Start Up India Plan

Posted 1 year ago  |    0  |   Views: 209
Corporate Law,Legal Agreement Drafting,Startups
Ravindra Purohit


According to a recent Economic Survey more than 19,000 technology-enabled startups, led by consumer Internet and financial services startups, the report said. "Indian startups raised $3.5 billion in funding in the first half of 2015, and the number of active investors in India increased from 220 in 2014 to 490 in 2015.  Also, ecommerce growth in 2015-16 is expected at 21.4%, to reach $17 billion. To further facilitate the young entrepreneurs keeping in view the potential they have, Modi Government launched Startup India Plan in January 2016.


Startup has been defined as an entity incorporated or registered in India not prior to five years, with annual turnover not exceeding INR 25 cr.  in any preceding financial year, working towards innovation, development, deployment or commercialization of new products, processes or services driven by technology or intellectual property.  Also, any business will only be considered a Startup if it aims to develop a new product, process, new design or improved version of product etc. Such innovation must also be recognized by incubator. So, basically startup plan aims to promote those entities who is having an innovative idea and is trying to bring up something new in the market. 


  • Self regulatory norms for startups to release them from nuisances of labor and environmental laws.  The inspection will be conducted only after 3 years.  Also, startup don’t need to strictly follow water pollution and air pollution laws.
  • A startup India hub will be created as a single point of contact for the entire startup ecosystem to enable knowledge exchange and access to funding.
  • A mobile app and user friendly portal will be launched to check the status of registration and other compliance regulations for startups.
  • The most important problem that startup face is funding. To facilitate this, Government will set up a fund with an initial corpus of INR 2,500 cr. and a total corpus of INR 10,000 cr. over a period 4 years (i.e. INR 2,500 cr. per 1 year) . Also, funds will be ensured by providing credit guarantee fund for startups.
  • Capital gain tax exemption provided for all startups. Also, startup are exempted from income tax for a period of 3 years.
  • Organize workshop and fest at national level where budding entrepreneurs come and share their ideas with investors and incubators. Atal Innovation Mission started to give an impetus to innovation and encourage the talent among the people
  • Establishment of 7 new research parks with an investment of Rs.100 crore each.
  • Promotion of entrepreneurship in biotechnology by establishing 50 bio-incubators, 150 technology transfer offices and 20 bio connect offices.
  • Innovation core program for students in 5 lakh school.


List of facilitators for patent and trademark, list of incubators , list of SEBI registered funds have been notified on the website of New category of white industries that can be exempted to follow environmental guidelines has been notified too. Mobile app and portal has been launched for facilitation of registration and other compliance procedure.


The  plan  proposed by government to facilitate startup in India is a comprehensive plan and has the potential to be successful if implemented properly. However the funding system proposed by scheme is a bit complicated. The Government is not directly providing funds for startups. The fest and workshops is already being organized by various institutes. What needs to be done is to understand the core problem faced by entrepreneurs. The corruption and anti- competitive practices prevailing in the Country needs  to removed  for effective implementation of plan.





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