Rajasthan Textile and Apparel Policy 2025

Rajasthan is the 4th largest cotton-producing state in the country with around 27.12 lakh bales in FY 2023, and is the largest producer of polyester viscose suiting, polyester viscose yarn and synthetic suiting material in India. It is also the largest wool-producing state, contributing 46% of the country's total wool production. The state has four well-developed textile hubs at Bhilwara, Jaipur, Pali and Balotra, is targeting new textile zones at Bhilwara and Jodhpur, and has three industrial parks under the Scheme for Integrated Textile Parks — Next Gen Textile Park Pvt Ltd (Pali), Kishangarh Hi-Tech Textile Weaving Park (Ajmer) and Jaipur Integrated Texcraft Park (Jaipur).

3.1 Policy Period

The Rajasthan Textile and Apparel Policy 2025 comes into force from the date of its notification and remains valid until March 31, 2029, or until a new or revised policy is notified, whichever is earlier.

3.2 Nodal Department

The Industries and Commerce Department is the nodal department for processing applications for incentives under the policy and for coordinating with other State Departments and agencies to facilitate the other benefits extended under it.

3.3 Textile and Apparel Focus Sub-Sectors

• •Production of Natural Fiber
• •Production of Man Made Fiber (MMF)
• •Production and Processing of Textile
• •Production of Technical Textile
• •Handloom and Textile Handicraft
• •Wool Processing
• •Production of Apparel including Garments, Made ups and Wearables
• •Processing of Leather & Leatherette
• •Manufacturing of Leather & Leatherette Products
• •Manufacturing of accessories used in Textile, Apparel, Leather & Leatherette products
• •Manufacturing of Footwear from rubber, plastic, fabric, textiles, cotton, wool, polyester, nylon, synthetics, foam and blending of any materials

3.4 Policy Objectives

• •Promote modern infrastructure and technological upgrades to strengthen the textile and apparel value chain within the state.
• •Attract investments of INR 10,000 crores and create opportunities for additional employment of up to 2 lakh people over the next 5 years.
• •Create employment generation opportunities, particularly for women, people with disability, scheduled caste, scheduled tribe and transgender category.
• •Support skill development and capacity-building initiatives to ensure a steady supply of skilled manpower for the textile industry.
• •Promote the development of 5 textile and apparel industrial parks in the state by the private sector.
• •Encourage research, development and innovation to advance eco-friendly processes and technologies in the textile sector.
• •Support the establishment of new apparel units and the expansion of existing units, with a special focus on the Readymade Garment (RMG) sector.
• •Strengthen production and value chains in technical textiles and wearables, and provide essential ancillary and backend support to these industries.
• •Promote the application of water-efficient processes and technology, use recycled and treated water, and minimise environmental impact.

Table 1: Project Category

4.1 Eligible Enterprises

• •New and existing enterprises investing in and establishing new units.
• •Existing enterprises investing minimum INR 50 crores or 25% of their existing investment, whichever is higher, and generating incremental capacity of at least 20%.
• •Enterprises acquiring an asset under liquidation or resolution proceedings by order of the NCLT under the Insolvency and Bankruptcy Code, 2016, provided they make a minimum additional investment equivalent to 25% of the acquisition cost of that asset, and provided the unit undergoing liquidation or resolution had not obtained benefits under any past RIPS.
• •Only investments made and employment generated by an enterprise in Rajasthan count as Eligible Fixed Capital Investment (EFCI) or employment for the incentives and boosters under this Policy.

4.4 Eligible Fixed Capital Investment (EFCI)

4.5 Ineligible Expenditure

• •Goodwill fees, royalty, brokerages, commission or consultancy fees paid to purchase land, building, equipment, plant and machinery.
• •Commissioning fees, technical fees or consultancy fees for setting up plant and machinery.
• •Preliminary and pre-operative expenses; interest capitalized; transportation of equipment and vehicles; working capital.
• •Consumables, spares and stores; computers, stationery items and allied office furniture.
• •All types of service charges, carriage and freight charges.
• •Any expense not specifically expressed as an eligible investment, and any other expense not approved by the PAC.

