Lok Sabha Question No. 1746 (UNSTARRED), answered on 2023-12-13
Subject: Promotion of Startups
Ministry: COMMERCE AND INDUSTRY
Asked by: Ganesan Selvam, Dhanush M Kumar

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

## LOK SABHA

UNSTARRED QUESTION NO. 1746. TO BE ANSWERED ON WEDNESDAY, THE 13 TH  DECEMBER, 2023.

## PROMOTION OF STARTUPS

## 1746.  SHRI SELVAM G.:

## SHRI DHANUSH M. KUMAR:

Will the Minister of COMMERCE AND INDUSTRY be pleased to state:

## वाणिज्य एवं उद्योग मंत्री

- (a) the  details  of  the  steps  taken  by  the  Government  to  encourage  and  promote 'Startups' in the country;
- (b) whether the Government has taken initiative in this regard;
- (c) if so, the details thereof;
- (d) the details of employment generated by these Startups' during the last three years, State-wise including Tamil Nadu; and
- (e) the details of revenue generated by these 'Startups'?

## 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) to (c): The Government with an intent to build a strong ecosystem for nurturing innovation, encouraging investments launched the Startup India initiative on 16th January 2016.

To create a holistic environment which is conducive for growth,  the Government is implementing  various  programs  and  schemes  specific  to  promotion  of  startup ecosystem. The list of such measures undertaken by the Government is placed as Annexure-I .

- (d): During the last three years viz. 2020, 2021 and 2022, the entities recognised as startups by the Department for Promotion of Industry and Internal Trade (DPIIT) have reportedly created over 6.15 lakh direct jobs. The State/ Union Territory (UT) wise  details  of  the  same,  including  for  the  State  of  Tamil  Nadu,  are  placed  as Annexure-II .
- (e): Such information is not centrally compiled by the Government .

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## ANNEXURE REFERRED TO IN REPLY TO PARTS (a) to (c) OF THE LOK SABHA UNSTARRED QUESTION NO. 1746 FOR ANSWER ON 13.12.2023.

Details of steps taken by the Government to encourage and promote 'Startups' in the country are as under:

