While the start-up culture has, over the years, caught traction in India, many successful ventures have domiciled outside the country. Six of the eight ‘unicorns’—start-ups with a valuation of over $1 billion—have domiciled in Singapore and the US during 2015, primarily due to regulatory irritants in India. To ensure that start-ups stay on in the country, iSPIRT—the Indian Software Product Industry Roundtable—has developed a Stay-in-India check-list that has 34 items that cover issues related to RBI and the ministries of finance, corporate affairs and commerce. The issues that have been raised include favourable intellectual property regime, ease of incorporating and liquidating companies, allowing foreign venture capital investments across sectors, and a harmonised tax rate for both listed and unlisted entities. The idea behind the initiative is to make India a preferred destination for start-ups.
While close to 60% of the issues are being been sorted out, iSPIRT argues that that is not enough. Even all the contentious issues are resolved, there will be yet another reason for start-ups to domicile outside India. Unlike in other cases, here the competition is between India and possibly the US and Singapore. Much will depend on what all finance minister Arun Jaitley will roll-out to ensure that India is very much the home for start-ups.