Uttar Pradesh Government Approves New Aerospace and Defence Policy to Attract Rs 50,000 Crore Investment

The Uttar Pradesh government has introduced a new policy to boost the aerospace and defence sector, aiming for Rs 50,000 crore in investments and creating 1 lakh jobs. The state cabinet, led by Chief Minister Yogi Adityanath, approved this initiative during a meeting in Prayagraj. This policy is part of ten proposals designed to accelerate the state's development.

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The Aerospace and Defence Unit and Employment Promotion Policy 2024 seeks to establish Uttar Pradesh as a leader in the sector. It aims to enhance indigenous capabilities, promote innovation, and encourage global partnerships. The policy also focuses on creating a high-tech manufacturing ecosystem within the UP Defence Industrial Corridor (UPDIC).

Aerospace and Defence Sector Growth

The policy encourages the establishment of artificial intelligence and software development centres. It targets Rs 50,000 crore in investments over five years, promising employment for 1 lakh youth. Incentives include subsidies for A&D units, land subsidies, stamp duty exemptions, and capital subsidies.

To support foreign investment, a new FDI policy was approved. It offers up to 80% land subsidy for foreign firms setting up in Uttar Pradesh. This move aims to boost industrial growth and economic development in the state.

Investment Incentives and Reforms

The UP government plans to attract startups and investments for advanced facilities in the aerospace and defence sector. Common facility centres will be established to enhance skills of startups and MSMEs within UPDIC. The policy also aims to attract large manufacturing projects and DPSUs.

The Ministry of Defence has set ambitious targets to double A&D production to USD 25 billion by 2025-26. By 2047, the sector is expected to contribute 25% to India's GDP. Two defence corridors have been established in India, with Uttar Pradesh positioned as a key player.

Key Projects and Subsidies

The Cabinet approved subsidy payments for land allotted to Ashok Leyland Ltd under the Incentive Policy 2023. This project will initially produce 2,500 buses annually with an estimated cost of Rs 186 crore. The Empowered Committee's recommendation from September was accepted.

Special facilities have been sanctioned under the Industrial Investment and Employment Promotion Policy 2022 for mega-category industrial units. Rs 250 crore has been approved as a capital subsidy for Triveni Engineering in Moradabad, along with Rs 10,749 crore as SGST reimbursement for Gallant Ispat Ltd in Mirzapur.

Chief Minister Adityanath emphasised that the policy aligns with India's vision of self-reliance in aerospace and defence. Special provisions are included for women entrepreneurs to encourage their participation in this sector.

The new policies aim to position Uttar Pradesh as a significant contributor to India's aerospace and defence landscape while fostering economic prosperity through strategic investments and reforms.