UP to Modify Policy for Defence Corridor

Defence Industry

New Delhi. Uttar Pradesh government plans to modify its policy for the upcoming ‘defence corridor’ to make arms, ammunition and explosives manufacturing eligible for incentives and attract small and medium enterprises as well as foreign and domestic investors seeking to meet their offset obligations.

The foundation stone of the corridor which is to come up on over 5,000 hectares around the six nodes of Lucknow, Kanpur, Agra, Aligarh, Jhansi and Chitrakoot was laid by Prime Minister Narendra Modi and investments worth Rs 4,000 crore have already been received and the project is expected to attract Rs 20,000 crore.


The incentives planned for companies include upfront payment of 10% for land, with the rest payable over 10 years at 12% simple interest, and reimbursement of 25% of the land cost at the purchase rate rather than the cost or circle rate.

Higher incentives are also on the anvil. For new projects and expansion, investments up to Rs 10 crore are proposed to be given a back ended capital subsidy at the rate of 10% for anchor units and 5% for vendor and MSME units.

Units established in the Bundelkhand region of the state will be provided an additional capital subsidy of 50% over and above these limits. Aircraft maintenance, repair and overhaul could get 50% reimbursement of state goods and services tax.

Government identifies five nodal points in Tamil Nadu Defence Corridor

big bang

The Government has identified five nodal points in Tamil Nadu for setting up the Defence Corridor in the state which includes Salem as also four other nodes which are Chennai, Coimbatore, Hosur and Tiruchirappalli.

Till date, six consultation meetings of stakeholders were organized across various nodes of Tamil Nadu. At the Tiruchirappalli meeting of January 20, an investment of over Rs.3100 crore were announced by OFB and DPSUs and private industries for Tamil Nadu Defence corridor.


Government has also appointed a consultant for the preparation of Detailed Project Report for the Defence Corridor.