Subsidies

questions posed by the United States regarding
the new and full notification of India[1]

The following communication, dated 28 April 2025, is being circulated at the request of the delegation of the United States.

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The United States appreciates India's 2023 subsidy notification, which was submitted in October 2024. In addition to questions on the programs notified, the United States notes that there are several subsidy programs that were not included in India's notification that may be subject to notification.

Questions on Programs Included in India's Notification

Question 1 – Pertaining to the India's Freight Subsidy Scheme

In its description of the Freight Subsidy Scheme, India notes that the objective is "facilitate the process of industrialization in hilly, remote and inaccessible areas." What territorial areas are supported by the program?

Can India clarify why "intra-state" movement of goods is excluded under the scheme? Does that mean that the scheme applies to inter state movement of goods, export of goods, or both?

Question 2 – Pertaining to the Amended Technology Upgradation Fund Scheme

In its description of the duration of the subsidy, India notes that this is a "One-time capital subsidy for technology upgradation with prescribed rates and ceiling…" What are the rates and ceiling on the capital provided under this program?

Can India explain how rates are provided or charged in a grant program? Is this a reflection that the recipients are not creditworthy and therefore loans are appropriately characterized as grants?

Question 3 – Pertaining to The Pradhan Mantri Kisan Sampada Yojana Program

India notes that the authority providing this program is the Ministry of Food Processing Industries, but provides no further explanation of what "companies, corporations, and cooperatives may be eligible to receive the subsidy. Is this subsidy available only to food processing industries or to producers of other goods?

Question 4 – Pertaining To The Pradhan Mantri Formalisation Of Micro Food Enterprises Program

How are "micro-enterprises" defined for purpose of eligibility under this program?

Question 5 – Pertaining to the Shipbuilding Financial Assistance Policy

Could India provide more information about its Shipbuilding Financial Assistance Policy including whether there is a cap or limit on the amount of the grant provided? What types of vessels do these grants support? Are fishing vessels supported under this program?

Question 6 – Pertaining To The Scheme For Promotion Of Manufacturing Of Electronic Components And Semiconductor (Specs)

What goods are on the "list of electronic goods" that are eligible to receive the extension?

Can India confirm whether the subsidy available is 32,850 million rupees per year for five years or is 32,850 million rupees total over five years?

Question 7 – Pertaining to the Andhra Pradesh Incentives Under Industrial Development Policy 2020-2023 Program

Can India explain why it considers this program to be specific?

Are there certain sectors or goods that are targeted by this industrial development policy?

Does India set domestic or international market share goals as part of this policy?

India notes that the duration of the scheme is from "1 April 2020 to 31 March 2023." Can India confirm that this program has since expired and whether it has been replaced by another similar program?

Question 8 – Pertaining to the Gujarat Scheme for Incentive to Industries

Can India explain why, if the scheme remained applicable until July 24, 2021, there are expenditures for 2022-2023?

If expenditures are permitted past July 24, 2021, is there a date by which expenditures are no longer permitted?

Can India explain why expenditures under this scheme grew almost 500% between 2021-2022 and 2022-2023?

Can India confirm that this program has since expired?

Question 9 – Pertaining to the Gujarat Scheme for Assistance for Plastic Industries

Can India explain why, if the scheme remained applicable until August 6, 2020, there were expenditures from 2021-2022 and 2022-2023?

If expenditures are permitted past August 6, 2020, is there a date by which expenditures are no longer permitted?

Can India confirm that this program has since expired?

Question 10 – Pertaining to the Gujarat Scheme for Assistance to Labour Intensive Industries

Can India explain why, if the program expired on August 7, 2020, there were expenditures under the program for 2021-2022 and 2022-2023?

If expenditures are permitted past August 7, 2020, is there a date by which expenditures are no longer permitted?

Can India confirm that this program has since expired?

Question 11 – Pertaining to the Gujarat Scheme for Assistance of Capital Investment Subsidy and Assistance for Interest Subsidy

Can India explain the justification for the 1500% increase in assistance provided between 2021‑2022 and 2022-2023?

