Sustained Government efforts result in increasing the number of recognized Startups from 452 in 2016 to 84,012 in 2022

Sustained Government efforts in this direction have resulted in increasing the number of recognized Startups from 452 in 2016 to 84,012 in 2022 (as on 30th November 2022), Minister of State for Commerce and Industry, Shri Som Parkash said in reply to a parliamentary question.

The Government with an intent to build a strong ecosystem for nurturing innovation and startups in the country launched Startup India initiative on 16th January 2016.

In order to meet the objectives of the initiative, the Government unveiled an Action Plan for Startup India that laid the foundation of Government support, 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”.

Details of various programs undertaken under Startup India initiative since inception are placed at Annexure-I.

(a):  As per eligibility conditions prescribed under G.S.R. notification 127 (E) dated 19th February, 2019, entities are recognized as startups by the Department for Promotion of Industry and Internal Trade (DPIIT). 84,012 entities have been recognised as startups from across the country by the DPIIT as on 30th November 2022 . The State/ UT wise number of startups recognition by the DPIIT from the date of commencement of the Startup India initiative is placed at Annexure-II.

(b):   Under Startup India Initiative, to provide capital at various stages of business cycle of a startup, the Government has implemented Fund of Funds for Startups (FFS) and Startup India Seed Fund Scheme (SISFS). Both the Schemes are  implemented on Pan-India basis.

The Fund of Funds for Startups Scheme was approved and established in June 2016 with a corpus of Rs 10,000 crore, with contribution spread over the 14th and 15th Finance Commission cycle based on progress of implementation, to provide much-needed boost to the Indian startup ecosystem and enable access to domestic capital.

Under FFS, the Scheme does not directly invest in startups, instead provides capital to SEBI-registered Alternative Investment Funds (AIFs), known as daughter funds, who in turn invest money in growing Indian startups through equity and equity-linked instruments. Small Industries Development Bank of India (SIDBI) has been given the mandate of operating this Fund through selection of suitable daughter funds and overseeing the disbursal of committed capital. AIFs supported under FFS are required to invest at least 2x of the amount committed under FFS in startups.

As on 30th November 2022, in the FFS, of the corpus of Rs. 10,000 crore, Rs. 7,527.95 crore has been approved (committed) to the AIFs. The State/ UT wise details are placed at Annexure-III.

The Startup India Seed Fund Scheme has been approved for the period of 4 years starting from 2021-22. The Scheme aims to provide financial assistance to startups for proof of concept, prototype development, product trials, market entry and commercialization. It has been implemented with effect from 1st April 2021.

Under SISFS, as per provisions of the Scheme, the Government has constituted an Experts Advisory Committee (EAC) which is responsible for the overall execution and monitoring of the SISFS. The EAC evaluates and selects incubators for allocation of funds under the Scheme. The selected incubators thereon shortlist the startups based on parameters outlined in Scheme guidelines.

As on 30th November 2022, in the SISFS, of the corpus of Rs. 945 crore, Rs. 455.25 crore has been approved to 126 incubators of which Rs. 186.15 crore has been disbursed. The State/ UT wise details are placed at Annexure-IV.

(c): Under Startup India Initiative, entities are recognized by the Department for Promotion of Industry and Internal Trade (DPIIT) as startups as per eligibility conditions prescribed under G.S.R. notification 127 (E) dated 19th February, 2019. As on 30th November 2022, Maharashtra, Karnataka, Delhi, Uttar Pradesh and Gujarat are the top five States/UTs in terms of number of recognised startups.

(d): Under Startup India Initiative, entities are recognized as startups by the DPIIT as per eligibility conditions prescribed under G.S.R. notification 127 (E) dated 19th February, 2019. The district-wise number of entities recognised as startups by the DPIIT in the States of Karnataka and Maharashtra during the last two years is placed at Annexure-V.

