The government of India recognises the importance of startups in driving innovation and economic growth. The Government departments related to various ministries have introduced schemes to provide financial, infrastructural, and regulatory support to startups. The startup schemes cover sectors like technology, manufacturing, agriculture, healthcare, and more.
The Startup India scheme is based majorly on three pillars. They are;
The Department for Promotion of Industry and Internal Trade (DPIIT) through the Startup India initiative has executed various projects & undertaken recurring models to propel the Indian Startup Ecosystem. The scheme provides grants, technical guidance, and mentoring to individual innovators by incubating their ideas towards the creation of new enterprises in phases. It also provides grant-in-aid support to technology solution providers developing technology solutions aimed at helping MSME clusters.
Some of the important startup schemes are as follows;
Each scheme’s details, including objectives, and benefits, are provided on related ministries’ websites. Eligible startups can be exempted from paying income tax for 3 consecutive financial years out of their first ten years since incorporation.
Eligibility Criteria: Any Indian citizen aged 18 or above can apply for the scheme. 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. Apart from the general eligibility criteria, the Government of India has specific requirements for startup recognition, which include:
Company’s age: The period of existence and operations should not exceed 10 years from the Date of Incorporation.
Company’s type: Incorporated as a Private Limited Company, a Registered Partnership Firm, or a Limited Liability Partnership.
Annual turnover: Should have an annual turnover not exceeding Rs. 100 crore for any of the financial years since its Incorporation
Note: Entity should not have been formed by splitting up or reconstructing an already existing business.
Contemplating the role of this sector in Employment generation, promotion of entrepreneurship, regional development, export promotion, innovation, reduction of income disparities, and support for large industries, the Government of India along with the Reserve Bank of India launched the following initiatives.
The below schemes help businesses in the MSME sector and are expected to contribute largely to India’s economic growth.
| Prime Minister’s Employment Generation Programme (PMEGP) | Trade Receivable Discounting System (TReDS) |
| Pradhan Mantri Mudra Yojna (PMMY) | Emergency Credit Line Guarantee Scheme (ECLGS) |
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