Lok Sabha Question No. 221 (STARRED), answered on 2016-03-14
Subject: Startup India
Ministry: COMMERCE AND INDUSTRY
Asked by: SULTAN  AHMED, BHARATENDRA SINGH

## GOVERNMENT OF INDIA MINISTRY OF COMMERCE & INDUSTRY

## DEPARTMENT OF INDUSTRIAL POLICY & PROMOTION

## LOK SABHA

STARRED QUESTION NO. 221.

TO BE ANSWERED ON MONDAY, THE 14 TH  MARCH, 2016.

## STARTUP INDIA

## *221. SHRI SULTAN AHMED: KUNWAR BHARATENDRA:

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

## वाणिज् यवव द्यग म त्री

- (a) whether the Government has launched Startup India action plan recently and if so, the salient features of the scheme;
- (b) whether any emphasis has been laid on the rural/backward regions of the country in the scheme and if so, the details thereof;
- (c) whether  the  Government  has  identified  the  activities/businesses  covered  under  the Startup schemes and if so, the details thereof;
- (d) whether  the  Government  is  providing  any  credit  guarantee  to  the  entrepreneurs  for Startup and if so, the details thereof; and
- (e) whether Labour Laws, Taxation and Environment Laws, etc. are likely to be relaxed in the Startup and if so, the details thereof?

## ANSWER

वाणिज् यवव द्यग ााज् यम त्रीस् वतं त्र्रभााा(स्ीमतंीिरममलााीीतंाामि( THE MINISTER OF STATE (INDEPENDENT CHARGE)

OF THE MINISTRY OF COMMERCE & INDUSTRY (SHRIMATI NIRMALA SITHARAMAN)

(a) to (e): A statement is laid on the Table of the House.

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## STATEMENT REFERRED TO IN REPLY TO  PARTS (a) TO (e) OF STARRED QUESTION NO 221 FOR 14.03.2016.

- (a): Yes,  Madam.    Startup  India  initiative  of  the  Government  of  India  was launched to build a strong eco-system for nurturing innovation and Startups in the  country.    This  initiative  aims  to  empower  Startups  to  grow  through innovation  and  design  by  supporting  various  components  of  the  starup  ecosystem.    An  Action  plan  for  Startup  India  has  been  released  by  the  Prime Minister of India on 16 th January, 2016 which includes:-

## i. Simplification and Handholding

-  Simple Compliance Regime for startups based on Selfcertification
-  Launch of Mobile app and Portal for compliance and information exchange
-  Startup  India  Hub  to  handhold  startups  during  various  phases  of their development
-  Legal  support    and  fast-tracking  patent  examination  at  reduced costs
-  Relaxed norms of public procurement for startups
-  Faster exit for startups

## ii. Funding support and Incentives

-  Providing funding support through a Fund of Funds with a corpus of Rupees 10,000 crore
-  Credit guarantee fund for startups
-  Tax exemption on capital gains invested in Fund of Funds
-  Tax exemption to startups for 3 years

## iii. Industry-Academia Partnership and Incubation

-  Organizing Startup Fests to showcase innovations and providing collaboration platforms
-  Launch of Atal Innovation Mission (AIM) with Self -Employment  and  Talent  Utilization  (SETU)  Program  of  NITI Aayog
-  Harnessing private sector expertise for setting up incubators
-  Setting up of 7 new research parks modeled on the Research Park at IIT Madras
-  Launching of innovation focused programs for students.
-  Annual  Incubator  Grand  Challenge  to  promote  good  practices among incubators.
- (b) & (c): No specific component targeting backward/rural areas has been identified in the initiative.  However, the initiative aims at spread of the startup ecosystem to  tier 2 and tier 3 cities including semi-urban and rural areas.   In order to augment the incubation and R&D efforts in the country, the Government plans to set up / scale up 31 centres of innovation and entrepreneurship at national institutes in various cities.  In order to promote research and innovation among young students, the Government shall implement three schemes:  innovation core programme, National Initiative for Developing and Harnessing Innovations (NIDHI) and Uchhattar Avishkar Yojana.
- (d): The initiative provides for creating a credit guarantee fund for startups through National Credit Guarantee Trust Company (NCGTC)/SIDBI with a Corpus of Rs. 500 crore per year for the next four years.
- (e): Labour Laws, Taxation and Environment Laws etc. would be relaxed in the Startup  India  initiative    to  allow  them  to  self-certify  compliance  with  the following 9 labour and environment laws:

## Labour Laws:

-  The Building and other construction workers' (Regulation of employment & conditions of service) Act, 1996
-  The  Inter-State  Migrant  Workmen  (Regulation  of  employment  & conditions of service) Act, 1979.
-  The Payment of Gratuity Act, 1972
-  The Contract Labour (Regulation and Abolition) Act, 1970
-  The Employees' Provident Funds and Miscellaneous Provisions Act, 1952
-  The Employees' State Insurance Act, 1948

## Environment Laws:

-  The Water (Prevention & Control of Pollution) Act, 1974
-  The  Water  (Prevention  &  Control  of  Pollution)  Cess  (Amedment) Act, 2003
-  The Air (Prevention & Control of Pollution) Act, 1981

The Action Plan also provides that in case of labour laws, no inspections will be conducted for a period of 3 years.  Startups may be inspected on receipt of credible and verifiable complaint of violation, filed in writing and approved by at least one level senior to the inspecting officer. In case of environment laws, Startups  which  fall  under  the  'white  category'  as  defined  by  the  Central Pollution Control Board (CPCB) would be able to self-certify compliance and only random checks would be carried out in such cases.

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