Lok Sabha Question No. 4535 (UNSTARRED), answered on 2022-03-30
Subject: Innovations in Startups
Ministry: COMMERCE AND INDUSTRY
Asked by: S. Jagathrakshakan

## GOVERNMENT OF INDIA MINISTRY OF COMMERCE & INDUSTRY

## DEPARTMENT FOR PROMOTION OF INDUSTRY AND INTERNAL TRADE LOK SABHA

UNSTARRED QUESTION NO. 4535. TO BE ANSWERED ON WEDNESDAY, THE 30 TH  MARCH, 2022.

## INNOVATIONS IN STARTUPS

## 4535. SHRI S. JAGATHRAKSHAKAN:

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

- (a) whether  the  Government  agrees  with  the  view  that  Startups  need  to  be mentored and encouraged to cautiously bridge the gap between innovation and urban concerns;
- (b) if so, the steps proposed to be taken by the Government in this regard; and
- (c) if not, the reasons therefor?

## 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) : Startups and the entire innovation ecosystem are the engines of growth for  any  country.  Recognizing  this  aspect,  the  Government  launched Startup  India  initiative  on  16th  January  2016  with  an  aim  to  build  a stronger ecosystem for nurturing India's startup culture that would further drive our economic growth, support entrepreneurship, and enable largescale employment opportunities.

Sustained Government  efforts in this direction have resulted in increasing the number of recognized Startups from 726 in FY 2016-17 to 65,861 in FY 2021-22 (as on 14th March 2022). There is at least one recognized  startup  from  every  State  and  UT  and  nearly  50%  of  the recognized startups are from Tier-II and III cities. Recognized startups are spread across over 640 districts and have reported creation of more than 7 lakh jobs.

Assisted  by  the  States'  Startup  Rankings  on  Support  to  Startup Ecosystems, which is primarily an exercise to identify good practices, learn  from  each  other  and  helping  each  other  in  formulation  and implementation  of  policies  in  true  spirit  of  cooperative  federalism,  a momentum  has  been  built  across  states  to  build  favourable  policy landscape for startups. Mentorship has been a key pillar of evaluation under  this  ranking  exercise  which  has  played  an  important  role  in enabling mentorship to startups across the country.

To identify the depth, quality and spread of innovation and entrepreneurship  in  country,  the  Government  instituted  the  National Startup  Awards  ('NSA').  The  winners  of  NSA  have  emerged  from Bengaluru, Delhi, Hyderabad Chennai, Mumbai  Mysuru, Bhopal, Ernakulam, Gurugram, Kochi, Lucknow, Margao, Sonipat and Tiruvanantpuram etc. The winners and finalists of NSA are also provided handholding  support  across  various  pillars  including  mentorship. The Government under the Startup India initiative also helps Indian startups to connect with global startup ecosystems through various engagement models including enabling global mentorship.

Startups, have actively contributed in Government's flagship programs such  as  Atal  Mission  for  Rejuvenation  and  Urban  Transformation (AMRUT),  Smart  Cities  Mission,  Swachh  Bharat  Mission,  National Heritage City Development and Augmentation Yojana (HRIDAY scheme) to improve urban infrastructure and service provision.

Furthermore, DPIIT has recognized startups which are spread across 56 diversified sectors. More than 20% of these startups are in sectors such as Automotive, Green Technology, Healthcare and Lifesciences, Renewable Energy, etc. Over 4,500 recognized startups are in Sectors like  Construction,  House-hold  Services,  Logistics,  Real  Estate  and Transportation  and  Storage  contributing  towards  urban  concerns. Sector-wise number of startups recognized is placed at Annexure-I .

In  addition  to  the  above,  the  various  measures  undertaken  by  the Government under Startup India initiative are at Annexure-II .

(c): In view of the above, the question does not arise.

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## ANNEXURE-I

## ANNEXURE REFERRED TO IN  REPLY TO PARTS (a) & (b)  OF THE LOK SABHA UNSTARRED QUESTION NO. 4535 FOR ANSWER ON 30.03.2022.

