PM Narendra Modi launched his ambitious Start-up India campaign admist much fanfare and accolades in New Delhi on January 16, 2016. The programme was launched to benefit the technology-centric start-ups in sectors such as healthcare, education and others.
The final keynote of the day was delivered by none other than the Prime Minister of the country where he drew up what was purported to be an action plan for Indian start-ups. Several potentially game changer policies were announced by the Prime minister.
A dedicated Start-up fund is announced to be set up by the Indian government with an initial corpus of Rs. 2,500 crore and a total corpus of Rs. 10,000 crore over a period of four years, a board with private professionals drawn from industry bodies, academia, and successful start-ups will be looking over the process.
Now the start-ups can register themselves without any hassle as the government will launch a mobile app and portal on the first of April. The portal will also serve as a single point of contact for clearances, approvals and registrations, and for companies to apply for schemes under the Start-up India Action Plan.
The start-ups will be exempted from any inspections for a period of three years and can self-certify compliance on labour laws and environmental laws through the app. These Start-ups will be exempted from paying income tax on their profit for the first three years. However, the exemption shall be available subject to non-distribution of dividend by the start-up.
There will also be a credit guarantee mechanism helping the start-ups with raising initial corpus through the formal banking system which includes National Credit Trust Company/ SIDBI, which has annual fund of Rs 500 crore for next four years.
Government also announced working towards fast-tracking of Start-up patent applications. An eighty percent exemption in patent fee for Start-up businesses and an Innovation Mission named as Atal Innovation Mission will be launched to give a boost to innovation.
The most applauded announcement has been faster exits for start-ups, now the unsuccessful start-ups can wind up the business in 90 days from making of an application for winding up on a fast track basis, as per the recently tabled Insolvency and Bankruptcy Bill 2015.
Moreover, the Central Government, State Government and PSUs will exempt startups in the manufacturing sector from the criteria of "prior experience/ turnover" as long as they have their own manufacturing facility in India, and have the requisite capabilities and are able to fulfil the project requirements.
To inculcate and promote entrepreneurship among youth of the nation, awards will be given to new innovations per state and UT’s. Also an annual festival will be held at the Rashtrapati Bhavan in which the best 100 innovations will be showcased and awarded.
"This start up movement is not merely guided by money or name and fame. The purpose is beyond that," the prime minister said stressing that money is secondary at the conclave.
Entrepreneurs from various domains attended the meet. The announcements made to boost the start-ups and the talent in the country has been welcomed by the entrepreneur community. These young entrepreneurs said India is slowly moving towards a knowledge-based economy and this will provide clout to such sectors. Several analysts also see this attempt to improve India’s ranking in the “ease of doing business” index. Singapore is currently ranked one of the top-ranked countries in this index.
Vijay Shekhar Sharma, the founder of Paytm said, “The announcements by the government were more than what a normal start-up would have expected”.