artisan's craftsmanship together with the viability of the business development proposal, and on that basis determines whether the capital subsidy is granted.
Documents you’ll need
Before you apply to Investment Promotion Scheme (IPS) — ₹4 Lakh Subsidy for Handicraft Artisans, 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
Investment Promotion Scheme (IPS) — ₹4 Lakh Subsidy for Handicraft Artisans is best suited for startups in India seeking non-dilutive funding of ₹4L. If that describes your startup, review the eligibility criteria above before applying.
Frequently asked questions
How much funding does this IPS sub-scheme provide?
An artisan can receive a machinery investment subsidy of 50% of the amount invested in machinery, capped at ₹2,00,000, and a working capital loan subsidy of 50% of the loan taken, also capped at ₹2,00,000. Claimed together, that adds up to a maximum of ₹4,00,000. Artisans from Scheduled Castes, Scheduled Tribes, Women and Differently Abled categories (30% or more disability) get an additional 10% subsidy on top.
Who is eligible to apply?
You need to be a handloom or handicraft artisan, above 18 years of age, and a resident of Dadra & Nagar Haveli and Daman & Diu. You should be looking to buy machinery or raw materials to develop your business, and you must be able to demonstrate genuine handloom or handicraft skills by showing the products you have made to the official committee.
Do I have to live in Dadra & Nagar Haveli and Daman & Diu to apply?
Yes. Residency in the Union Territory of Dadra & Nagar Haveli and Daman & Diu is a stated condition of eligibility, since the scheme is run by the U.T.'s Department of Industries for artisans based in the U.T.
Is this a grant, a loan or equity funding?
It is a subsidy, which means the money does not have to be repaid and no equity or ownership stake is taken in the artisan's business. Because the scheme funds 50% of the machinery investment or working capital loan, the artisan is expected to arrange the remaining half through personal funds or a loan.
What can the subsidy money be used for?
The machinery investment subsidy applies to what you spend on machinery. The working capital loan subsidy applies to a working capital loan taken for running the business, such as purchasing raw materials. Both are aimed at developing and expanding your handloom or handicraft enterprise.
Is DPIIT recognition or MSME registration required to apply?
The eligibility conditions set out for this sub-scheme centre on being a handloom or handicraft artisan, being resident in the U.T., being above 18, and being able to demonstrate your craft. DPIIT recognition or MSME registration is not named among the stated requirements, so check the current notification and the Common Application Form before applying.
What is the deadline for applications?
The scheme remains operative until 19 May 2027, and applications are accepted during that window, which runs from 20 May 2022 to 19 May 2027. Applying well before the closing date is advisable.
How do I apply?
The process is entirely online. Register on the official portal at swp.dddgov.in/registration, verify your email through the link sent to you, and verify your mobile number. Your login credentials are then emailed to you. Log in at swp.dddgov.in/login with your registered mobile number and PIN, open the Departments & Services tab from the left menu, scroll to District Industries Centre DD & DNH and click through to Investment Promotion Scheme: 2022 to 2027. Fill in the Common Application Form, upload the mandatory documents specified there, re-check every detail and submit.
How is the application evaluated?
Your craftsmanship and your business development proposal are assessed through a demonstration of the products you have made. This demonstration goes before a dedicated committee that generally includes the General Manager (GM) of the District Industries Centre (DIC), the Director (Tourism) and the CEO (District Panchayat), who together decide whether the capital subsidy is granted.
Is there extra financial support for women, SC, ST or differently abled artisans?
Yes. Artisans from Scheduled Castes, Scheduled Tribes, Women, and Differently Abled individuals with 30% or more disability receive an additional 10% subsidy, which increases the total financial support they can receive under the scheme.
Who offers Investment Promotion Scheme (IPS) — ₹4 Lakh Subsidy for Handicraft Artisans?
Investment Promotion Scheme (IPS) — ₹4 Lakh Subsidy for Handicraft Artisans 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.
More funding from Department of Industries, UT Administration of Dadra and Nagar Haveli and Daman and Diu
Department of Industries, UT Administration of Dadra and Nagar Haveli and Daman and Diu runs 6 other programs listed on startupfunds — compare them before you decide where to apply.
Alternatives to Investment Promotion Scheme (IPS) — ₹4 Lakh Subsidy for Handicraft Artisans
Not sure Investment Promotion Scheme (IPS) — ₹4 Lakh Subsidy for Handicraft Artisans is the right fit, or already applied? These are other subsidies open to Indian startups that founders shortlist alongside it.
Questions from founders
Ask anything about eligibility, documents or the process — answered by the community.
No questions yet — be the first to ask.