1. Startup India Action Plan: An Action Plan for Startup India was unveiled on 16th 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. Startup India: The Way Ahead: Startup India: The Way Ahead at 5 years celebration of Startup India was unveiled on 16th 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.
3. 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.
4. 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.
5. 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.
6. Regulatory  Reforms: Over  55  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.
7. 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)  also  facilitates and  promotes  procurement  of  products  and  services  by  the  Government  from startups.
8. 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.
9. 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 InterMinisterial  Board  Certificate  are  exempted  from  income-tax  for  a  period  of  3 consecutive years out of 10 years since incorporation.
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. 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.
12. 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.
13. Startup India Hub: The Government launched a Startup India Online Hub on 19th 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.
14. 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  20 countries that provides a soft-landing platform for startups from the partner nations and aid in promoting cross collaboration.
15. 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,  EnterpriseTech,  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.
16. 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.
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, Government 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., 16th 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.
21. ASCEND: Under ASCEND (Accelerating Startup Caliber & Entrepreneurial Drive), sensitization workshops on startups and entrepreneurship were conducted for all eight North Eastern States with the objective to capacitate and augment knowledge on key aspects of entrepreneurship and continue efforts towards creating a robust startup ecosystem in these States.
22. The  Startup  India  Investor  Connect  Portal has  been  co-developed  under  the Startup  India  Initiative  with  SIDBI,  serving  as  an  intermediary  platform  that  links startups  and  investors  in  order  to  help  entrepreneurs  from  various  industries, functions, stages, regions, and backgrounds in mobilizing capital. The portal has been built with the aim to enable in particular; early-stage startups located anywhere in the country to showcase themselves to leading investors/ venture capital funds.
23. National  Mentorship  Portal  (MAARG) : In order to facilitate accessibility to mentorship  for  startups  in  every  part  of  the  country,  the  Mentorship,  Advisory, Assistance,  Resilience,  and  Growth  (MAARG)  program  has  been  developed  and launched under the Startup India Initiative.
24. MeitY  Start-up  Hub  (MSH): A  nodal  entity  to  interconnect  deep  tech  startup infrastructure pan India a 'MeitY Start-up Hub' (MSH) has been set up under Ministry of  Electronics  &  Information  Technology  (MeitY).  MSH  is  assisting  incubators  and startups improving their scalability, market outreach, etc. and has  also established partnerships  with  various  stakeholders  paving  the  way  for  an  economy  built  on innovation and technological advancement.
25. TIDE 2.0 Scheme: Technology Incubation and Development of Entrepreneurs (TIDE 2.0) Scheme was initiated in the year 2019 to promote tech entrepreneurship through financial and technical support to incubators engaged in supporting ICT startups using emerging technologies such as IoT, AI, Block-chain, Robotics etc. The Scheme is being  implemented through  51  incubators  through  a  three-tiered  structure  with  an overarching objective to promote incubation activities at institutes of higher learning and premier R&D organisations .
26. Domain specific Centres of Excellence : MeitY has operationalised 26 Centres of Excellence (CoEs) in diverse areas of national interest for driving self-sufficiency and creating capabilities to capture new and emerging technology areas. These domain specific CoEs act as enablers and aid in making India an innovation hub in emerging through democratisation of innovation and realisation of prototypes.
27. Biotechnology  Industry  Research  Assistance  Council  (BIRAC) :  An  industryacademia interface agency of Department of Biotechnology, Ministry of Science & Technology is supporting biotech startups in all biotech sectors including clean energy and  emerging  technologies.  Project  based  funding  is  provided  to  startups  and companies for product/technology development under its's key Schemes including Biotech Ignition Grant (BIG), Small Business Innovation Research Initiative (SBIRI) and Biotechnology Industry Partnership Programme (BIPP). Incubation support to the startups and companies is also provided through Bioincubators Nurturing Entrepreneurship for Scaling Technologies (BioNEST) Scheme.
28. SAMRIDH Scheme :  MeitY  has  launched  the  'Start-up  Accelerator  Programme  of MeitY for Product Innovation, Development and Growth (SAMRIDH)' with an aim to support existing and upcoming Accelerators to further select and accelerate potential software product based startups to scale.
29. Next Generation Incubation Scheme (NGIS ): NGIS has been approved to support software product ecosystem and to address a significant portion of National Policy on Software Product (NPSP) 2019.
30. Support for International Patent Protection in E&IT (SIP-EIT) Scheme : MeitY had initiated a scheme titled 'Support for International Patent Protection in E&IT (SIP-EIT) that  encourages international patent filing by Indian MSMEs and startups so as to encourage  innovation  and  recognize  the  value  and  capabilities  of  global  IP. Reimbursement provided under the scheme is up to a maximum of Rs. 15 lakhs per invention  or  50%  of  the  total  expenses  incurred  in  filing  and  processing  of  patent application up to grant whichever is lesser.
31. North-East Region Entrepreneurship & Startup Summit (NERES) : Ministry of Skill Development  and  Entrepreneurship  organised  NERES,  an  entrepreneurship  and startup  summit  aimed  at  offering  a  platform  to  promising  startups  and  aspiring entrepreneurs across North-East Region (NER). The objective of NERES was aimed at  stirring  up  entrepreneurial  minds  across  the  NER  states  and  promotes  startup entrepreneurs  by  offering  them  a  platform  to  pitch  their  business  ideas  and  also addressing  various  challenges  faced  by  the  startups.  The  programme  provided  a platform for aspiring and existing entrepreneurs/startups to participate and showcase their  business  ideas  and  plan.  It  also  helped  them  to  learn  more  about  the  good practices and network with fellow startups. The programme has paved the way for startups  and  entrepreneur  to  seek  support  from  mentors  and  an  ecosystem  that support their business growth.
32. Atal Innovation Mission: The Atal Innovation Mission (AIM) is a flagship initiative of the Government, set up by NITI Aayog to promote innovation and entrepreneurship across the length and breadth of the country. AIM has established Atal Tinkering Labs (ATLs) with the objective of fostering curiosity, creativity and imagination in young minds and inculcate skills such as design mind-set, computational thinking, adaptive learning, physical computing, rapid calculations, measurements etc.
33. National Initiative for Developing and Harnessing Innovations (NIDHI): Department of Science and Technology (DST) had launched an umbrella programme called National Initiative for Developing and Harnessing Innovations (NIDHI) in 2016 for  nurturing  ideas  and  innovations  (knowledge-based  and  technology-driven)  into successful startups.
34. Innovations for Defence Excellence (iDEX): iDEX was launched by the Department of  Defense  Production,  Ministry  of  Defense,  to  achieve  self-reliance  and  foster innovation  and  technology  development  in  Defense  and  Aerospace  by  engaging industries such as MSMEs and startups, R&D institutes and academia and providing grants to carry out R&D