| Sector wise number of recognized Startups as on 14 th March 2022   | Sector wise number of recognized Startups as on 14 th March 2022   | Sector wise number of recognized Startups as on 14 th March 2022   |
|--------------------------------------------------------------------|--------------------------------------------------------------------|--------------------------------------------------------------------|
| S. No.                                                             | Sector                                                             | Number of Recognized Startups                                      |
| 1                                                                  | Advertising                                                        | 526                                                                |
| 2                                                                  | Aeronautics Aerospace & Defence                                    | 579                                                                |
| 3                                                                  | Agriculture                                                        | 3026                                                               |
| 4                                                                  | Artificial Intelligence (AI)                                       | 1315                                                               |
| 5                                                                  | Airport Operations                                                 | 6                                                                  |
| 6                                                                  | Analytics                                                          | 537                                                                |
| 7                                                                  | Animation                                                          | 66                                                                 |
| 8                                                                  | AR VR (Augmented + Virtual Reality)                                | 367                                                                |
| 9                                                                  | Architecture Interior Design                                       | 358                                                                |
| 10                                                                 | Art & Photography                                                  | 212                                                                |
| 11                                                                 | Automotive                                                         | 1220                                                               |
| 12                                                                 | Biotechnology                                                      | 135                                                                |
| 13                                                                 | Chemicals                                                          | 507                                                                |
| 14                                                                 | Computer Vision                                                    | 199                                                                |
| 15                                                                 | Construction                                                       | 2292                                                               |
| 16                                                                 | Dating Matrimonial                                                 | 53                                                                 |
| 17                                                                 | Design                                                             | 507                                                                |
| 18                                                                 | Education                                                          | 4386                                                               |
| 19                                                                 | Enterprise Software                                                | 1318                                                               |
| 20                                                                 | Events                                                             | 275                                                                |
| 21                                                                 | Fashion                                                            | 792                                                                |
| 22                                                                 | Finance Technology                                                 | 2059                                                               |
| 23                                                                 | Food & Beverages                                                   | 3002                                                               |
| 24                                                                 | Green Technology                                                   | 1563                                                               |
| 25                                                                 | Healthcare & Lifesciences                                          | 6098                                                               |
| 26                                                                 | House-Hold Services                                                | 448                                                                |
| 27                                                                 | Human Resources                                                    | 1248                                                               |
| 28                                                                 | Indic Language Startups                                            | 165                                                                |
| 29                                                                 | Internet of Things                                                 | 1216                                                               |
| 30                                                                 | IT Services                                                        | 8280                                                               |
| 31                                                                 | Logistics                                                          | 209                                                                |
| 32                                                                 | Marketing                                                          | 1370                                                               |
| 33                                                                 | Media & Entertainment                                              | 1056                                                               |
| 34                                                                 | Nanotechnology                                                     | 114                                                                |
| 35                                                                 | Non- Renewable Energy                                              | 1316                                                               |
| 36                                                                 | Other Specialty Retailers                                          | 464                                                                |
| 37                                                                 | Passenger Experience                                               | 5                                                                  |

| 38   | Pets & Animals                     |   163 |
|------|------------------------------------|-------|
| 39   | Professional & Commercial Services |  3268 |
| 40   | Real Estate                        |   526 |
| 41   | Renewable Energy                   |  1753 |
| 42   | Retail                             |  1586 |
| 43   | Robotics                           |   386 |
| 44   | Safety                             |   207 |
| 45   | Security Solutions                 |   682 |
| 46   | Social Impact                      |   438 |
| 47   | Social Network                     |   532 |
| 48   | Sports                             |   321 |
| 49   | Technology Hardware                |  2037 |
| 50   | Telecommunication & Networking     |   642 |
| 51   | Textiles & Apparel                 |   866 |
| 52   | Toys and Games                     |   103 |
| 53   | Transportation & Storage           |  1115 |
| 54   | Travel & Tourism                   |  1039 |
| 55   | Waste Management                   |   288 |
| 56   | Not Specified                      |  2620 |
|      | Grand Total                        | 65861 |

******

## ANNEXURE-II

## ANNEXURE REFERRED TO IN  REPLY TO PARTS (a) & (b)  OF THE LOK SABHA UNSTARRED QUESTION NO. 4535 FOR ANSWER ON 30.03.2022.

## Programs Launched under Startup India initiative

The  details  of  various  programs  undertaken  by  the  Government  to  promote startups across the country under Startup 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. Regulatory  Reforms :51  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.
4. Support  for  Intellectual  Property  Protection :  Startups  are  eligible  for  fasttracked 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.
5. 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.
6. Income Tax Exemption for 3 years: Startups incorporated on or after 1st April 2016  can  apply  for  income  tax  exemption.  The  recognised  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.
7. 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 13 countries (Brazil, Sweden, Russia, Portugal, UK, Finland, Netherlands,  Singapore,  Israel,  Japan,  South  Korea,  Canada,  Croatia)  that provides a soft-landing platform for startups from the partner nations and aid in promoting cross collaboration.
8. 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.
9. 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.
10. 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.
11. Startup India Showcase : Startup India Showcase is an online discovery platform for the most promising startups of the country chosen through various programs for startupsexhibited 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.
12. 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.
13. 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.

14. 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.

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