4.6 Area Category, 4.11 Employee and 4.16 Regional Anchors

a. Investment Subsidy

Reimbursement of 75% of State tax due and deposited for a period of 7 years, subject to an annual ceiling of INR 50 Cr. for years 1 to 3 and INR 65 Cr. for years 4 to 7.

b. Capital Subsidy

A fixed percentage of EFCI paid in annual instalments over 10 years post commencement of commercial production, based on project category and area category:

Capital Subsidy is subject to an annual ceiling of INR 50 Cr. for years 1 to 3, INR 65 Cr. for years 4 to 7 and INR 80 Cr. for years 8 to 10. Capital subsidy to units is paid in ten equal instalments.

c. Turnover Linked Incentive

A fixed percentage of Net Sales Turnover paid in annual instalments over 10 years post commencement of commercial production:

Turnover Linked Incentive is subject to an annual ceiling of INR 50 Cr. for years 1 to 3, INR 65 Cr. for years 4 to 7 and INR 80 Cr. for years 8 to 10.

a. Employment Booster

Enterprises generating employment greater than the minimum employment threshold stipulated in Table 1 for their Project Category are eligible for a booster over the Asset Creation Incentive amount:

b, c, d. Thrust, Regional Anchor and Interest Subvention

Captive Power Under the Regional Anchor Booster

• •100% of banking, wheeling and transmission charges waived or reimbursed — for a period corresponding to the disbursal period of the chosen Asset Creation Incentive — for captive power plants set up, provided the energy generated is used for captive consumption only with no third-party sale.
• •There shall be a ceiling of 200% on the size of the captive power plant.
• •100% banking allowed with no restrictions on withdrawals during peak hours.
• •For 'behind the meter' renewable energy plants there is no ceiling on maximum RE generation capacity, and electricity duty exemptions apply in perpetuity, provided no power is injected to the grid during off-peak hours.

5.1.4 Exemptions and Reimbursements

• •Exemption from payment of 100% electricity duty for 7 years.
• •100% exemption on electricity duty payable for seven years on Captive Renewable Energy Generation Plants.
• •Exemption from payment of 75% stamp duty and reimbursement of 25% stamp duty.
• •Exemption from payment of 75% conversion charge and reimbursement of 25% conversion charge.

5.1.5 Green Solution Incentives

To promote sustainable development of the sector, the state provides reimbursement of 50% of the cost of environmental projects up to a maximum of INR 12.5 Crores. The state decides the appropriate incentive for any emerging technology used for environment protection and sustainable production processes on a case-to-case basis.

Green Solution Areas under Clause 4.15 cover environmental infrastructure facilities — effluent treatment plants and common ETPs, reuse and recycling plants for industrial, electronic and plastic waste, augmentation and technology upgradation of existing ETPs and CETPs, common spray dryers and multiple effect evaporators, common boiler projects by SPV, cleaner production technology, pollution control equipment, continuous stack emission monitoring systems, environment management systems and laboratories, green estates and green buildings with IGBC/LEED certification — as well as water conservation solutions, energy efficiency solutions under the Rajasthan Green Rating system, and air quality and emission reduction measures the State deems fit.

5.1.6 – 5.1.8 Freight, Skill and Intellectual Property

5.2 – 5.3 MSME and Park Developers

• •5.2 Incentives for MSME: as per the Rajasthan MSME Policy 2024.
• •5.3 Incentives for Textile and Apparel Park Developers: a private industrial park developer is eligible for all the benefits and incentives mentioned in the Private Industrial Park Scheme 2025. A Textile and Apparel Park means a greenfield private industrial park for manufacturing and/or processing of goods in the focus sub-sectors that meets the minimum criteria of that Scheme.

All related Departments implement the policy, with the Industries & Commerce Department acting as nodal department for implementation, coordination and monitoring. Any matter concerning interpretation of a clause is referred to the PAC, whose decision is final. The Government reserves the right to review, revise or modify the policy in full or in part, prospectively, as required.

6.4.1 Project Evaluation Committee (PEC)

6.4.2 Project Approval Committee (PAC)

6.5 Application Process and Timelines

1. 1Application Submission — the applicant applies through a physical application or the RajNivesh portal, managed by the Bureau of Investment Promotion (BIP), for clearances and approvals for benefits and incentives under the policy.
2. 2Application Evaluation — the Project Evaluation Committee evaluates the DPR and other requisite documents and submits its recommendations to the PAC within 60 days from the date of receipt of application. The PEC may ask the applicant to appear before it to resolve queries.
3. 3Application Approval — the Project Approval Committee evaluates the project based on the PEC's recommendations and the DPR, and approves or rejects the application within 60 days from the date of receiving those recommendations. The PAC may also ask the applicant to appear before it.
4. 4Letter of Approval — on approval, the PAC issues a Letter of Approval stating the approved project cost based on approved eligible expenses, the approximate quantum of incentives under various heads, and the expected timeline for completion of the project.

