By way of introduction, especially to readers unfamiliar with the Hindi language and the Indian economy, Aadhaar is a Hindi word that means \u2018support\u2019 or \u2018foundation\u2019. It is also the basis or foundation of the Aadhaar card \u2014 an ambitious and powerful programme meant to bestow all Indians with a Unique Identification Number (UID).\r\n\r\nThis article talks about Aadhaar, both literally and in every other sense of the word. It covers the areas in which the government can offer \u2018aadhaar\u2019 or support to stakeholders in the startup industry. It also touches upon how the national ID programme Aadhaar can be leveraged directly to help startups.\r\n\r\nThe government is a key player in the startup ecosystem and can initiate many activities favourable for its overall growth. By formulating certain policies, specifically centered around taxation and regulation, the government can foster a climate conducive for the growth of startups and investors and, by extension, for all related stakeholders: lawyers, bankers, students, consultants, fund of funds etc.\r\n\r\nSo, what can the government do to help in this growth? Well, quite a few things, prime among them being:\r\nMake Taxation Conducive For Entrepreneurship\r\nTo begin with, the government can create a favourable tax regime that is aligned with the often volatile and back-ended nature of cash flows from exit (M&A, IPOs) events.\r\n\r\nIt can rationalize the tax structures \u2014 in fact, make them favourable for early-stage companies that need to reinvest every rupee earned into operations \u2014 in a way that makes the journey much smoother for startups during the brutal early years.\r\n\r\nAchieving parity among private and public markets (which finally happened in India with the introduction of long-term capital gains tax of 10%) is also important. Also, most importantly, it should ensure clarity among all groups of stakeholders to avoid uncertainties in planning and formational issues.\r\nPlay An evangelist\u2019s Role For The Startup Industry \r\nThe government can play a very effective public relations (PR) role for the startup industry by educating all stakeholders of the benefits they can enjoy by partaking in the growth of the ecosystem. It can help remove many of the misconceptions in the minds of people who sometimes perceive the startup industry as one full of reckless speculation and cliqued success stories.\r\n\r\nThe government can also inspire the creation of startups on the campuses of premier engineering and management institutes by encouraging good students to look at entrepreneurship as a viable career option. In this regard, it should look at promoting public-private partnerships \u2014 something it is already doing to boost infrastructure in India.\r\n\r\nThe government can also create sovereign investment vehicles and funds of funds to help VCs increase their corpus. An example of this is the Fund of Funds for Startups (FFS) by the Small Industries Development Bank of India (SIDBI), which was approved by PM Narendra Modi in June 2016.\r\nLend Aadhaar To Startups To Enable Better Decision-Making\r\nWhile Aadhaar was introduced as a biometric identity document for all Indian citizens to enable the government to deliver targeted public welfare and citizen services, it\u2019s original purpose has long since been diluted.\r\n\r\nThe government has made attempts at linking it with everything from bank accounts and mobile numbers, to making it compulsory for buying rail tickets, sparking off a privacy debate that played out in the Supreme Court. While we\u2019re at it, how about the government extending Aadhaar to startups to enable better decision-making?\r\n\r\nFor example, today there are fintech companies that facilitate P2P loans between a lender in Mumbai and a borrower located in a remote village in India. This is facilitated by:\r\n\r\n \tAadhaar (helps easily identify the borrower and by extension, their ability to return the loan)\r\n \tMobile (enough has been written on a billion-plus mobile phones) and\r\n \tJan Dhan (another wonderful financial inclusion scheme for the under-banked in India)\r\n\r\nWhat Aadhaar does is make such \u2018outlier situations\u2019 entirely possible by arming lenders (or anyone needing to verify a person's profile) with enough data points on a person to make a more informed decision.\r\nDevelop A Regulatory Framework For Startup Ecosystem\r\nAnother need of the hour is a helpful regulatory framework that incentivises ecosystem growth, reduces or eliminates existing friction in incorporation, structural changes, and exits at companies, sets timelines for approvals, at the same time ensuring everything functions within the ambit of the law.\r\n\r\nSuch a regulation would be a game-changer for the startup industry.\r\nIsrael, Singapore, and a few other countries have set the standards on how an ecosystem can be cultivated with minimal, yet effective, regulation.\r\nSuch a regulation would stymie roadblocks (not innovation), encourage wealth creation (by legitimate means and in socially acceptable ways), reward entrepreneurial risk-taking (not status quo), and, in general, create a reassuring system that convinces all stakeholders of the probity in the system.\r\nAn Out-of-the-box Suggestion\r\nAnd here\u2019s an out-of-the-box thought: Why not create tax incentives for large corporations that hire failed entrepreneurs.\r\nWhere \u2018failed\u2019 is defined by someone who made a genuine attempt at success \u2014 incorporating, building a product to at least 'post-Beta' stage, getting angel funding (or more), and achieving profitability.\r\nThere are many startups that achieve this level of success but then meander to nowhere. The reasons are many \u2014 ranging from the entry of bigger players into the market, change of regulation, inability to consummate key hires, inability to attract follow-on funding, and so on.\r\n\r\nBy facilitating the induction of entrepreneurs from such \u2018failed\u2019 startups into \u2018regular\u2019 corporate life, the government can inspire a greater entrepreneurial spirit among young graduates.\r\n\r\nThankfully, the recent Indian governments, have recognized the importance of the startup ecosystem in aiding economic growth, creating jobs, and imbuing an entrepreneurial mindset among young people, besides showcasing the country\u2019s technological pedigree.\r\n\r\nWhile a few irritants remain, we remain optimistic of the government\u2019s ability and its intent to continue providing support and extending Aadhaar to the early-stage milieu in India.