Lok Sabha Question No. 103 (UNSTARRED), answered on 2022-12-07
Subject: ESG Focussed Startups
Ministry: COMMERCE AND INDUSTRY
Asked by: S. Jothimani

## GOVERNMENT OF INDIA MINISTRY OF COMMERCE & INDUSTRY DEPARTMENT FOR PROMOTION OF INDUSTRY AND INTERNAL TRADE

## LOK SABHA

## 103.   MS. S. JOTHIMANI:

Will the Minister of COMMERCE AND INDUSTRY be pleased to state: वाणिज्य एवं उद्योग मंत्री

- (a) the steps taken/intends to be taken by the Government to encourage more startups in the fields of climate change and agriculture;
- (b) the steps taken/intends to be taken by the Government to support and incentivise Indian startups to be more Environment, Social and Governance (ESG) focussed;
- (c) whether the Government intends to modify education curriculums across school, under-graduate and graduate levels to mandatorily teach ESG concepts and if not, the reasons therefor;
- (d) the  rules/guidelines  laid  down/proposed  to  be  laid down  by  the Government  to prevent companies (especially startups) from greenwashing their activities; and
- (e) the steps taken by the Government to promote Indian ESG ventures and attract international finance?

## ANSWER

## वाणिज्य एवं उद्योग मंत्रालय में राज्य मंत्री ( श्री सोम प्रकाश ) THE MINISTER OF STATE IN THE MINISTRY OF COMMERCE & INDUSTRY (SHRI SOM PARKASH)

- (a), (b) and (e): The  Government  with  an  intent  to  build  a  strong  ecosystem  for nurturing innovation and startups in the country launched Startup

India initiative on 16th January 2016.

In  order  to  meet  the  objectives  of  the  initiative,  the  Government unveiled an Action Plan for Startup India that laid the foundation of Government support, schemes and  incentives envisaged to create a  vibrant  startup  ecosystem  in  the  country.  The  Action  Plan comprises  of  19  action  items  spanning  across  areas  such  as

UNSTARRED QUESTION NO. 103.

TO BE ANSWERED ON WEDNESDAY, THE 07 TH  DECEMBER, 2022.

## ESG FOCUSSED STARTUPS

'Simplification and handholding', 'Funding support and incentives' and 'Industry-academia partnership and incubation'.

Sustained  Government  efforts  in  this  direction  have  resulted  in increasing the            number of recognized Startups from 452 in 2016 to 84,012 in 2022 (as on 30th November 2022).

To encourage startups in the field of climate change, Ministry of New and Renewable Energy (MNRE) supports a scheme 'Renewable Energy Research and  Technology Development Programme'  through  various  research  institutions,  startups  and industry to enable indigenous technology development and manufacture for wide spread applications of  new and renewable energy in efficient and cost-effective manner across the country with the ultimate aim of increasing share of renewables in the energy mix in the country.

MNRE  also  encourages  research  and  technology  development proposals  in  collaboration  with  the  industry  and  provides  up  to 100% financial support to Government/non-profit research organizations  and  50%  to  70%  to  industry,  startups,  private Institutes, entrepreneurs and manufacturing units.

To  encourage  startups  in  the  field  of  agriculture,  Ministry  of Agriculture & Farmers Welfare is implementing programme called Innovation and AgriEntrepreneurship Development under Rashtriya Krishi Vikas Yojana (RKVY-RAFTAAR) since 2018- 19 with an objective to promote innovation and agri-entrepreneurship by  providing  financial  and  technical  support  for  nurturing  agri startups  in  an  incubation  ecosystem  including  digital  solutions  in agriculture. Five Knowledge Partners (KPs)  as Center of Excellence and  24  RKVY-RAFTAAR  Agribusiness  Incubators  (RABIs) have been appointed from across the country for implementation of this programme.

Under  the  Innovation  and  Agri-Entrepreneurship  Development programme, a total of  799  startups  in  the  field  of  agriculture  and allied sectors including agritech startups  have  been  provided technical and financial support.

Besides,  the  Indian  Council  of  Agriculture  Research  (ICAR)  has been  supporting  Agri-based  startups  under  the  project  called National Agriculture Innovation Fund (NAIF) initiated in year 20162017. It has two components viz. I. Innovation Fund; II. Incubation Fund and National Coordinating Unit (NCU). Under NAIF scheme, ICAR  Agribusiness  Incubators  provide  easy  accessibility  to  new