 ANNEXURE-I

Programs Launched under Startup India initiative

The details of various programs undertaken by the Government to promote startups under Startup India initiative across the country are as under:

1. Startup India Action Plan: An Action Plan for Startup India was unveiled on 16^th 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. 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.
3. 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.
4. Regulatory Reforms: Over 50 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.
5. 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) Startup Runway has been developed which is a dedicated corner for startups to sell products and services directly to the Government.
6. 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.
7. 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.
8. 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 income-tax for a period of 3 consecutive years out of 10 years since incorporation.
9. 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 over 15 countries (Brazil, Sweden, Russia, Portugal, UK, Finland, Netherlands, Singapore, Israel, Japan, South Korea, Canada, Croatia, Qatar and UAE) that provides a soft-landing platform for startups from the partner nations and aid in promoting cross collaboration.
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. Startup India Hub: The Government launched a Startup India Online Hub on 19^th 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.
12. 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.
13. 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, EntrepriseTech, 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.
14. 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.
15. Startup India: The Way Ahead: Startup India: The Way Ahead at 5 years celebration of Startup India was unveiled on 16^th 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.
16. 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.
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, Govt. 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. 16^th 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.

 ANNEXURE-II

The State/ UT wise number of startups recognition by the DPIIT from the date of commencement of the Startup India initiative as on 30^th November is as under:

States	2016	2017	2018	2019	2020	2021	2022	Total
Andaman and Nicobar Islands		1	2	8	5	13	9	38
Andhra Pradesh	4	97	158	174	231	296	340	1,300
Arunachal Pradesh			2	2		4	8	16
Assam	9	34	67	67	119	187	245	728
Bihar	1	46	145	154	258	390	469	1,463
Chandigarh	8	21	25	39	53	69	73	288
Chhattisgarh	11	56	118	158	153	165	210	871
Dadra and Nagar Haveli and Daman and Diu		4	1	3	5	12	12	37
Delhi	62	713	1,147	1,371	1,765	2,178	2,352	9,588
Goa	2	19	43	41	67	80	99	351
Gujarat	24	278	434	591	878	1,709	1,963	5,877
Haryana	25	253	474	694	806	1,060	1,199	4,511
Himachal Pradesh		9	16	28	41	56	103	253
Jammu and Kashmir	2	13	43	37	64	132	159	450
Jharkhand	2	35	85	88	163	191	208	772
Karnataka	58	828	1,172	1,659	1,729	2,141	2,317	9,904
Kerala	24	158	320	647	699	919	997	3,764
Ladakh					1		4	5
Lakshadweep					1			1
Madhya Pradesh	7	101	287	327	423	557	813	2,515
Maharashtra	86	1,047	1,607	2,118	2,671	3,703	4,339	15,571
Manipur		3	7	6	12	37	30	95
Meghalaya			2	5		9	10	26
Mizoram			2	1	1	2	6	12
Nagaland	1	4	2	2	5	7	7	28
Odisha	4	105	163	184	277	389	400	1,522
Puducherry		3	15	10	13	17	29	87
Punjab	7	28	63	92	146	240	263	839
Rajasthan	13	137	241	349	493	619	879	2,731
Sikkim		1		2	1	3	2	9
Tamil Nadu	43	252	448	602	755	1,103	1,501	4,704
Telangana	20	303	496	592	798	980	1,237	4,426
Tripura			2	7	23	11	26	69
Uttar Pradesh	27	385	764	873	1,370	1,966	2,334	7,719
Uttarakhand	4	43	69	97	114	162	214	703
West Bengal	8	170	269	300	394	682	916	2,739
Grand Total	452	5,147	8,689	11,328	14,534	20,089	23,773	84,012

ANNEXURE-III

The details of the amount allocated and utilized under the Fund of Funds for Startups, State/UT-wise as on 30^th November 2022 are as under:

