Punjab Introduces Capital Subsidy Scheme to Combat Stubble Burning and Energize Industry
The government has allocated Rs 60 crore for this fiscal year to support the scheme.
Chandigarh: In a major push toward environmental sustainability and industrial advancement, the Punjab government has rolled out a groundbreaking subsidy scheme to encourage the adoption of paddy straw-based boilers in industries. The move is seen as a critical step in reducing stubble burning, which remains a persistent environmental challenge across the state.
Announcing the initiative, Industry Minister Tarunpreet Singh Sond stated that amendments have been made to the Industrial and Business Development Policy 2022, allowing for substantial financial incentives to industrial units that either switch to or install new boilers powered by paddy straw. This announcement follows a cabinet decision made in February this year, with the official rollout beginning in April.
Under the scheme, existing industrial units that adopt paddy straw boilers will receive a capital subsidy of Rs 1 crore per 8 TPH unit, or 33% of actual costs, whichever is lower, capped at Rs 5 crore per project. Industries upgrading their current systems will get Rs 50 lakh per 8 TPH unit, subject to a maximum of Rs 2.5 crore. Higher-capacity installations will be eligible for proportionate subsidy allocation.
“Industries in Ludhiana and similar boiler-intensive hubs stand to benefit significantly from this policy,” said Sond. An estimated 500–600 units across Punjab are expected to qualify. The government has allocated Rs 60 crore for this fiscal year to support the scheme.
Further perks include full stamp duty exemption for land acquired for straw storage and 100% net State GST reimbursement (capped at 75% of investment) for a period of seven years.
Highlighting the state’s intent, the Minister remarked, “This is more than an industrial policy, it's a green mission. We’re aligning growth with responsibility.”
Industries wishing to take part must furnish a Consent to Establish certificate issued by the Punjab Pollution Control Board dated after February 20, 2025. However, the initiative currently applies only to existing industrial units, not new ventures. All applications will be processed on a first-come, first-served basis.
If a unit fails to operate the subsidized boilers using paddy straw for at least five years, the subsidy may be reclaimed.
With this move, Punjab takes a bold stride in turning a pollution crisis into a fuel opportunity, helping farmers, industries, and the environment thrive in unison.