A Complete Guide on How to Get Government Grants for Ayurvedic Manufacturing Units in India

The Ayurveda industry in India is experiencing a remarkable resurgence, fueled by a global shift towards natural and holistic wellness. Consumers are increasingly seeking traditional, time-tested solutions for health and well-being, creating a massive opportunity for entrepreneurs. Recognizing this potential, the Indian government, through the Ministry of AYUSH and other dedicated bodies, is actively promoting the sector’s growth. If you are an entrepreneur looking to enter this thriving market, this article is your comprehensive guide on how to secure government grants for Ayurvedic manufacturing and turn your vision into a successful reality.

Understanding Why the Government is Funding Ayurvedic Units

Before diving into the specific schemes, it’s essential to understand the government’s motivation for supporting this sector. This support isn’t just about preserving tradition; it’s a strategic move with significant economic and cultural implications. The push for government funding for Ayurvedic units in India is rooted in several key national objectives that make this a priority sector.

At the forefront is the ‘Make in India’ initiative, which aims to transform India into a global manufacturing powerhouse. Promoting the domestic production of Ayurvedic medicines aligns perfectly with this goal, leveraging India’s unique heritage and knowledge base to create world-class products. The Ministry of AYUSH (Ayurveda, Yoga & Naturopathy, Unani, Siddha and Homoeopathy) is the nodal agency spearheading this mission. Its primary objective is to promote, regulate, and standardize traditional Indian medicine systems. By providing financial assistance, the ministry encourages manufacturers to adopt modern technology, adhere to stringent quality control, and scale their operations. Furthermore, the economic impact is undeniable. A thriving Ayurvedic manufacturing ecosystem creates thousands of jobs, from skilled researchers and pharmacists to factory workers and marketing professionals. It also holds immense export potential, positioning India as a global leader in the wellness industry and contributing significantly to the national economy.

Key Schemes Offering Ayurvedic Manufacturing Grants in India

Navigating the landscape of government support can seem daunting, but several key schemes are specifically designed to provide Ayurvedic manufacturing grants in India. These are broadly categorized under the Ministry of AYUSH and general MSME schemes that most Ayurvedic startups can leverage.

Ministry of AYUSH Schemes

The Ministry of AYUSH is the primary source of direct support for the sector. Its schemes are tailored to address the unique needs of Ayurvedic manufacturing, from infrastructure development to achieving international quality standards.

• Central Sector Scheme for Promotion of AYUSH: This is a flagship scheme with a broad mandate to support the entire AYUSH ecosystem. A key component of this scheme is providing financial assistance for upgrading manufacturing units, setting up advanced quality control laboratories, and investing in research and development (R&D). The goal is to enhance the quality, safety, and efficacy of Ayurvedic products, making them competitive in both domestic and international markets.
• Champion Services Sector Scheme (CSSS) for Medical Value Travel: While this scheme has a broader focus on promoting India as a medical tourism hub, it has a crucial component for manufacturing. It provides substantial financial assistance (grants-in-aid) to AYUSH entrepreneurs for upgrading their facilities to meet prestigious international standards, such as the World Health Organization’s Good Manufacturing Practices (WHO-GMP). Achieving this certification is a gateway to exporting products and building a globally recognized brand.

Actionable Tip: For the most current guidelines, eligibility criteria, and application forms, it is highly recommended to visit the official Ministry of AYUSH schemes page.

Schemes for Micro, Small & Medium Enterprises (MSMEs)

Most Ayurvedic manufacturing startups begin as MSMEs. This is a significant advantage, as it unlocks access to a wide range of powerful, credit-linked government schemes that are not specific to AYUSH but are highly beneficial. To explore more options, see our guide on the Top 10 Government Schemes for Startups in India You Shouldn’t Miss in 2025.

• Prime Minister’s Employment Generation Programme (PMEGP): This is one of the most popular schemes for new entrepreneurs. It is a credit-linked subsidy program where the government provides a “margin money subsidy” on the project cost, effectively reducing the loan burden. The subsidy amount varies based on the applicant’s category and the unit’s location.

Category of Beneficiary	Beneficiary’s Share (of Project Cost)	Subsidy Rate (Urban)	Subsidy Rate (Rural)
General Category	10%	15%	25%
Special Category (including SC/ST/OBC/Minorities/Women)	5%	25%	35%

The maximum project cost allowed for the manufacturing sector is ₹50 lakhs. You can apply for this scheme through the official KVIC PMEGP e-Portal.

• Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE): One of the biggest hurdles for new entrepreneurs is arranging collateral for bank loans. The CGTMSE scheme solves this problem by providing a guarantee to the lending bank, enabling startups to secure collateral-free loans of up to ₹5 crore. This is not a direct grant but an essential enabler that makes bank financing accessible.

Actionable Tip: To avail any MSME-related benefits, Udyam Registration is mandatory. It is a simple, free, online process that gives your business a recognized identity as an MSME. You can register on the official Udyam Registration Portal.

State-Level Industrial Policies

Beyond central government schemes, do not overlook the support offered by your state government. States with a strong tradition in Ayurveda, such as Kerala, Uttarakhand, Gujarat, and Uttar Pradesh, often have dedicated industrial policies that provide additional incentives. These can include capital investment subsidies, interest subvention on loans, stamp duty exemptions, and discounted land for setting up units.

Actionable Tip: Visit the website of your state’s District Industries Centre (DIC) or the State Industrial Development Corporation to find detailed information on policies specific to your region.

Step-by-Step Guide: How to Get Ayurvedic Grants in India

Understanding the schemes is the first step. The next is to prepare meticulously and follow a structured application process. This roadmap will guide you on how to get Ayurvedic grants in India efficiently.

