Lok Sabha Question No. 1202 (UNSTARRED), answered on 2024-07-30
Subject: Startup India Initiative
Ministry: COMMERCE AND INDUSTRY
Asked by: Dr. D Ravi Kumar, Dr. Thirumaavalavan Tholkappiyan

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

## LOK SABHA

## UNSTARRED QUESTION NO. 1202.

TO BE ANSWERED ON TUESDAY, THE 30 TH  JULY, 2024.

## STARTUP INDIA INITIATIVE

- 1202   DR. D RAVI KUMAR: DR. THIRUMAAVALAVAN THOLKAPPIYAN:

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

- (a) the salient features of the Startup India Initiative;
- (b) the details of the funds sanctioned, allocated and utilized by the Government under this initiative in Tamil Nadu;
- (c) the details of various programmes undertaken by the Government to promote Startups under the Startup India initiative in the country including Tamil Nadu;
- (d) the details of the number of entities recognized as Startups under such initiative in Tamil Nadu;
- (e) the details of the target and response of such initiative in the country; and
- (f) the  details  of  steps  taken  by  the  Government  to  promote  such  initiative especially in rural areas of Assam?

## ANSWER

## वाणिज्य एवं उद्योग मंत्रालय में राज्य मंत्री ( श्री णिणिन प्रसाद ) THE MINISTER OF STATE IN THE MINISTRY OF COMMERCE & INDUSTRY (SHRI JITIN PRASADA)

- (a): The  Government,  with  an  intent  to  build  a  strong  ecosystem  for  nurturing innovation, startups and encouraging private investments in startup ecosystem of the country launched Startup India initiative on 16th  January  2016.

The Government unveiled an Action Plan for Startups comprising of 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 'Simplification and  handholding', 'Funding support and  incentives'  and 'Industry-academia partnership and incubation'. For attaining specific objectives   of  the  Action  Plan,  various  programs  are  implemented  by the Government  under  the  Startup  India  initiative  to  recognize,  develop,  and empower startup ecosystem.

- (b): Under  the  Startup  India  initiative,  the  Government  is  implementing  three flagship Schemes, namely, Startup India Seed Fund Scheme (SISFS), Fund of Funds for Startups (FFS) and Credit Guarantee Scheme for Startups (CGSS) to support startups at various stages of their business cycle.

SISFS provides financial assistance to seed stage startups through incubators. SISFS has a corpus of Rs. 945 crore. Specifically for the State of Tamil Nadu, a total sum of Rs. 91.35 crore has been approved for 20 incubators and Rs. 45.09 crore has been disbursed to the approved incubators as on 30 th  June 2024. FFS has been established to catalyze venture capital investments and is    operationalized  by  Small  Industries  Development  Bank  of  India  (SIDBI), which   provides capital to SEBI-registered Alternative Investment Funds (AIFs) who in turn invest in startups. FFS has a corpus of Rs. 10,000 crore. Specifically for the   State  of  Tamil  Nadu,  SIDBI  has  committed  a  total  sum  of  Rs.  510 crore  to  7 AIFs  and  Rs.  419.88  crore  have  been  disbursed  to  the  AIFs  as on 30 th  June  2024.

CGSS is implemented for enabling collateral free loans to the Department for Promotion of Industry and Internal Trade (DPIIT) recognised startups through eligible financial institutions. CGSS is operationalized by the National Credit Guarantee Trustee Company (NCGTC) Limited and has been operationalized on pilot basis from 1st April 2023. Specifically for the State of Tamil Nadu, a total of 16 loans amounting to Rs. 34.28 crore have been guaranteed to eligible recognised startups, as on 30 th  June 2024.

- (c) to (f): For attaining specific objectives, various programs are implemented by  the Government under  the  Startup  India  initiative.  All  the  steps  undertaken   by the Government under the said initiative are inclusive and are implemented across States/Union Territories (UTs), cities, towns, and rural areas, including the States of Tamil Nadu and Assam. The details of such initiatives are placed as Annexure-I .

Sustained efforts by the Government under the Startup India initiative have led to  an  increase  in  the  number of  DPIIT  recognised  startups  to  1,40,803 as on 30 th June 2024. Specifically  in  the  State  of  Tamil  Nadu,  there  are  a total  of 9,238 DPIIT recognized startups as on 30 th  June 2024.

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## ANNEXURE REFERRED TO IN REPLY TO PARTS (c) to (f) OF THE LOK SABHA UNSTARRED QUESTION NO. 1202 FOR ANSWER ON 30.07.2024.

The details of various programs undertaken by the Government to  promote   startups across 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, Non-Banking 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 eMarketplace  (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 Inter-Ministerial Board Certificate are exempted from incometax 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  around  20  countries  that  provides  a  softlanding 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.

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