India now has close to 1.16 lakh government-recognised startups under the Centre’s initiative to boost the country’s startup ecosystem. According to the data shared by the commerce and industry minister Som Parkash in a written reply in the Lok Sabha on Wednesday, under the Startup India programme launched on January 16, 2016, to build an ecosystem for nurturing innovation, startups and encouraging investments in startups, the government has recognised 1,14,902 entities as startups as on October 31, 2023.
However, at the time of filing this report as per data from Startup India portal of the government, 1,15,967 startups were registered under the initiative in the past nearly 8 years.
To register as a startup under the programme, companies with a period of existence and operations should not exceed 10 years from the date of incorporation. Also, the company should be incorporated as a private limited company or a registered partnership firm or a limited liability partnership with an annual turnover not exceeding Rs 100 crore for any of the financial years since its Incorporation.
Moreover, the entity should not have been formed by splitting up or reconstructing an already existing business and should work towards the development or improvement of a product, process or service and/or have a scalable business model with high potential for the creation of wealth & employment, according to the programme’s website.
The recognised entities are eligible for multiple benefits from the government including compliance self-certification for labour laws and environmental laws, assistance in patent applications, tax exemption under section 80IAC of the Income-tax Act, and more.
So far, 2,977 income tax exemptions have been given and 3,654 startups have been funded under the SIDBI Fund of Funds scheme which was established in 2016 with a corpus of Rs 10,000 crore, data from the Startup India website showed. The scheme provides capital to SEBI-registered Alternative Investment Funds (AIFs), known as daughter funds, who in turn invest money in startups through equity and equity-linked instruments.
Other than Fund of Funds scheme, the Startup India programme also involves a Seed Fund scheme to provide financial assistance to startups for proof of concept, prototype development, product trials, market entry and commercialization; and a Credit Guarantee Scheme for providing credit guarantees to loans extended to DPIIT-recognized startups by banks, NBFCs, venture debt funds under SEBI registered AIFs.