Step 1: Create a Solid Business Foundation

Before you can apply for any grant or loan, your business must exist as a formal legal entity. Ad-hoc operations will not qualify for government support. You need to choose a business structure like a Private Limited Company, a Limited Liability Partnership (LLP), or a Partnership Firm. For a deeper dive, our guide on Choosing the Right Legal Structure for Your Business can be very helpful. A Private Limited Company is often preferred as it projects a professional image, offers limited liability to its owners, and makes it easier to raise funds in the future.

TaxRobo CTA: Choosing the right structure is a critical first decision that impacts your taxation, compliance, and fundraising ability. TaxRobo can help you choose the right business structure and complete the registration process seamlessly.

Step 2: Secure Essential Licenses & Certifications

The Ayurvedic sector is regulated to ensure public health and safety. You must have all the required licenses in place before you even think about applying for funding.

• AYUSH Manufacturing License: This is the most crucial license, issued by your state’s AYUSH department. It certifies that your manufacturing facility complies with the prescribed norms.
• Good Manufacturing Practice (GMP) Certification: While mandatory, aiming for WHO-GMP certification is highly recommended. It is a prerequisite for many high-value grants and essential for export markets.
• GST Registration: As a manufacturer, you are required to register for the Goods and Services Tax (GST) to manage your tax liabilities and issue valid invoices. Our Ultimate Guide to GST Registration for Small Businesses provides a complete walkthrough. You can register on the GST Portal.
• Udyam (MSME) Registration: As mentioned earlier, this free registration is your gateway to all MSME-specific schemes like PMEGP and CGTMSE.

Step 3: Prepare a Compelling Detailed Project Report (DPR)

Your Detailed Project Report (DPR) is the single most important document in your application. It is your business plan on paper and must be thorough, professional, and convincing. It demonstrates to the financial institution or government agency that your project is viable and you have a clear plan for success. A strong DPR is the key to securing funding for Ayurvedic manufacturing units in India.

A comprehensive DPR should include:

• Executive Summary: A brief overview of your business and goals.
• Promoter’s Background: Details about your experience and expertise.
• Market Analysis: Research on your target market, competition, and growth potential.
• Manufacturing Process: A detailed breakdown of your production methods.
• Technical Details: Information on the required machinery, equipment, and raw materials.
• Financial Projections: This is the core of the DPR, including projected profit & loss statements, cash flow statements, and balance sheets for at least 3-5 years.
• Funding Requirement: A clear breakdown of how the grant or loan will be utilized.

TaxRobo CTA: A professionally prepared DPR can significantly increase your chances of approval. Our experts at TaxRobo can assist you in creating a bank-ready DPR that highlights the strengths of your project.

Step 4: Application and Follow-up

Once your business is registered, licenses are in place, and your DPR is ready, you can proceed with the application.

1. Identify the Right Scheme: Based on your project size and needs, choose the most suitable scheme from the list above.
2. Apply Online: Most government schemes now have dedicated online portals for applications (e.g., PMEGP portal, Udyam portal).
3. Submit Documentation: Carefully upload all required documents. This typically includes KYC documents of promoters, business registration certificates, licenses, the DPR, and quotations for machinery. Meticulous documentation is key to avoiding delays.
4. Proactive Follow-up: After submission, don’t just wait. Regularly check the status of your application on the portal. If the bank or agency requests additional information, respond promptly and professionally.

Conclusion: Start Your Ayurvedic Manufacturing Journey Today

The path to building a successful Ayurvedic manufacturing unit is paved with opportunities, largely thanks to the proactive support from the Indian government. While the process of securing government grants for Ayurvedic manufacturing requires diligence, planning, and persistence, it is an achievable goal that can provide the critical financial impetus your business needs to launch and scale. By following a structured approach—forming a proper legal entity, obtaining the necessary licenses, creating a robust Detailed Project Report, and applying to the right schemes—you can unlock the support needed to thrive in this high-growth sector.

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Frequently Asked Questions (FAQs)

Q1. What is the basic eligibility to apply for an Ayurvedic business funding grant in India?

A: Typically, you need to be an Indian citizen above 18 years of age with a registered business entity (like a Pvt Ltd or LLP). You must also have a well-prepared Detailed Project Report (DPR) and possess, or be in the process of obtaining, the mandatory AYUSH manufacturing license. Specific criteria can vary significantly from one scheme to another, so always read the official guidelines.

Q2. Are these grants given as direct cash, or are they different?

A: It’s a mix. Government support comes in various forms. Schemes like PMEGP offer a “margin money subsidy,” which is a grant that reduces the total loan amount you need to repay to the bank. Schemes under the Ministry of AYUSH can be direct grants-in-aid for specific purposes like upgrading machinery. Others, like CGTMSE, are not direct cash but are “enablers” that provide a guarantee to banks, helping you get collateral-free loans.

Q3. Can I apply for multiple government grants at the same time?

A: You can explore and apply for multiple schemes, but you generally cannot claim a subsidy or grant for the same purpose or component (e.g., funding for the same piece of machinery) from two different central government schemes simultaneously. For instance, you cannot claim a subsidy for a machine under a Ministry of AYUSH scheme and also under the PMEGP scheme. It’s wise to consult with a financial advisor to create a funding strategy that leverages different schemes for different aspects of your project.

Q4. How much funding can I expect to receive for my Ayurvedic unit?

A: The amount of government funding for Ayurvedic units in India depends entirely on the scheme and the scale of your project. For example, under the PMEGP, the maximum project cost for the manufacturing sector is ₹50 lakhs, with the subsidy ranging from 15% to 35% of this cost. For schemes like the Champion Services Sector Scheme, the financial assistance can be significantly higher for units aiming for WHO-GMP certification and export readiness. Your DPR will play a crucial role in justifying the amount of funding you are requesting.