To facilitate the process of industrialization in hilly, remote and inaccessible areas, transport incentive is provided to the states of:

  • North Eastern Region (including Sikkim) under North Eastern Industrial Development Scheme (NEIDS) – 2017
  • Jammu & Kashmir under Industrial Development Scheme –2017
  • Lakshadweep and A&N Islands under Lakshadweep and Andaman & Nicobar Island Development Scheme – 2018

About Transport Subsidy Scheme –Government of India had introduced Transport Subsidy Scheme (TSS) on 23.7.1971 to develop industrialization in the remote, hilly and inaccessible areas.

The objective is to develop industrialization in the remote, hilly and inaccessible areas in 8

North Eastern Region.

DIPP (Department of Industrial Policy and Promotion) (The name of the Department of Industrial Policy and Promotion (DIPP) has been changed as Department for Promotion of Industry and Internal Trade (DPIIT)) is the implementing agency of TSS/FSS.

Industrial Units can avail Incentives:

Under the above mentioned schemes, all eligible industrial units can avail incentive on transportation of only finished goods through Railways or the Railway Public Sector Undertakings, Inland Waterways or schedule airline (shipping for Andaman & Nicobar and Lakshadweep islands also) for five years from the date of commencement of commercial production/operation.

Freight Subsidy Scheme (FSS):

  • The FSS (2013) replaced the Transport Subsidy Scheme, 1971.
  • It was in operation in all 8 North Eastern States, Himachal Pradesh, Uttarakhand, J&K, Darjeeling District of West Bengal, Andaman & Nicobar Islands and Lakshadweep islands.
  • The FSS has been discontinued since 22.11.2016. But, the industrial units under these schemes during their currency are eligible for the benefits of the scheme.
  • While the inland transport incentive is available for certain landlocked states, there is no proposal to provide the same to the state of Chhattisgarh.