Startup India is a flagship initiative of the Government of India, intended to build a strong eco-system for nurturing innovation and Startups in the country that will drive sustainable economic growth and generate large scale employment opportunities.
- The Government through this initiative aims to empower Startups to grow through innovation and design.
- In order to meet the objectives of the initiative, Government of India is announcing this Action Plan that addresses all aspects of the Startup ecosystem
- With this Action Plan the Government hopes to accelerate spreading of the Startup movement:
- From digital/ technology sector to a wide array of sectors including agriculture, manufacturing, social sector, healthcare, education, etc.
- From existing tier 1 cities to tier 2 and tier 3 citites including semi-urban and rural areas.
Startup means an entity,
- incorporated or registered in India not prior to five years,
- with annual turnover not exceeding INR 25 crore in any preceding financial year,
- working towards innovation, development, deployment or commercialization of new products, processes or services
- driven by technology or intellectual property
The Action Plan:
- Compliance Regime based on Self-Certification: To reduce the regulatory burden on Startups thereby allowing them to focus on their core business and keep compliance cost low
- Startup India Hub: To create a single point of contact for the entire Startup ecosystem and enable knowledge exchange and access to funding
- Rolling-out of Mobile App and Portal: To serve as the single platform for Startups for interacting with Government and Regulatory Institutions for all business needs and information exchange among various stakeholders the Government shall introduce a Mobile App to provide on-the-go accessibility for:
- Registering Startups with relevant agencies of the Government
- Tracking the status of the registration application and anytime downloading of the registration certificate
- Filing for compliances and obtaining information on various clearances/ approvals/ registrations required
- Collaborating with various Startup ecosystem partners.
- Applying for various schemes being undertaken under the Startup India Action Plan
- Legal Support and Fast-tracking Patent Examination at Lower Costs: To promote awareness and adoption of IPRs by Startups and facilitate them in protecting and commercializing the IPRs by providing access to high quality Intellectual Property services and resources, including fast-track examination of patent applications and rebate in fees.
- Intellectual Property Rights (IPR) are emerging as a strategic business tool for any business organization to enhance industrial competitiveness. Startups with limited resources and manpower, can sustain in this highly competitive world only through continuous growth and development oriented innovations; for this, it is equally crucial that they protect their IPRs
The scheme for Startup Intellectual Property Protection (SIPP) shall facilitate filing of Patents, Trademarks and Designs by innovative Startups
Various measures being taken in this regard include:
- Fast-tracking of Startup patent applications
- Government to bear facilitation cost
- Rebate on filing of application
- Relaxed Norms of Public Procurement for Startups
- To provide an equal platform to Startups (in the manufacturing sector) vis-à-vis the experienced entrepreneurs/ companies in public procurement
- Faster Exit for Startups: To make it easier for Startups to wind up operations
- Providing Funding Support through a Fund of Funds with a Corpus of INR 10,000 crore: To provide funding support for development and growth of innovation driven enterprises.
Key features of the Fund of Funds:
- The Fund of Funds shall be managed by a Board with private professionals drawn from industry bodies, academia, and successful Startups
- Life Insurance Corporation (LIC) shall be a co-investor in the Fund of Funds
- The Fund of Funds shall contribute to a maximum of 50% of the stated daughter fund size
- The Fund shall ensure support to a broad mix of sectors such as manufacturing, agriculture, health,education, etc.
- Credit Guarantee Fund for Startups: To catalyse enterpreneurship by providing credit to innovators accross all sections of society
- Tax Exemption on Capital Gains: To promote investments into Startups by mobilizing the capital gains arising from sale of capital assets
- Tax Exemption to Startups for 3 years: To promote the growth of Startups and address working capital requirements
- Tax Exemption on Investments above Fair Market Value: To encourage seed-capital investment in Startups
- Organizing Startup Fests for Showcasing Innovation and Providing a Collaboration Platform: To galvanize the Startup ecosystem and to provide national and international visibility to the Startup ecosystem in India
- Launch of Atal Innovation Mission (AIM) with Self-Employment and Talent Utilization (SETU) Program: To serve as a platform for promotion of world-class Innovation Hubs, Grand Challenges, Startup businesses and other self-employment activities, particularly in technology driven areas
The Atal Innovation Mission (AIM) shall have two core functions:
- Entrepreneurship promotion through Self-Employment and Talent Utilization (SETU), wherein innovators would be supported and mentored to become successful entrepreneurs
- Innovation promotion: to provide a platform where innovative ideas are generated
- Harnessing Private Sector Expertise for Incubator Setup: To ensure professional management of Government sponsored / funded incubators,Government will create a policy and framework for setting-up of incubators across the country in public private partnership.
- Building Innovation Centres at National Institutes: To propel successful innovation through augmentation of incubation and R&D efforts
- Setting up of 7 New Research Parks Modeled on the Research Park Setup at IIT Madras: To propel successful innovation through incubation and joint R&D efforts between academia and industry
- Promoting Startups in the Biotechnology Sector: To foster and facilitate bio-entrepreneurship. The Department of Biotechnology shall be implementing the following measures along with its Public Sector Undertaking Biotechnology Research Assistance Council (BIRAC):
- Bio-incubators, Seed Fund and Equity Funding
- Encouraging and leveraging global partnerships
- Launching of Innovation Focused Programs for Students: To foster a culture of innovation in the field of Science and Technology amongst students. In order to promote research and innovation among young students, the Government shall implement the following measures:
- Innovation Core. Innovation Core program shall be initiated to target school kids with an outreach to 10 lakh innovations from 5 lakh schools
- NIDHI: A Grand Challenge program (“National Initiative for Developing and Harnessing Innovations) shall be instituted through Innovation and Entrepreneurship Development Centres (IEDCs) to support and award INR 10 lakhs to 20 student innovations from IEDCs.
- Uchhattar Avishkar Yojana: A joint MHRD-DST scheme which has earmarked INR 250 crore per annum towards fostering “very high quality” research amongst IIT students.
- Annual Incubator Grand Challenge: To support creation of successful world class incubators in India