Centre Launches ₹1,000 Crore ADEETIE Scheme to Boost Energy Efficiency in MSMEs

In a landmark step towards decarbonising India’s industrial growth and empowering the country’s micro, small and medium enterprises (MSMEs), the Ministry of Power has launched the ADEETIE scheme (Assistance in Deploying Energy Efficient Technologies in Industries and Establishments). With a central outlay of ₹1,000 crore, the national initiative aims to accelerate the transition of Indian industries especially MSMEs to advanced energy-efficient technologies.

Spearheaded by the Bureau of Energy Efficiency (BEE), the ADEETIE scheme was rolled out from Panipat, and is now set to be scaled across India through the engagement of State governments and designated industrial agencies. The scheme positions energy efficiency as a growth driver, not just a compliance metric, offering MSMEs a unique pathway to reduce operating costs, boost productivity and enhance sustainability.

“ADEETIE is a big boon to the MSME sector,” said Akash Tripathi, Additional Secretary at the Ministry of Power and Director General, BEE. “We appeal to all States to act fast and harness this opportunity to future-proof their industries.”

₹875 Crore in Interest Subvention for Green Technology Financing

The scheme is financially structured to address one of the biggest bottlenecks for MSMEs: access to affordable capital for green upgrades. Out of the ₹1,000 crore budget, ₹875 crore has been allocated as interest subvention, enabling MSMEs to secure concessional loans for investing in cutting-edge energy-efficient technologies. Another ₹50 crore is earmarked for capacity building, implementation support, and stakeholder training.

“We are not just offering finance we are de-risking the energy transition for small industries,” noted A. Chandrasekhara Reddy, Media Advisor (South) to BEE. He added that the scheme is expected to catalyse over ₹9,000 crore in total investments, including contributions from MSMEs themselves.

Targeted Rollout Begins with Key Industrial Clusters

As part of its initial deployment, the Ministry has identified five high-impact states for immediate implementation, Telangana, Gujarat, Karnataka, Goa and Himachal Pradesh with sectoral pilots focusing on industries like pharmaceuticals, textiles and engineering goods.

In Telangana, the ADEETIE scheme will focus on Medak’s pharma manufacturing belt, aligning with the region’s growing prominence in bulk drugs and formulation exports. Other early beneficiaries include Baddi (Himachal Pradesh), Ahmedabad (Gujarat), Madgaon (Goa) and Bidar (Karnataka) clusters known for energy-intensive sectors like chemicals, food processing and heavy engineering.

States Urged to Mobilise SDAs for Rapid Execution

To ensure seamless implementation, BEE has formally called upon State Designated Agencies (SDAs) to conduct outreach programs, mobilise eligible MSME units and coordinate ground-level execution of energy audits, technology upgrades and financial facilitation. States have been encouraged to proactively engage local industry bodies, cluster development agencies and public sector banks to ensure high uptake.

“This is not just a scheme it’s an industrial transformation strategy,” said Milind Deora, Secretary of BEE. “States must treat it as a mission-mode project to make their MSMEs globally competitive.”

Why ADEETIE Matters

India’s MSME sector accounts for over 45% of industrial output and nearly 40% of the country’s exports. Yet, a large majority of small and medium units continue to rely on outdated, energy-inefficient machinery. With rising energy prices and growing international pressure on ESG compliance, ADEETIE offers a critical lifeline for MSMEs to modernise operations, lower emissions and tap into new export markets demanding sustainable supply chains.

The scheme also aligns with India’s broader commitments under the Nationally Determined Contributions (NDCs) and the net-zero roadmap for 2070, where energy efficiency in industry remains a key pillar.