|      | technologies and other incubation services to startups /entrepreneurs. In addition to the above, the various measures undertaken by the Government under Startup India initiative to support startups across                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (c): | As per the Ministry of Education (MoE), the concerns, concepts and issues related to Environment, Social and Governance (ESG) are included in the existing school curriculum. As such, the curricular materials prepared by National Council of Educational Research and Training (NCERT) incorporate such concerns adequately across all subjects at all stages of school education. NCERT has also prepared supplementary materials for students and teachers related to environmental education. National Education Policy (NEP) 2020 also stresses upon appropriate integration of environmental awareness and sensitivity towards its conservation and sustainable development in school curricula. MoEalso organises Smart India Hackathon and National Innovation Contest which include Environment/ Sustainability and Agriculture as one of the themes for seeking good ideas and innovations from students of higher educational institutions. 75 ideas has been financially supported in different themes having startup potential from various editions of Smart India Hackathon and National Innovation Contest. |
| (d): | To address the concern of greenwashing, the Securities and Exchange Board of India (SEBI) has proposed a regulatory framework to regulate ESGRating Providers (ERPs). SEBI has also constituted an advisory committee for advising on ESG-related matters in the securities market.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |

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## ANNEXURE-I

ANNEXURE REFERRED TO IN  REPLY TO PARTS (a), (b) AND (e) OF THE LOK  SABHA  UNSTARRED  QUESTION  NO.  103  FOR  ANSWER  ON 07.12.2022.

## Programs Launched under Startup India initiative

The details of various programs undertaken by the Government to promote startups under Startup India initiative across the country are as under:

1. Startup India Action Plan :  An Action Plan for Startup India was unveiled on 16 th January 2016. The Action Plan comprises of 19 action items spanning across areas such  as  'Simplification  and  handholding',  'Funding  support  and  incentives'  and 'Industry-academia partnership and incubation'. The Action Plan laid the foundation of  Government  support,  schemes  and  incentives  envisaged  to  create  a  vibrant startup ecosystem in the country.
2. Fund of Funds for Startups (FFS) Scheme : The Government has established FFS with corpus of Rs. 10,000 crore, to meet the funding needs of startups. DPIIT is the monitoring agency and Small Industries Development Bank of India (SIDBI) is the operating agency for FFS. The total corpus of Rs. 10,000 crore is envisaged to be provided over the 14th and 15th Finance Commission cycles based on progress of the scheme and availability of funds. It has not only made capital available for startups at early stage, seed stage and growth stage but also played a catalytic role in terms of facilitating raising of domestic capital, reducing dependence on foreign capital and encouraging home grown and new venture capital funds.
3. Credit Guarantee Scheme for Startups (CGSS) : The Government has established the Credit Guarantee Scheme for Startups for providing credit guarantees to loans extended  to  DPIIT  recognized  startups  by  Scheduled  Commercial  Banks,  NonBanking Financial Companies (NBFCs) and Venture Debt Funds (VDFs) under SEBI registered  Alternative  Investment  Funds.  CGSS  is  aimed  at  providing  credit guarantee up to a specified limit against loans extended by Member Institutions (MIs) to finance eligible borrowers viz. DPIIT recognised startups.
4. Regulatory  Reforms :  Over  50  regulatory  reforms  have  been  undertaken  by  the Government since 2016 to enhance ease of doing business, ease of raising capital and reduce compliance burden for the startup ecosystem.
5. Ease  of  Procurement : To  enable  ease  of procurement,  Central  Ministries/ Departments are directed to relax conditions of prior turnover and prior experience in public procurement for all DPIIT recognised startups subject to meeting quality and technical specifications. Further, Government e-Marketplace (GeM) Startup Runway has been developed which is a dedicated corner for startups to sell products and services directly to the Government.
6. Support for Intellectual Property Protection : Startups are eligible for fast-tracked patent application examination and disposal. The Government launched Start-ups Intellectual Property Protection (SIPP) which facilitates the startups to file applications for  patents,  designs  and  trademarks  through  registered  facilitators  in appropriate  IP  offices  by  paying  only  the  statutory  fees.  Facilitators  under  this Scheme  are  responsible  for  providing  general  advisory  on  different  IPRs,  and information on protecting and promoting IPRs in other countries. The Government bears  the  entire  fees  of  the  facilitators  for  any  number  of  patents,  trademark  or designs, and startups only bear the cost of the statutory fees payable. Startups are provided with an 80% rebate in filing of patents and 50% rebate in filling of trademark vis-a-vis other companies.
7. Self-Certification under Labour and Environmental laws : Startups are allowed to self-certify their compliance under 9 Labour and 3 Environment laws for a period of 3 to 5 years from the date of incorporation.
8. Income Tax Exemption for 3 years: Startups incorporated on or after 1st April 2016 can apply for income tax exemption. The recognized startups that are granted an Inter-Ministerial Board Certificate are exempted from income-tax for a period of 3 consecutive years out of 10 years since incorporation.
9. International Market Access to Indian Startups : One of the key objectives under the  Startup  India  initiative  is  to  help  connect  Indian  startup  ecosystem  to  global startup ecosystems through various engagement models. This has been done though international Government to Government partnerships, participation in international forums and hosting of global events. Startup India has launched bridges with over 15 countries (Brazil, Sweden, Russia, Portugal, UK, Finland, Netherlands, Singapore, Israel, Japan, South Korea, Canada, Croatia, Qatar and UAE) that provides a softlanding  platform  for  startups  from  the  partner  nations  and  aid  in  promoting  cross collaboration.
10. Faster Exit for Startups : The Government has notified Startups as 'fast track firms' enabling  them  to  wind  up  operations  within  90  days  vis-a-vis  180  days  for  other companies.
11. Startup India Hub : The Government launched a Startup India Online Hub on 19 th June  2017  which  is  one  of  its  kind  online  platform  for  all  stakeholders  of  the entrepreneurial ecosystem in India to discover, connect and engage with each other. The Online Hub hosts Startups, Investors, Funds, Mentors, Academic Institutions, Incubators, Accelerators, Corporates, Government Bodies and more.
12. Exemption for the Purpose Of Clause (VII)(b) of Sub-section (2) of Section 56 of  the  Act  (2019) :  A  DPIIT  recognized  startup  is  eligible  for  exemption  from  the provisions of section 56(2)(viib) of the Income Tax Act.
13. Startup India Showcase : Startup India Showcase is an online discovery platform for the  most  promising  startups  of  the  country  chosen  through  various  programs  for startups exhibited in a form of virtual profiles. The startups showcased on the platform have distinctly emerged as the best in their fields. These innovations span across various  cutting-edge  sectors  such  as  Fintech,  EntrepriseTech,  Social  Impact, HealthTech, EdTech, among others. These startups are solving critical problems and have shown exceptional innovation in their respective sectors. Ecosystem stakeholders have nurtured and supported these startups, thereby validating their presence on this platform.
14. National  Startup  Advisory  Council :  The  Government  in  January  2020  notified constitution of the National Startup Advisory Council to advise the Government on measures needed to build a strong ecosystem for nurturing innovation and startups in  the  country  to  drive  sustainable  economic  growth  and  generate  large  scale employment opportunities. Besides the ex-officio members, the council has a number of non-official  members,  representing various stakeholders from the startup ecosystem.
15. Startup India: The Way Ahead : Startup India: The Way Ahead at 5 years celebration of Startup India was unveiled on 16 th  January 2021 which includes actionable plans for promotion of ease of doing business for startups, greater role of technology in executing various reforms, building capacities of stakeholders and enabling a digital Aatmanirbhar Bharat.
16. Startup India Seed Fund Scheme (SISFS): Easy availability of capital is essential for entrepreneurs at the early stages of growth of an enterprise. The capital required at this stage often presents a make-or-break situation for startups with good business ideas.  The  Scheme  aims  to  provide  financial  assistance  to  startups  for  proof  of concept, prototype development, product trials, market entry and commercialization. Rs. 945 crore has been sanctioned under the SISFS Scheme for period of 4 years starting from 2021-22.
17. National  Startup  Awards  (NSA) :  National  Startup  Awards  is  an  initiative  to recognize and reward outstanding startups and ecosystem enablers that are building innovative  products  or  solutions  and  scalable  enterprises,  with  high  potential  of employment generation or wealth creation, demonstrating measurable social impact. Handholding support is provided to all the finalists across various tracks viz. Investor Connect,  Mentorship,  Corporate  Connect,  Govt.  Connect,  International  Market Access, Regulatory Support, Startup Champions on Doordarshan and Startup India Showcase, etc.
18. States' Startup Ranking Framework (SRF) : States' Startup Ranking Framework is a  unique  initiative  to  harness  strength  of  competitive  federalism  and  create  a flourishing  startup  ecosystem  in  the  country.  The  major  objectives  of  the  ranking exercise  are  facilitating  states  to  identify,  learn  and  replace  good  practices, highlighting the policy intervention by states for promoting startup ecosystem and fostering competitiveness among states.
19. Startup Champions on Doordarshan : Startup Champions program on Doordarshan  is  a  one-hour  weekly  program  covering  stories  of  award  winning/ nationally  recognised  startups.  It  is  telecasted  in  both  Hindi  and  English  across Doordarshan network channels.
20. Startup India  Innovation  Week : The Government  organises Startup India Innovation week around the National Startup Day i.e. 16 th  January, with the primary goal  was  to  bring  together  the  country's  key  startups,  entrepreneurs,  investors, incubators,  funding  entities,  banks,  policymakers,  and  other  national/international stakeholders to celebrate entrepreneurship and promote innovation.

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