The Startup India initiative was announced in August 2015. Its objective is to develop a system to galvanise entrepreneurship through easy bank loan, income tax benefits and less compliance burden.
The government’s Startup India initiative appears to be not yielding the desired outcome. According to a report by The Indian Express, the Department of Industrial Policy and Promotion (DIPP) had utilised just Rs 4 lakh of allocated Rs 10 core for the promotion of the scheme in 2017-18 ( as on December 31, 2017). This was said in a report by the department-related Parliamentary Standing Committee on Commerce.
The report said the Parliamentary committee, which presented its report on March 14, expressed serious concerns about the huge gap between the number of startups receiving funding, tax exemptions and number of such entities that have been recognised. It observed that as on February 6, 2018, 6,981 startups have been recognised by the DIPP. Of these startups, 99 have been funded and 82 have been certified for claiming tax exemptions under the Income Tax Act, 1961.
The report also said the panel fears that the functioning of the Startup India Hub and call centre was hampered due to low utilisation of funds. Further, it noted that the proposed Rs 2,000 crore Credit Guarantee Fund for startups is still in the initial stage. The Credit Guarantee Fund was announced by the government in January 2016. It has been been allocated Rs 1 lakh in Budget Estimate of 2018-19, the report said.
The Startup India initiative was announced by Prime Minister Narendra Modi in August 2015. Its objective is to develop a system to galvanise entrepreneurship through easy bank loan, income tax benefits and less compliance burden.
The committee has now asked the DIPP to explain the reasons for funding so less number of recognised startups. Besides, it suggested the DIPP to take measures to ensure genuine entrepreneurs are provided with all help. The DIPP has set a target to facilitate and support 1,000 startups by March 2019.