Celebrating 8 Years of Startup India
“Startups are the engines of exponential growth, manifesting the power of innovation. Several big companies today are startups of yesterday. They were born with a spirit of enterprise and adventure kept alive due to hard work and perseverance and today have become shining beacons of innovation.” – Prime Minister Narendra Modi on January 16, 2016
In order to build a strong ecosystem for nurturing innovation, startups and encouraging private investments in the startup ecosystem of the country, the Government launched the Startup India initiative on 16th January 2016.
Startup India is an initiative of the Government and not a Scheme. As per eligibility conditions prescribed under G.S.R. notification 127 (E) dated 19th February 2019, entities are recognized as ‘startups’ under Startup India initiative by the Department for Promotion of Industry and Internal Trade (DPIIT).
Under the Startup India initiative, the Government constantly undertakes various efforts for the development and growth of startup ecosystem in the country.
In order to meet the objectives of the initiative, the Government unveiled an Action Plan for Startups comprising of 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”.
The flagship Schemes namely, Fund of Funds for Startups (FFS), Startup India Seed Fund Scheme (SISFS) and Credit Guarantee Scheme for Startups (CGSS) support startups at various stages of their business cycle to enable startups to graduate to a level where they are able to raise investments from angel investors or venture capitalists or seek loans from commercial banks or financial institutions.
The Government also implements annual exercises and programs including States’ Startup Ranking, National Startup Awards and Innovation Week which play an important role in holistic development of the startup ecosystem. The Government also facilitates participation and engagement of Indian startups on international platforms.
The Government has notified the establishment of the Credit Guarantee Scheme for Startups (CGSS) for providing credit guarantees to loans extended by Scheduled Commercial Banks, Non-Banking Financial Companies and Securities and Exchange Board of India (SEBI) registered Alternative Investment Funds (AIFs). CGSS is aimed at providing credit guarantee up to a specified limit against loans extended by Member Institutions (MIs) to finance eligible borrowers viz. entities recognised as ‘startups’ by DPIIT. CGSS is operated by the National Credit Guarantee Trustee Company (NCGTC) Limited.
Startup India is intended to nurture innovation, catalyse startup culture and build a strong and inclusive ecosystem for entrepreneurship in India. It aims at building a robust startup ecosystem and transforming India into a country of job creators instead of job seekers.
Since the launch of Startup India, the startup landscape in India has experienced exponential growth and India has become the third-largest startup ecosystem in the world.
Sustained efforts by the Government of India, under the Startup India initiative, have led to an increase in the number of recognised startups from just 300 in 2016 to 1,18,320 as on January 14, 2024.
Women’s rising role in entrepreneurship fuels economic growth in India. Recognizing this, Startup India actively fosters women’s entrepreneurship through diverse initiatives, schemes, and strategic partnerships.
It is heartening that 55,816 startups (48%) out of a total of 1,17,254 startups in India have at least one woman director (till December 2023). This underscores the impactful role of women in shaping the startup landscape.
Startup India Initiative has successfully highlighted the geographical diversity with more than 50% of startups emerging from tier 2 and 3 cities (till December 2023). This decentralization underscores the inclusive nature of the startup ecosystem.
Recognized startups have significantly contributed to the employment landscape, generating over 12.42 lakh direct jobs (till December 2023). This underscores their pivotal role in fostering economic growth and providing substantial job opportunities across various sectors.
Thus, in its journey since inception, Startup India has emerged as a transformative force, fostering innovation and entrepreneurship. Through sustained efforts, the number of recognized startups has witnessed remarkable growth, reflecting the success of the initiative in nurturing a dynamic entrepreneurial landscape.
Moreover, the active encouragement of women’s entrepreneurship, geographical diversity in startup emergence, and the substantial contribution to job creation underscore the comprehensive impact of Startup India in shaping a vibrant and diverse future for the country’s startup ecosystem.
