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How to Obtain Agarbatti Making License

Narendra Kumar

| Updated: Mar 17, 2018 | Category: Startup

Agarbatti Making

Agarbatti Making which is worldwide known as “Incense Sticks” termed as thin bamboo sticks coated with a paste of fragrance of natural ingredients extracts of scented flowers. The length of the sticks is almost about 8 to 12. Since early times it is practiced in India, the burning of Agarbatti in religious and social functions. In many cultures, it is also used as a source of relaxation and spiritual purposes.

Market of Agarbatti

It is one of the labor-intensive cottage types of traditional industries in India. Moreover, it is also considered an export-oriented industry[1]. It can be initiated on a Small or large scale basis. It is used by all communities in India and as well as by Indians residing abroad. The scope and production of Agarbatti Making depend upon the capability of the individual. This industry has a huge potential as its demand remain high all the time and in the festival season, it goes even higher.

India is exporting over Rs 400 crore worth of sticks in 16-17. The exports seem like a jump of over 30 % from five years ago period. Currently, India is exporting to the UK, Brazil, and Argentina etc.

There are approximate, 5000 Agarbatti Making companies in India, in which more than 2, 00,000 women are employed.


Initially, after the implementation of GST, 12% is charged but later on, it has been reduced to 5%.

Points to be considered before initiating this business

  • Selection of correct area- This business involves various subcategories; the applicant has to select the correct area as per their capability to make a profit.
  • Business Plan: It is a very important step, in setting up business. It should be made with accuracy from This will help in getting an idea either you have to take loans or need a small investor for making the investment.
  • The decision for suppliers for business: This decision wholly depends upon the category of business selected by the applicant and how they made.
  • How to connect buyers: The applicant needs to take a wise decision, how to reach targeted buyers either through online mode, local markets, mall or any other mode.
  • A decision either to make or export: Applicant is required to take a decision on the basis of his supplier, capability, investment either to make its own brand name incense or to import from another country.
  • The raw material for making Agarbatti: Before commencing this business applicant need to make arrangement for the raw It basically depends upon the amount of investment involved.
  • Machinery for making Agarbatti: Applicant needs to make a sound decision for selecting the appropriate type of machinery as per their requirement.

Steps to Manufacture Agarbatti         

Licenses and Permits Required in Incorporating this Business

  • Company Registration: The first step in commencing business to establish it as an artificial legal entity either in the form of the firm, Limited Liability Partnership or company. The applicant needs to determine as per the legal pattern and register accordingly.
  • GST Registration: After the implementation of GST, it is mandatory for every business carrying out a taxable supply of goods or services and whose turnover exceeds the threshold limit to register under GST and obtain GST number.
  • PF Registration: If there are more than 20 employees in the company or manufacturing unit, then it is obligatory upon the unit management to obtain EPF registration.
  • ESI Registration: It is mandatory in India for all Businesses that employ 10 or more employees to obtain Employee State Insurance (ESI) Registration.
  • Trade License: It is mandatory for the applicant to take a trade license from the local authority for operating in that city.
  • SSI Registration: The applicant is not compulsory obliged to take SSI registration, they may apply for the registration for being an SSI unit.
  • Pollution Certificate: It is mandatory for every establishment before commencing its activity to obtain No Objection Certificate from the State Pollution Control Board
  • Factory License: It is mandatory for the commercial large-scale manufacturing unit to Obtain a Factory License.


As per considering, the benefits of this industry an investor who wants to make an investment in this business may raise their queries on info@enterslice.com.

Narendra Kumar

Experienced Finance and Legal Professional with 12+ Years of Experience in Legal, Finance, Fintech, Blockchain, and Revenue Management.

Business Plan Consultant

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