Manufacturing Sector Should Keep A Close Eye On Startups’ Innovations: FM Sitharaman

Finance Minister (FM) Nirmala Sitharaman on Friday (December 16) urged the Indian manufacturing sector to keep a close eye on the innovations emerging from the homegrown startup ecosystem.

“It is necessary to strengthen our manufacturing sector and in that Indian startups have shown us the way by bringing more innovation. I would urge the industry to keep close watch on the innovations coming from the startups,” said Sitharaman. 

Addressing the annual convention of industry body Federation of Indian Chambers of Commerce and Industry (FICCI) in the national capital, Sitharaman added that both enterprises and startups are bound to benefit mutually if such innovations are scaled, commercialised and adopted. 

She also highlighted that the manufacturing sector and other sunrise sectors could positively benefit from the ‘new energy of startups’.

Calling India’s digital capabilities in payments, financial, education and banking areas stunning, Sitharaman called for showcasing the products to countries across the globe, especially during the spate of G20 events in the country.

Eye On Scaling Startups

With the Budget 2023 around the corner, the government has been involved in intense deliberations as it looks to formulate policies and earmark outlays for various sectors in the next year.

In a letter written to the Finance Ministry, industry body IndiaTech.org sought a range of rebates from slashing Goods and Services Taxes (GST) for certain services to revising TDS rates for sectors such as ecommerce.

Earlier on Saturday, reports also emerged that the Centre was looking to launch funds that offer low-interest loans and tax incentives to agritech startups in the forthcoming budget.

Weeks ago, authorities also threw open the MAARG portal which will serve as a single-window platform to facilitate mentorship for startups across the board.

The government has also been pushing new initiatives and urging the startups to explore new domains. Recently, Sitharaman urged homegrown startups to also focus on developing solutions related to climate change and farming. 

Meanwhile, as delegates pour into the country to attend various G20 events scheduled in the country, the government has been looking to tout digital transformation and the homegrown startups. 

The government estimates the Indian startup ecosystem at around INR 3 Lakh Cr and sees enough scope for further expansion and scale. The ecosystem has also been buoyed by initiatives such as production-linked incentives and the GENESIS scheme which aims to promote more than 10,000 startups in the next six years. 

Despite the recent slump, the Indian startup arena continues to be a lucrative proposition for new age founders and entrepreneurs. This has also led to many conglomerates including Reliance Industries, TVS Group and Tata investing in startups as they look to leverage these innovative startups to fuel their growth and streamline efficiency. 

India is currently home to more than 82,000 DPIIT-recognised startups and 108 unicorns.