8. Project Management Unit

The Industries and Commerce Department appoints a team of professionals as a Project Management Unit to ensure effective implementation. The PMU handles information dissemination through roadshows, workshops, seminars and media campaigns; identification of prospective domestic and international investors across the value chain including spun yarn, knitting, weaving, nonwovens, processing, garments, made-ups, technical textiles and ancillary sectors; one-to-one coordination with investors including business meetings and visits; assistance in mobilising proposals; evaluation and appraisal of DPRs; and monitoring and reporting on approved projects.

7.1 Phasing and Telescoping

• •Enterprises may phase their investments provided the minimum investment size for each phase exceeds INR 50 crores, with a maximum of three phases allowed.
• •For an initial Phase-1 investment made within the operative period, incentives are disbursed according to the ACI slabs for the Phase-1 investment amount.
• •On subsequent investments fulfilling the remaining commitment, benefits are based on the slab corresponding to cumulative actual investment for the remaining approved period. If cumulative investment results in an upgraded slab, the enterprise is entitled to benefits under the upgraded slab, and these accrue to investments made prior to meeting the higher slab's eligibility criteria. This applies to new and expansion investments alike.
• •Any phased investment beyond the operative period is eligible for benefits for an additional 2 years post the policy's operative period, provided at least 50% of the total investment was made during the operative period or within 2 years from grant of the LoA.

7.2 – 7.5 Transfer, Expansion, Transition and EFCI Calculation

7.6 Disbursement and Overall Caps

• •All incentives are linked to development of the project as a whole, or in respective phases where phased, per the timelines in the DPR approved by the PAC.
• •In case of cost escalation for any reason, the quantum of incentives remains as approved and stated in the LoA.
• •Capital subsidy is paid in ten equal instalments.
• •Interest subsidy is in addition to any Government of India scheme, subject to the enterprise paying a minimum of 2% of the interest after the GoI interest rate subsidy. An enterprise availing interest subsidy under another state government scheme or package is not eligible here.
• •Total interest subsidy cannot exceed the total interest liability on the term loan, covers only interest charged on the disbursed amount, and excludes penal interest, outstanding interest and other penal charges.
• •Interest subsidy runs for the duration specified in the LoA or until the loan is fully repaid, whichever is earlier, and is available for up to five years only even if the loan tenure is longer. An enterprise defaulting on EMI loses the subsidy until unpaid EMIs are cleared and the loan account is regular. Transfer of the loan to another recognised lender may allow continuation subject to PAC approval.

7.7 Other Terms and Conditions

• •All greenfield, diversifying and expanding textile and apparel enterprises are eligible for incentives per the provisions of this policy, and must comply with all statutory laws and regulations of Rajasthan — non-compliance may entail cancellation or withdrawal of benefits.
• •Benefits can only be availed if the enterprise holds effective consent to establish and operate from the Central or Rajasthan State Pollution Control Board for the relevant periods, where required by the nature of the enterprise.
• •Enterprises must, from the date of notification, maintain records of sales and purchases in digital form or as specified, and provide the PEC/PAC access to those records.
• •Where benefits are wrongly or excessively availed under this policy or under RIPS 2022 for transitioning enterprises, those benefits are disallowed and must be repaid, along with any other unit or branch, with interest at 18% per annum.
• •Where an enterprise is found ineligible or to have misrepresented facts, the matter is referred to the PAC, which provides an opportunity to be heard before withdrawing benefits with written reasons, and may order recovery with interest at 18% per annum. The same 18% rate applies on breach of any condition.
• •The PAC may rectify any mistake apparent on the record, suo moto or on application. A mistake includes an order valid when made but subsequently rendered invalid by a retrospective amendment or by a judgment of the Supreme Court or Rajasthan High Court. No rectification application may be filed after three years from the order date, and no rectification order may be made after four years from it.
• •The State Empowered Committee constituted under section 3 of the Rajasthan Enterprises Single Window Enabling and Clearance Act, 2011 hears and decides appeals against PAC orders. Appeals must be filed within 90 days of the decision being communicated.
• •Detailed step-by-step guidelines for availing incentives will be issued separately.