From Guidance to Funding to Infrastructure and What Not: The Flood of Enablers for Entrepreneurship In India!!! (Part 1/n: Government Bodies)
• Today, we stand as the third largest start-up ecosystem; we have over 80,000 recognised start-ups, while the combined valuation of Indian start-ups stands at over $450 billion, and going by all indications, we might as well have 250 unicorns in India by the end of 2025.
• A few ways in which the government of a country may push the economy towards supporting new ventures is through dedicated policies, tax relaxations, creating support organizations, and through providing a knowledge network to help entrepreneurs develop the skills and knowledge that they need to succeed.
• Government bodies are also playing an active role in building networks and communities of entrepreneurs, investors, and experts, creating opportunities for startups to connect with others and grow their businesses.
Funding: Many government bodies provide funding and grants to startups, either directly or through programs designed to support entrepreneurship and innovation. Atal Incubation Centres, MSME Samridh, ASPIRE, Biotechnology Ignition Grant (BIG) are a few examples. The government has also introduced the Fund of Funds for Startups (FFS) scheme, Startup India Seed Fund Scheme (SISFS), and Credit Guarantee Scheme for Startups (CGSS) as part of the Startup India initiative to offer funding at different phases of a startup’s business cycle. To give you an idea of how much money the government is willing to put up for developing start-ups in the country, SISFS alone has a corpus of INR 945 crores while ASPIRE has made available more than INR 194 crores to be disbursed to deserving start-ups.
Tax incentives: Government bodies offer tax incentives, such as tax credits or reductions, to startups and small businesses to help reduce their costs and encourage growth. For start-ups recognized by DPIIT, GoI has made available a tax holiday for three financial years, Angel tax exemption, given that the aggregate amount of paid-up share capital and share premium of the Startup does not exceed INR 25 Crore and Exemption from tax on Long-term capital gains. Start-ups are also allowed tax exemption on investments above fair market value, which is not available to other kinds of companies.
Regulation: Creating and enforcing regulations that affect startups and small businesses can play a key role in reducing barriers to entry and creating a supportive environment for entrepreneurship. Indian government realized the importance of creating policies at the central level to promote the entrepreneurial spirit in the Indian minds and hence came up with several initiatives like the Startup India mission, the Atal innovation Mission, the Make In India campaign, the Digital India program and several other initiatives that not only create an enabling environment but also give the regulatory push for the existing players in the ecosystem such as academic institutes, corporations etc. to help the start-ups grow. Following the lead of the central government, most state governments have also now launched their dedicated start-up policies and for once the conversation has shifted from who is more ‘corrupt’ to who is more ‘developed’ and that is a change we all wanted to see.
To give you an idea of how much money the government is willing to put up for developing start-ups in the country, SISFS alone has a corpus of INR 945 crores while ASPIRE has made available more than INR 194 crores to be disbursed to deserving start-ups.
Education and Training: Government has been using various avenues to provide educational and training programs to help entrepreneurs develop the skills and knowledge they need to succeed. Be it the Atal Tinkering Labs enabling innovative minds at the school level, or the establishment of incubation centers across domains to make mentoring available to budding entrepreneurs, or the Skill India initiative to upskill the regular youth of the society, the government has been enabling support. The government is not only working on training the startups, but it has also taken up the responsibility of training the trainer through its National Incubation Capacity Building Program.
Network building: Government bodies are also playing an active role in building networks and communities of entrepreneurs, investors, and experts, creating opportunities for startups to connect with others and grow their businesses. In February, the government of Uttar Pradesh organized the Uttar Pradesh Global Investors Summit to bring together various stakeholders from the ecosystem. The G-20 DIA National Roadshow organized under the G20 presidency of India has enabled the organization of such networking events in multiple cities of India, including Kochi, Greater Noida, Manipur, and Chennai, among many others.
Overall, government bodies have been playing a critical role in helping entrepreneurs by providing support structures, resources, and incentives that can be crucial to the success of startups and small businesses. They work to create a supportive environment that allows entrepreneurs to reach their full potential and contribute to economic growth and development. These efforts have been bearing fruit as well. Today, we stand as the third largest start-up ecosystem; we have over 80,000 recognised start-ups, while the combined valuation of Indian start-ups stands at over $450 billion, and going by all indications, we might as well have 250 unicorns in India by the end of 2025. That’s the feat a country is able to achieve when its government and regulatory systems are intent on making the ideas of its innovative minds work.
Today, we stand as the third largest start-up ecosystem; we have over 80,000 recognised start-ups, while the combined valuation of Indian start-ups stands at over $450 billion, and going by all indications, we might as well have 250 unicorns in India by the end of 2025.
That’s the feat a country is able to achieve when its government and regulatory systems are intent on making the ideas of its innovative minds work.
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