The government's Action Plan aims to speed up the growth of startups across India, in all critical sectors – in Tier 1, 2, and 3 cities, as well as semi-urban and rural areas – and promotes entrepreneurship among SCs/STs and women.
The Department of Industrial Policy and Promotion (DIPP) has put out a 19-point Action Plan that focuses on removing roadblocks and promoting quicker growth through:
Hand Holding and Simplicity
Support and Incentives for Funding
Incubation and collaboration between industry and academia
Why is Startup India important?
Startup India's mission is to make India prosperous. Many enterprising persons who want to establish their own business don't have the financial means to do so. As a result, their ideas, creativity, and potential go unexplored, resulting in a loss of wealth, economic progress, and jobs for the country.
With proactive assistance and incentives at several levels, Startup India will help stimulate entrepreneurship and economic development by ensuring that those with the potential to innovate and start their own firm are encouraged.
Prime Minister Narendra Modi said it like way:
Startup India is a ground-breaking initiative that aims to assist anyone who wants to establish their own business. Because these people have ideas and the ability to implement them, the government will provide them with assistance so that they can flourish and implement their plans. The success of this initiative will eventually result in India becoming a stronger economy and nation. 1
The 19-Point Action Plan for Startup India
Compliance with self-certification
Startup India Hub provides a single point of contact.
Using a mobile app and a portal to streamline processes (for registration, filing compliances & obtaining information)
Legal assistance, expedited processing, and a fee savings of 80% on patent registration
Public Procurement Norms Have Been Relaxed
Exiting is much easier and faster.
Support for funding from a Fund of Funds with a corpus of INR 10,000 crore
Funding with a Credit Guarantee
Capital Gains Tax Exemption
Exemption from income taxes for three years
Investments that are worth more than their fair market value are exempt from paying taxes (FMV)
Startup Festivals are held every year (national & international)
Under the Atal Innovation Mission, world-class innovation hubs will be launched (AIM)
Establishment of a national incubator network
Incubation and R&D will be aided through Innovation Centers.
Innovation will be aided by research parks.
Encourage biotechnology entrepreneurship.
Students' Programs that Focus on Innovation
The Grand Challenge of the Incubator is held every year.
The Action Plan for Startups in India has been launched.
Prime Minister Narendra Modi announced the Startup India Action Plan on January 16, 2016, to highlight many initiatives and plans suggested by the Indian government to foster innovation and empower startups across the country.
Several incubation centres, simpler patent filing, tax breaks, simplicity of business setup, an INR 10,000 crore corpus fund, and a faster exit mechanism are among the 19-point Action Plan's features.
The Startup India launch attracted around 1500 CEOs, startup founders, and investors, including:
Mr. Masayoshi Son, SoftBank's CEO
Uber's founder, Mr. Travis Kalanick
WeWork's CEO, Mr. Adam Nuemann
Flipkart's founder, Mr. Sachin Bansal
Snapdeal's founder, Mr. Kunal Bahl
Ola founder Mr. Bhavish Aggarwal
Mr. Vijay Shekhar Sharma, Paytm's founder
Support for India's Startups
The Startup India campaign, which aims to put startups at the forefront of India's growth story, has attracted worldwide support. It enables entrepreneurs to concentrate on their main business (rather than time-consuming regulatory compliance) while providing them with a solid eco-system to support their creativity and success.
A Startup's Definition (for the purpose of Government Schemes only)
A startup is a legal entity that includes the following elements:
not have been incorporated or registered in India for more than five years
with a previous financial year's annual turnover of not more than INR 25 crore
working to develop, launch, or commercialise new products, processes, or services that are based on technology or intellectual property
If the following conditions are met, the entity ceases to be a Startup:
It is produced through the dismantling or reconstruction of an existing firm.
It had a revenue of more than INR 25 crore in the preceding financial year.
It has been 5 years since it was incorporated or registered.
Furthermore, the Startup will only be eligible for tax benefits once it has been certified.
The Inter-Ministerial Board, which was created specifically for this purpose.
Terms and Definitions
Entity: Private Limited Company (as defined by The Companies Act, 2013), Registered Partnership Firm (as defined by The Indian Partnership Act, 1932), or Limited Liability Partnership (as defined by The Indian Partnership Act, 1932). (According to the 2008 Limited Liability Partnership Act).
Identifying the businesses that fall under the definition: If a company's goal is to develop and commercialise anything, it falls under the definition:
a brand-new product, service, or procedure; or
a greatly improved existing product, service, or procedure that adds value to customers or workflow
The act of growing itself
products, services, or processes that have little commercial potential; or products, services, or processes that are not differentiated; or
This definition excludes items, services, or processes that provide no or little added value to customers or workflow.