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## ANNEXURE - II

## ANNEXURE REFERRED TO IN REPLY TO PART (d) OF THE LOK SABHA UNSTARRED QUESTION NO. 1746 FOR ANSWER ON 13.12.2023.

State/UT-wise number of direct jobs (self-reported) created by recognised startups during the last three years viz 2020, 2021, and 2022 are as under:

| S. No.   | States/UTs                               | 2020    | 2021    | 2022    |
|----------|------------------------------------------|---------|---------|---------|
| 1.       | Andaman and Nicobar Islands              | 32      | 72      | 71      |
| 2.       | Andhra Pradesh                           | 2,849   | 2,304   | 3,067   |
| 3.       | Arunachal Pradesh                        | -       | 31      | 55      |
| 4.       | Assam                                    | 874     | 1,408   | 2,553   |
| 5.       | Bihar                                    | 2,142   | 3,123   | 4,519   |
| 6.       | Chandigarh                               | 355     | 978     | 893     |
| 7.       | Chhattisgarh                             | 1,054   | 1,710   | 2,137   |
| 8.       | Dadra and Nagar Haveli and Daman and Diu | 31      | 136     | 147     |
| 9.       | Delhi                                    | 17,748  | 22,389  | 30,112  |
| 10.      | Goa                                      | 340     | 494     | 860     |
| 11.      | Gujarat                                  | 9,300   | 17,393  | 23,630  |
| 12.      | Haryana                                  | 10,511  | 10,306  | 13,694  |
| 13.      | Himachal Pradesh                         | 281     | 344     | 972     |
| 14.      | Jammu and Kashmir                        | 457     | 776     | 1,314   |
| 15.      | Jharkhand                                | 1,353   | 1,374   | 1,835   |
| 16.      | Karnataka                                | 23,947  | 20,864  | 24,568  |
| 17.      | Kerala                                   | 5,446   | 7,605   | 10,307  |
| 18.      | Ladakh                                   | 3       | -       | 32      |
| 19.      | Lakshadweep                              | 7       | -       | -       |
| 20.      | Madhya Pradesh                           | 3,479   | 6,568   | 11,502  |
| 21.      | Maharashtra                              | 29,211  | 38,504  | 50,983  |
| 22.      | Manipur                                  | 116     | 382     | 309     |
| 23.      | Meghalaya                                | -       | 48      | 61      |
| 24.      | Mizoram                                  | 2       | 15      | 106     |
| 25.      | Nagaland                                 | 32      | 81      | 71      |
| 26.      | Odisha                                   | 2,225   | 3,742   | 4,526   |
| 27.      | Puducherry                               | 68      | 198     | 233     |
| 28.      | Punjab                                   | 1,710   | 2,0429  | 2,318   |
| 29.      | Rajasthan                                | 4,482   | 5,608   | 11,588  |
| 30.      | Sikkim                                   | 2       | 29      | 22      |
| 31.      | Tamil Nadu                               | 7,772   | 9,690   | 17,203  |
| 32.      | Telangana                                | 8,599   | 9,613   | 14,249  |
| 33.      | Tripura                                  | 745     | 95      | 188     |
| 34.      | Uttar Pradesh                            | 13,253  | 18,869  | 22,794  |
| 35.      | Uttarakhand                              | 709     | 1,714   | 1,684   |
| 36.      | West Bengal                              | 2,691   | 6,635   | 9,353   |
|          | TOTAL                                    | 151,826 | 195,527 | 267,956 |

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