Name of State/ UT	Total Amount Allocated in Rs. Crore (Committed to the Alternative Investment Funds)	Total Amount Utilised in Rs. Crore (Drawdowns made by the Alternative Investment Funds and Disbursed by SIDBI)
Assam	25.00	16.48
Delhi	751.00	539.31
Gujarat	100.00	51.75
Haryana	111.00	34.42
Karnataka	1,719.75	754.15
Maharashtra	4,241.20	1,450.58
Tamil Nadu	450.00	279.05
Telangana	130.00	78.56
Grand Total	7,527.95	3,204.29

 ANNEXURE-IV

The details of the amount allocated and utilized under the Startup India Seed Fund Scheme, State/UT-wise as on 30^th November 2022 are as under:

Name of State/ UT	Total Amount Allocated (approved to the selected incubators)* (In Rs. Crore)	Total Amount Utilised (disbursed to the selected incubators)* (In Rs. Crore)
Andhra Pradesh	4.00	1.60
Assam	2.00	0.80
Bihar	10.00	4.00
Chhattisgarh	1.00	0.40
Delhi	12.00	4.80
Goa	11.80	4.72
Gujarat	62.00	22.40
Haryana	7.00	2.80
Himachal Pradesh	8.00	2.00
Karnataka	49.50	19.55
Kerala	18.00	8.70
Madhya Pradesh	12.00	4.80
Maharashtra	62.50	23.60
Odisha	19.00	6.80
Puducherry	8.00	3.20
Punjab	13.00	4.00
Rajasthan	33.50	12.60
Sikkim	3.00	1.20
Tamil Nadu	34.00	18.70
Telangana	39.95	17.58
Uttar Pradesh	30.00	15.90
Uttarakhand	10.00	4.00
West Bengal	5.00	2.00
Grand Total	455.25	186.15

* Note:          The above amounts are exclusive of management fee of 5% of the approved amount.

  ANNEXURE-V

The district-wise number of entities recognised as startups by the DPIIT in Karnataka during the last two years are as follows:

Districts	2020	2021
Bagalkot	4	3
Ballari	3	8
Belagavi	19	26
Bengaluru	1
Bengaluru Rural	45	136
Bengaluru Urban	1,458	1,683
Bidar	3	4
Chamarajanagar	3
Chikballapur	2	4
Chikkamagaluru	4	3
Chitradurga	2	5
Dakshina Kannada	34	41
Davanagere	5	7
Dharwad	29	39
Gadag		3
Hassan	3	11
Haveri	1	4
Kalaburagi	5	5
Kodagu	2	3
Kolar	6	10
Koppal		2
Mandya	10	3
Mysuru	48	62
Raichur	2	8
Ramanagaram	5	3
Shivamogga	10	17
Tumakuru	8	10
Udupi	8	21
Uttara Kannada	5	9
Vijayapura	4	10
Yadgir		1
Grand Total	1,729	2,141

The district-wise number of entities recognised as startups by the DPIIT in Maharashtra during the last two years are as follows:

Districts	2020	2021
Ahmednagar	21	35
Akola	4	18
Amravati	8	20
Aurangabad	39	84
Beed	2	10
Bhandara	6	5
Buldhana	10	17
Chandrapur	4	14
Dhule	6	8
Gadchiroli	4	1
Gondia	9	13
Hingoli		4
Jalgaon	17	29
Jalna	2	9
Kolhapur	27	47
Latur	8	10
Mumbai	744	994
Mumbai Suburban	243	287
Nagpur	124	162
Nanded	10	18
Nandurbar	2	6
Nashik	82	122
Navi Mumbai	1
Osmanabad	1	9
Palghar	39	32
Parbhani	5	7
Pune	769	1,015
Raigad	69	97
Ratnagiri	7	8
Sangli	15	32
Satara	13	25
Sindhudurg	3	5
Solapur	18	26
Thane	350	517
Wardha	3	8
Washim	3	1
Yavatmal	3	8
Grand Total	2,671	3,703

 This information was given by Minister of State for Commerce and Industry, Shri Som Parkash in reply to a parliamentary question.