The Punjab government has reversed its controversial industrial application fee structure, slashing upfront costs for investors after facing strong opposition from manufacturing groups. In a newly issued corrigendum to the Detailed Schemes and Operational Guidelines, 2026, the industries and commerce department amended a clause that had threatened to stall new investments. The state replaced the requirement for investors to pay the higher of two fee options with a lower cost cap, effectively capping application fees at ₹1 lakh.
Policy Pivot
Under the original policy, investors were required to pay a non-refundable fee of either ₹1 lakh or 0.5% of their fixed capital investment (FCI), whichever was higher. For large-scale projects, this meant application costs could have spiraled into a few crore rupees. The amended rule now mandates the lower of the two figures, providing significant financial relief to both existing firms and new entrants.
Industry Response
The amendment follows sustained pressure from trade bodies, including the Federation of Industrial and Commercial Organisations (FICO), which argued the initial fee structure acted as a deterrent to growth. FICO president Gurmeet Singh Kular stated, "The high upfront fee would have discouraged the small industry in particular from investing." Ashpreet Singh Sahni, FICO's organizing secretary, described the change as a welcome move, noting that the ₹1 lakh ceiling makes the state's industrial policy bearable for local entrepreneurs.
Funding Restructuring
While the application fee has been capped, the government has restructured how technical audits are funded. The application fee remains payable online via the Industrial Common Application Form (I-CAF). However, the fee will no longer absorb the audit costs for empanelled chartered accountants, who are tasked with verifying investment claims. Applicants must now pay chartered accountants separately at the time of submission, over and above the capped state fee. This move is seen as an attempt by the state government to balance ease of doing business with a robust verification process for industrial subsidies.