A "Startup" must meet certain criteria in order to be considered eligible.
be backed up by a recommendation (on the basis of the business's innovative nature), in a format prescribed by DIPP, from an Incubator based in an Indian post-graduate college; or
be aided by an incubator that is sponsored (in relation to the project) by the Government of India as part of any designated scheme to stimulate innovation; or
be backed up by a recommendation from a GoI-recognized Incubator (with reference to the innovative character of the firm), in a manner prescribed by DIPP; or
be supported by a SEBI-registered Incubation Fund/Angel Fund/Private Equity Fund/Accelerator/Angel Network that supports the business's creative nature; or be sponsored by the Government of India as part of any specific scheme to promote innovation; or
having an Indian Patent and Trademark Office-issued patent
in locations related to the type of business that is being promoted
* The DIPP may publish a list of funds that are not eligible for this programme.
The Companies Act of 2013 defines turnover as "the amount of money a company earns in a year."
DIPP established an Inter-Ministerial Board to validate the innovative project.
nature of the business for the purpose of giving tax benefits The Inter-Ministerial Board's approval does not restrict or exonerate the entity(ies) from any liability incurred as a result of any deception or fraud deriving from the submission and/or supporting of such an application.
FAQ?
What is the definition of Startup India?
Startup India, the Indian government's flagship programme, intends to create a robust ecosystem that encourages the establishment of new firms, resulting in long-term economic growth and large-scale job creation. The government thinks that this programme would enable enterprises to grow through innovation and design.
Since the inauguration of the initiative on the 16th of January, 2016, several programmes have been implemented to support the Hon'ble Prime Minister's objective of converting India into a country of job creators rather than job seekers. These programmes have accelerated the startup culture, with the Startup India initiative recognising businesses and many entrepreneurs taking advantage of the advantages of beginning a firm in India.
What advantages does the starting strategy provide?
To take advantage of the Startup India scheme's numerous benefits, an entity must first be recognised as a startup by DIPP by submitting an application at
https://www.startupindia.gov.in/content/sih/en/startupgov/startup-recognition-page.html.
The Startup India initiative provides the following incentives to certified startups:
1. Self-certification: certify yourself and comply with three environmental laws and six labour laws.
2. Income tax exemption for three years, as well as capital and investment exemptions in excess of fair market value.
3. Simple Company Winding Up: A company can be wound up in 90 days under the Insolvency and Bankruptcy Code of 2016.
4. Patent Application & IPR Protection for Startups: Get a head start on your patent application with a discount of up to 80% on patent filing expenses.
5. Easier Public Procurement Norms: There is no earnest money deposit required in government procurement, and there are no past turnover or experience requirements.
6. SIDBI Fund of Funds: Funds for Alternative Investment Funds to Invest in Startups (SIDBI Fund of Funds).
Furthermore, the Startup India portal (www.startupindia.gov.in) serves as a one-stop shop for all participants in the startup ecosystem to connect, share expertise, and form effective partnerships in a fast-paced setting.
Visit https://www.startupindia.gov.in/content/dam/invest-india/startup kit.pdf
to learn more
about the benefits of Startup India.
What is a "Startup" according to the Startup India Scheme?
A startup is defined as an entity that meets the following criteria:
1. If it is registered in India as a private limited company, a partnership firm, or a limited liability partnership.
2. For a period of up to 10 years after its incorporation/registration.
3. If its annual turnover has not surpassed INR 100 crores in any of the financial years after incorporation/registration.
4. If it is trying to improve products, processes, or services through innovation, development, or improvement, or if it is a scalable company model with a strong potential for job creation or wealth creation.
Note that an entity founded by dividing up or reconstructing an existing business is not regarded as a 'Startup.'
What is the method for registering on the Startup India website (www.startupindia.gov.in) and creating a profile?
The procedure of creating a profile on the Startup India website is quite straightforward.
1. Simply click 'Register' and fill out the registration form with the relevant information. A one-time password (OTP) will be emailed to your registered email address, after which your profile will be established.
2. You will be given the option of choosing your profile type. The profile for 'Individuals' goes online instantly, however the profile for 'Startups' goes through moderation for 24-48 hours, after which you will be able to access all benefits on www.startup-india.gov.in.
What's the difference between a Startup India-registered company and a DPIIT-recognized company?
A Startup that has a profile on the Startup India website is regarded as a registered Startup on the platform, as stated in the previous question. On the website, these startups can apply for a variety of acceleration, incubator/mentorship, and other challenges, as well as have access to resources like the Learning and Development Program, Pro-bono services, government schemes, and state policies for startups.
Startups must apply for DIPP recognition at https://www.startupindia.gov.in/content/sih/en/startupgov/startup-recognition-page.html.
to obtain advantages such as
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