India notes that the scheme will remain applicable until August 6, 2025. Are expenditures permitted past that date, and if so, is there a day by which expenditures are no longer permitted?

Question 12 – Pertaining to the Jharkhand Scheme for Industrial and Investment Promotion Policy

Can India explain why, if the scheme remained applicable until March 31, 2021, there are expenditures for 2022-2023?

If expenditures are permitted past March 31, 2021, is there a date by which expenditures are no longer permitted?

Can India confirm that this program has since expired?

Question 13 – Pertaining to the Jharkhand Textile, Apparel, and Footwear Policy 2016

Can India explain why, if the scheme remained applicable until September 2, 2021, there are expenditures for 2022-2023?

If expenditures are permitted past September 2, 2021, is there a date by which expenditures are no longer permitted?

Can India confirm that this program has since expired?

Question 14 – Pertaining to the Karnataka New Industrial Policy 2020-25

Can India explain how this program is related to or supportive of the Make in India program?

Question 15 – Pertaining to the Madhya Pradesh Industrial Promotion Policy 2014

Can India identify what if any sectors are prioritized under this industrial promotion policy?

Can India explain how this program is related to or supportive of the Make in India program?

Can India confirm this program expired on March 31, 2022? If so, were there any expenditures under this program during 2023, and if so, can India explain why? If expenditures are permitted past March 31, 2022, is there a date by which expenditures are no longer permitted?

Question 16 – Pertaining to the Odisha Interest Subsidy Scheme

What are the non-MSME priority sectors that are eligible for this program? How are those sectors determined?

Question 17 – Pertaining to the Punjab Power Subsidy Scheme

Can India explain why the form of subsidy is listed as a grant? Is there no charge for the electricity provided?

Is the electricity provided under this program provided by a state-owned enterprise? If so, how is the state-owned enterprise funded?

Can India explain how it determined the funds/benefit calculation for Fy 2021-222 and 2022-23?

Questions on Programs Not Included in India's Notification

Question 1 – Production-Linked Incentive Scheme

According to press reports, India in 2020 launched a production-linked incentive (PLI) scheme to incentivize businesses to establish and grow operations in the country, which to date has provided over 1.97 trillion rupees or $23 billion to 14 sectors.[2] Why is this program not included in India's notification? Will India notify this program? Can India identify the 14 sectors that have been supported under this program?

We specifically note that there was a part of this scheme for specialty steel which is designed to increase steel production.[3] Why is India subsidizing increased production when there is global overcapacity in steel?

Question 2 – Design-Linked Incentive Scheme

According to of Ministry of Electronics and IT press release on January 16, 2022[4], there was an application for a scheme that would provide $10 billion in semiconductor incentives. Why is this program not included in India's notification? Will India notify this program? How much of this program was awarded in 2022 and 2023?

Question 3 – Pradhan Mantri Matsya Sampada Yojana

The United States requests India to provide more information on its unnotified program Pradhan Mantri Matsya Sampada Yojana (PMMSY), which is found on the official website of the Department of Fisheries, Ministry of Fisheries, Animal Husbandry and Dairying.[5] The website indicates the Government of India is implementing Pradhan Mantri Matsya Sampada Yojana, which is a scheme to bring about Blue Revolution through sustainable and responsible development of fisheries sector in India at an estimated investment of Rs. 20050 crores for holistic development of fisheries sector including welfare of fishers. PMMSY is being implemented in all the States and Union Territories for a period of 5 years from FY 2020-21 to FY 2024-25. PMMSY is designed to address critical gaps in the fisheries value chain from fish production, productivity and quality to technology, post-harvest infrastructure and marketing. It aims to modernize and strengthen the value chain, enhance traceability and establish a robust fisheries management framework while simultaneously ensuring the socio-economic welfare of fishers and fish farmers. This appears to be a subsidy program, and the United States requests that India notify it.

Could India provide information about the programs it is supporting under PMMSY and the impact on its fishers and exports?

Could India provide information on whether it supports cold storage or transportation for fisheries, including under the Pradhan Mantri Matsya Sampada Yojana?

Could India provide information on whether it provides income support for fishers and how it identifies those fishers?

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