The incentives provided by the government are as follows:
1. Land.: Developed Tots are offered by every state for establishing industries.
2. Power: Some states supply power at a concessional rate of 50%, while some give it free of cost during the initial years.
3. Water : Water is either supplied at 50% concession or is totally free for a period of 5 years.
4. Finance : Small business units are offered loans at a very low rate of interest i.e. 10 to 15% subsidy is given for building capital assets.
5. Sales tax: Exemption from sales tax is extended by some states for a period of 5 years while all muon territories provide full exemption from sales tax. It is also known as Value Added Tax (VAT).
6. Raw material: Units located in backward areas get preferential treatment in the matter of allotment of scarce raw materials like cement, iron, steel, etc.