The Gujarat government is considering a proposal to grant a minimum double floor space index (FSI) to industries located within city limits that relocate outside. In addition, charges levied for conversion and FSI changes are expected to be waived, according to top sources in the state government.
THRIVE Scheme Announced
On Monday, the Gujarat government announced the THRIVE (Transition for Harmonized Relocation and Inclusive Vibrant Economy) scheme, which offers incentives for industries within municipal corporation areas to shift outside city limits. Officials from the industries and mines, urban development, and finance departments have begun consultations to determine the exact FSI to be granted under the scheme.
“The government has taken an in-principle decision that a minimum double FSI will be granted to such industries,” said a top source. Currently, industries that relocate outside are granted an FSI of 1.2. “The proposed FSI will be 2.5 or even higher to encourage industries to relocate outside city limits,” the source added.
Industry Reactions and Concerns
Industry leaders have reacted cautiously, emphasizing that infrastructure at relocation sites is essential for the scheme’s success. They also prefer not to be relocated too far from cities. Ajay Patel, chairman of the GIDC committee of the Gujarat Chamber of Commerce and Industry (GCCI), noted that nearly 5,000 industrial units operate in Ahmedabad’s Naroda, Vatva, Odhav, and Kathwada GIDCs, reflecting significant city-based industrial activity.
“The state has developed estates farther away, such as Saykha, but not many units have shifted from the city, mainly due to infrastructure issues,” Patel said. He suggested a practical path: establish a new facility in the new estate, stabilize production, workforce, and supply chains, and only then phase out the older unit. “That transition demands certainty, timelines, and adequate support,” he added.
Ankit Patel, former president of Vatva Industries Association, said, “If MSMEs are given an option within 100km of the city with environmental infrastructure and faster regulatory clearances, then relocation will be a success.” A director of a leading company added, “The focus must shift from merely allocating land to delivering industry-ready infrastructure — power, water, roads, drainage, connectivity, and clear regulatory support.”
Additional Incentives
Other announcements under the THRIVE scheme include a wage support subsidy of Rs 5,000 per employee per month for six months, and a capital subsidy for setting up industrial parks and common environmental infrastructure facilities.
